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Oquendo Capital

PRI reporting framework 2020

You are in Direct - Fixed Income » ESG incorporation in actively managed fixed income » (A) Implementation: Screening

(A) Implementation: Screening

FI 04. Types of screening applied

04.1. Indicate the type of screening you conduct.

Select all that apply
Corporate (non-financial)
Negative/exclusionary screening
Positive/best-in-class screening
Norms-based screening

04.2. Describe your approach to screening for internally managed active fixed income

Our funds do not invest in companies related to:

- the production or trade with tobacco or distilled alcoholic beverages and related products,

- the financing of the production of weapons or ammunition of any kind,

- the development of casinos or equivalent enterprises

- the production, development or holding and/or management of real estate 

- the research, development or technical applications relating to electronic data programs or solutions regarding internet gambling, online casinos, pornography or are intended to enable the illegally download electronic data.

- the research, development or technical applications relating to human cloning for research or therapeutic purposes or genetically modified organisms (GMOs)

 

On the other hand we systematically monitor compliance with the following norms:

- The UN Global Compact 10 Principles

- The OECD Principles of Corporate Governance

- The Universal Declaration of Human Rights (UDHR)

- The Equator Principles 

04.3. Additional information. [Optional]

ESG is embeded in our financial analysis, so we factor in ESG performance as a proxy for quality in our valuation models. Due to our investment style - investors in private debt with lack of comparables - we do not pursue a best in class approach.

In its responsible investment policy Oquendo establishes several principles that rule the activities carried out by the organisation and its investees. Some of those principles are listed below:

ENVIRONMENTAL: Oquendo designs and implements a proactive behavior to environmental challenges. This includes the assessment, management and communication of risks and it is aimed at avoiding or minimizing environmental damage. All players directly or indirectly responsible for environmental damage are obliged to undertake appropriate remedies and offer compensation as soon as they are aware of the damage causation.

We are also focused on complying with environmental laws and regulations and follow international standards and principles, such as limitation of emissions of harmful substances and waste and use of natural resources responsibly such as water and materials.

Additionally, we achieve cost savings and other value creation through improved eco-efficiencies and investment in sustainable products, services and technologies, rather than other non-sustainable, no matter of the cost difference

 

SOCIAL: We are also focused on complying with environmental laws and regulations and follow international standards and principles, such as limitation of emissions of harmful substances and waste and use of natural resources responsibly such as water and materials.

Additionally, we achieve cost savings and other value creation through improved eco-efficiencies and investment in sustainable products, services and technologies, rather than other non-sustainable, no matter of the cost difference.

We provide healthy and safe-working environments, including the adoption of appropriate precautionary measures to protect employees, service providers, the local community and any other players affected.

We promote diversity and equal treatment without consideration for age, gender, marital or parental status, sexual orientation, ethnic or national origin, culture, political affiliation, physical ability, appearance, education or religious background.

Elimination of discrimination in respect of employment and occupation, fighting against discriminatory practices in recruiting, promoting and rewarding employees is also critical for Oquendo. Specifically, policies, procedures and practices are not applied in ways that may negatively impact a particular employee or a specific group of employees or potential employees.

Oquendo promotes and contributes to the elimination of all forms of forced or compulsory labor and, specifically, the abolishment of child labor. Oquendo respects the internationally recognized labor rights, which enables workers to express their opinions, including claims and complaints and protecting their rights with regard to working conditions to the extent permitted under local law.

 

CORPORATE GOVERNANCE: Oquendo promotes professional and best-in-class corporate governance. Assess companies’ corporate governance performance in light of compulsory regulations, local rules and regional best practice in their own markets.

We support effective board structures, with an appropriate allocation of executive responsibilities and balance between executive and independent directors, with fair and consistent remuneration to the employees and key roles according to the performance of their functions, fully aligned with the interests of the company and stakeholders.

Oquendo designs an independent audit and transparent policies in order to ensure conducts of the companies are law-abiding and proportionated, maintaining business integrity, being compliant with relevant international standards, conventions and agreements on business integrity, anti-corruption and anti-bribery and appropriate management of associated risks.

 

We are currently formalizing additional detailed guidelines to further strengthen monitoring and the deployment of ESG factors in our portfolio management.


FI 05. Examples of ESG factors in screening process (Private)


FI 06. Screening - ensuring criteria are met

06.1. Indicate which systems your organisation has to ensure that fund screening criteria are not breached in fixed income investments.

Type of screening
Checks
Negative/exclusionary screening

other description

          Periodic reviews
        
Norms-based screening

other description

          Periodic reviews
        

06.2. Additional information. [Optional]

Periodic reviews

Oquendo combines a three-tier structure for reviewing its portfolio companies.

(i) Our portfolio managers track companies activities in an ongoing basis and specifically analyse their consistency with our ESG policies and guidelines.
(ii) On top that, we conduct a thorough review on ESG performance through a questionnaire containing 74 specific items. We do this once a year and report progress to our investors.
(iii) Our role as directors or our influence on the companies´ boards.

We conduct a review every year to gauge a progress on ESG issues at our investees. We also oversee most of our investees by sitting at their boards.


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