Aether has incorporated reviews of environmental, social and governance factors in its due diligence activities since the time of its first investment in 2009. In 2016, Aether formalized its approach by approving a formal ESG Policy. Aether's ESG Policy & Procedures document describes the due diligence and monitoring activities Aether is expected to employ with respect to underlying investments. It also describes the actions to be taken by Aether in the event that a violation is identified or suspected in the course of its monitoring activities.
Aether's ESG Policy & Procedures covers four primary areas: human rights, labor, environment and anti-corruption. The ESG Policy & Procedures were developed primarily with reference to the United Nations Global Compact and its principles but was also informed by the United Nations Principles for Responsible Investment. In general, Aether's ESG Policy & Procedures are designed to address the following with its partners: (i) review of their policies, (ii) review of the procedures to ensure compliance with their policies, (iii) review of their monitoring activies, and (iv) provide feedback to improve ESG-related policies and procedures wherever possible.
To ensure consistent application of its ESG Policy prior to investment, Aether requests copies of ESG policies and other related documentation, reviews those materials versus Aether's internal checklist to identify potential gaps in existing policies, conducts meetings to better understand ESG policies and to discuss procedures to implement those policies, frequently suggests improvements to existing policies and reviews revised policies to ensure that open items have been sufficiently addressed. In some cases, Aether may also assist in the development of its partners' ESG policies. To ensure proper monitoring post investment, Aether will generally ensure that the investment's governing documents require Aether's partners to provide sufficient reporting on a quarterly basis. If ESG-related reporting obligations are not included in the investment's governing documents, Aether will typically request a side letter to ensure proper reporting. Aether documents both positive and negative ESG-related items associated with underlying investments on a quarterly basis.
Aether's ESG Policy & Procedures are available upon request from Aether's investors or prospective investors.