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APAX PARTNERS LLP

PRI reporting framework 2020

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Outputs and outcomes

PE 14. ESG issues affected financial/ESG performance (Private)


PE 15. Examples of ESG issues that affected your PE investments

15.1. Provide examples of ESG issues that you identified in your potential and/or existing private equity investments during the reporting year.

Investment Stage
ESG issues

ESG issues

          Electronic Waste
        
Sector(s)
          IT Services
        
Impact (or potential impact) on the investment

Reduction in electronic waste

 

Activities undertaken to influence the investment and its response

Since investment the company has developed a virtuous system in its offices that, on the one hand, makes it possible to contain the costs of purchasing new PCs, and, on the other hand, has a more limited impact on the environment, with a lower average standard production of electronic waste linked to PC replacement.

Investment Stage
ESG issues

ESG issues

          Equality
        
Sector(s)
          Healthcare Services
        
Impact (or potential impact) on investment

Continuous improvement of equal pay

Activities undertaken to influence the investment and its response

The company focused on equal pay, in particular on salaries and pay for performance regardless of gender or ethnic background.  It also had a focus on pensions for nurses and technicians, enabling them to get adequate training and help with the placement of their pension funds. 

 

Investment Stage
ESG issues

ESG issues

          Continuous improvement of supply chain working conditions through training and increased audits
        
Sector(s)
          Retail
        
Impact (or potential impact) on investment

Improvement in supply chain working conditions

 

Activities undertaken to influence the investment and its response

The company has been a member of the Fair Wear Foundation since investment by the Apax Funds. The company audits its factories on a regular basis and checks the improvement of social standards and workplace safety. The regular monitoring of the progress to improve the social standards is part of day to day operations. The company  continuously runs training together with the FWF to raise the awareness of the workers and factory management and minimize the supply chain risks.  The company increased the number of social audits with the supply chain  and also implemented a new Code of Conduct

 

Investment Stage
ESG issues

ESG issues

          Waste
        
Sector(s)
          Healthcare
        
Impact (or potential impact) on investment

Increased waste management practices

Activities undertaken to influence the investment and its response

The company implemented resource reduction and waste minimization best practices throughout its manufacturing process and waste disposal activities. The company implemented recycling programs for paper, metals and glass in all global facilities and introduced initiatives to minimize the use of printed materials in its communications and record keeping. It worked with its suppliers to purchase recycled products whenever possible and assisted its suppliers and vendors in developing environmentally friendly products and programs. It selected waste treatment providers that provide single stream recycling and encouraged suppliers to reduce waste in their own operations

15.2. Describe how you define and evaluate the materiality of ESG factors.

The Apax Funds’ portfolio consists of a growing number of “asset light” businesses, due to the Apax focus on four specific sectors which do not have a significant ESG impact: Tech & Telco, Services, Healthcare and Consumer. The most material environmental indicator for 40% of portfolio companies is electricity usage, followed by paper usage and airplane travel.  

The Firm defines materiality as the portfolio companies, which have the largest ESG footprint within the overall portfolio. From a Fund perspective, a small number of companies influence the ESG footprint to a large degree. For example in 2018, 80% of electricity kWh was reported by six portfolio companies and the remaining 20% accounted for by the 15 other reporting companies. Similarly, the Apax Funds’ portfolio contains a small number of large employers. In 2018, 6 companies accounted for over 60% of the overall ESG Group workforce with the remaining 40% of the workforce employed by 26 other portfolio companies.


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