We are guided by an in-house environmental, social and governance (ESG) framework which has been formulated based on elements from international standards such as the United Nations Principles for Responsible Investment (UNPRI) and the United Nations Global Compact (UNGC). The framework is designed to incorporate ESG considerations in every stage of our investment process.
Through this framework, we seek to promote responsible corporate practices, in our own organization, in the funds we manage, as well as in the portfolio companies we invest in.
We believe that active management of ESG issues is critical in generating long term value for our investors, stakeholders and employees in a rapidly evolving global landscape. We are committed to promoting sustainability and seek to invest in companies or projects that demonstrate ethical and responsible ESG practices.
While we are cognizant that ESG management typically falls under the purview of equity investors who as shareholders have a greater ability to effect change, we believe that debt investors can also play a role in furthering the ESG agenda. From a business perspective, we also believe that ESG issues can have a potentially material adverse impact on a company’s bottom-line if left unaddressed.
ESG considerations are therefore an integral part of holistic risk analysis, and companies with sound ESG practices essentially represent lower-risk investments. Lastly, as a private credit investor focused on downside risk protection, analysis of such ESG factors is wholly consistent with our goal of delivering optimal risk-adjusted returns.