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Oak Hill Capital Partners

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.

Over the past seven years, we have embedded ESG analysis into our due diligence process for new investments (further detailed below). Every potential investment presented to our Investment Committee includes a detailed analysis of potential ESG risks and opportunities. We research and analyze both macro-level and company-specific issues with a focus on environmental sustainability, responsible sourcing, and employee relations.

For each potential investment, we create a checklist of areas to cover and data to analyze. Depending on the nature and materiality of ESG issues, we may also engage with Business for Social Responsibility (BSR), a leading nonprofit sustainability research and consulting organization, for additional expertise.

Phase I:

The firm considers whether the deal team should explore the opportunity. Deal teams brief the ESG Committee on the potential investment and an initial ESG screen is conducted around the fundamental premise of the business. This could result in the termination of any further diligence if the company's business model conflicts with the firm's Responsible Investment Policy.

Phase II:

The firm reviews the investment to determine whether it merits full scale due diligence and incurring significant diligencerelated
costs. Oak Hill considers the key ESG risk and opportunities through a preliminary ESG assessment. We set forth a road map for further diligence.

Phase III:

The ESG Officer obtains answers to specific ESG-related questions through meetings with the company's management team, review of company data, and discussions with external advisors.  Presentations to the Investment Committee include necessary information related to any ESG concerns raised during Phase 2.

Prior to Signing:

The company’s ESG data is compared against Oak Hill’s Responsible Investment Policy. As needed, Oak Hill’s Investment Committee discusses material ESG issues in the final diligence meeting with the company’s management team.

Closing:

If the company has material environmental and/or social impacts, then Oak Hill’s investment professionals and ESG Officer coordinate a plan for engagement and monitoring.

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.

The Investment Committee is informed of relevant ESG information during deal team presentations regarding the potential investment (pre and post third party diligence) through materials and discussion.  


PE 07. Encouraging improvements in investees (Private)


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


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