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APAX PARTNERS LLP

PRI reporting framework 2020

You are in Direct – Private Equity » Pre-investment (selection)

Pre-investment (selection)

PE 05. Incorporating ESG issues when selecting investments

05.1. During due-diligence indicate if your organisation typically incorporates ESG issues when selecting private equity investments.

05.2. Describe your organisation`s approach to incorporating ESG issues in private equity investment selection.

The Apax investment team undertakes standard pre-investment Environmental, Social and Governance (ESG) due diligence for each new investment made by the funds.  The due diligence is based on a detailed questionnaire which  has been drawn up to cover the ESG areas which Apax believes are key to understanding the ESG profile of the company in which  the funds are  considering an investment.

Prior to the closing of each new investment by the Funds, the findings of the ESG due diligence process are reviewed by a member of the Apax Sustainability Committee and incorporated into the final Investment Committee documentation.  Key ESG issues, representing either a risk to the portfolio company’s business or an opportunity for value creation, are highlighted as part of this process.  Where necessary, investment professionals will work with the relevant company’s management team to develop an improvement plan to address findings post-investment, either in the 100-day planning process or shortly thereafter.

The objective is to create a high degree of awareness upfront with regards to potentially relevant ESG issues which can contribute to value creation at a very early stage of ownership of the company.

The Apax investment team members are very knowledgeable about the key areas of Environmental, Social and Governance risk within their sub sectors due to their extensive sector expertise. In certain cases the team brings in additional external expert resources to further assist in benchmarking and understanding the specific risks inherent in the company under consideration.

05.3. Additional information. [Optional]


PE 06. Types of ESG information considered in investment selection

06.1. Indicate what type of ESG information your organisation typically considers during your private equity investment selection process.

06.2. Describe how this information is reported to, considered and documented by the Investment Committee or similar.

Apax investment professionals undertake pre-investment ESG due diligence for each new investment made by the Funds.  The focus of the due diligence may vary but, in all instances, will cover the ESG areas that Apax believes are key to understanding the ESG profile of the particular company in which the Funds are considering an investment. 

Prior to the closing of each new investment by the Funds, the findings of the ESG due diligence process are reviewed by a member of the Apax Sustainability Committee and incorporated into the final Investment Committee documentation.  Key ESG issues are highlighted as part of this process.  Where necessary, investment professionals will work with the relevant company’s management team to develop an improvement plan to address findings post-investment, either in the 100-day planning process or shortly thereafter.

During such time, the OEP’s extensive knowledge and expertise regarding business operations is routinely tapped into by Apax investment professionals for insight into how, among other things, a target company’s existing operations might be optimized, ESG risks can be addressed and mitigated, and avenues for value creation can be unlocked during the Funds’ ownership tenure.


PE 07. Encouraging improvements in investees (Private)


PE 08. ESG issues impact in selection process (Private)


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