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Bowmark Capital

PRI reporting framework 2020

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Overview

PE 01. Description of approach to RI

01.1. Provide a brief overview of your organisation’s approach to responsible investment in private equity.

The concept of responsible investing ("RI") refers to an approach that explicitly recognises the relevance of environment, social and governance ("ESG") factors in the investment decision making process. As an asset class, private equity is particularly suited to the application of RI as a result of its long-term investment horizons and active ownership style.

Bowmark recognises the importance of RI and of developing sustainable businesses through the proactive management of ESG issues. Specifically, we understand the need to ensure that the management of ESG factors is embedded within our investment evaluation and ongoing portfolio management processes, as outlined in this policy.

Bowmark commits to consider material ESG issues in the course of its due diligence, and in the ongoing monitoring, of portfolio investments. For these purposes, material ESG issues are defined as those issues that have, or have the potential to have, a direct substantial impact on an organization’s ability to create, preserve, or erode economic value, as well as environmental and social value for itself and its stakeholders (including its employees).


PE 02. Investment guidelines and RI

02.1. Indicate whether your organisation’s investment activities are guided by a responsible investment policy / follow responsible investment guidelines.

02.2. Describe how your organisation outlines expectations on staff and portfolio companies’ approach towards ESG issues in investment activities.

To ensure consistency and transparency in our approach to the management of ESG risks and opportunities, we have developed the Bowmark ESG Due Diligence Framework. This represents a checklist which Bowmark investment executives use to assess a potential investee company's ESG performance. Furthermore, it sets out the post-investment actions that will be taken to address any material ESG-related issue that have been identified in due diligence and outlines the objectives for the long term improvement of the company's ESG credentials. This framework will be completed by the relevant investment executive, in conjunction with a third party subject matter expert.

Having completed an investment, the relevant Bowmark investment executive will be responsible for ensuring the ongoing monitoring of the ESG performance of an investee company through:

  • Implementing the post-investment actions as identified during due diligence phase;
  • Instituting periodic review of the company's ESG performance at board level;
  • Where appropriate, ensuring implementation of and ongoing reporting against appropriate KPIs; and,
  • Reporting on investee company ESG performance as part of the quarterly portfolio monitoring process.

 


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