Antin has formalised a Responsible Investment (RI) Policy approved by the board of directors outlining our approach to the integration of ESG issues in our business model and investment management processes. Our RI Policy, which was first implemented in 2011, is reviewed and updated at least once a year, and after any significant change in the insights on which it is based. This Policy applies to all funds without exceptions.
RESPONSIBLE INVESTMENT APPROACH
Asset selection and origination
Antin’s strategy is to invest in brownfield infrastructure assets with potential for operational improvements and active capital management. This strategy leads us to invest in companies with existing operations, in industries where ESG issues are usually thoroughly addressed and already actively monitored and reported on (energy and environment, transport, telecommunications, social infrastructure).
ESG due diligence and deal execution
During the due diligence process, an analysis is carried out by Antin’s ESG team to identify the ESG issues which are likely to have a material impact on the financial and operational performance of the target company. This analysis is based on our internal ESG materiality assessment framework, as well as various international standards such as the Sustainability Accounting Standards Board (SASB)’s Materiality Map – an interactive tool that identifies and compares ESG issues across different industries and sectors.
Due diligence is then performed by our ESG team, along with external consultants and lawyers where required, to identify specific business risks and opportunities, outstanding liabilities and compliance obligations associated with those issues. Results of that review are documented, shared with the Deal team and presented at Investment Committee meetings.
When relevant, operating and capital expenditures relating to ESG issues are included in the target company’s business plan (e.g. asset maintenance or upgrade to improve a company’s environmental or safety performance). Contingency planning is also performed and documented for potential future ESG risks.
Business transformation and value creation
Antin takes an active role in the companies in which it invests. We aim to acquire majority stakes and when minority stakes are acquired, we seek to acquire the same rights as larger investors by way of Board representation and a list of reserved matters to ensure we retain joint control over the company. Involvement at the highest level allows us to address ESG risks and opportunities directly with our portfolio companies and initiate change where required.
Post-closing, an in-depth ESG review is conducted by Antin’s ESG team, in close collaboration with the Investment team and the portfolio company’s Management team. During this review, a thorough assessment of the portfolio company’s performance in managing key ESG issues identified during the acquisition phase is performed.
The results of that ESG review are used to highlight areas of progress and establish an ESG performance improvement action plan for the portfolio company. Progress towards implementing this plan is monitored by the Investment team throughout the holding period during regular Board meetings and on-site ESG reviews.
Nearing the exit phase, ESG progress achieved by the portfolio company during the holding period is assessed by Antin’s ESG team based on the initial ESG review performed at acquisition. Where possible, the impacts of various ESG factors on the portfolio company’s financials are also measured. When relevant, this information is then incorporated into exit operations to demonstrate business value created through ESG to prospective buyers.
RESPONSIBLE INVESTMENT GOVERNANCE
All Antin employees are engaged in day-to-day responsible investment efforts.
To oversee the implementation of our Responsible Investment (RI) Policy, we have formed a dedicated ESG team, composed of our Performance Improvement Principal, Alex Kesseler, and internal ESG Expert, Felix Heon. Our ESG team works in close collaboration with all of our staff members and portfolio companies throughout the investment cycle, identifying, assessing and managing ESG risks and opportunities. Our ESG team reports directly to Antin’s Executive Committee, which has overall responsibility for all ESG-related matters.
Antin’s Compliance Officer, Wendy Ng, is responsible for overseeing the implementation of our compliance programme, which covers business ethics-related issues, such as bribery and corruption, conflicts of interest as well as corporate gifts and hospitality.
Our Investor Relations team is responsible for communicating to relevant stakeholders (investors, fellow shareholders and other third parties) our approach to responsible investment, as well as ESG progress achieved by our portfolio companies, through periodic reports, conferences and roadshows.