ESG disclosures

Date of publication: 06th of September 2022
Last reviewed 06th of September 2022

At Change Ventures (CV), consideration of environmental, social and governance (ESG) principles is an integral part of our operating procedures.  

Even though at the moment, no environmental or social characteristics are promoted by Change Ventures’ financial products in accordance with Article 8 of SFDR and Change Ventures’ financial products do not have sustainable investments as their purpose in accordance with Article  9 of the SFDR, we  do believe that, in order to make good investments, sustainability factors should not be overlooked.

According to Article 2 (22) of SFDR, “sustainability risk” means ‘’an environmental, social or governance event or  condition that,  if it occurs, could cause an actual  or  a potential  material negative impact on the value of an investment.

Change Ventures, therefore, approaches sustainability risk from the perspective of the risk that ESG events might cause a negative impact on the value of our clients’ investments.  

In order to create lasting stakeholder value, investees must have a prudent approach to the planning and management  of  ESG  policies.  Ignoring  ESG  risks  is  no  different  than  ignoring  technical,  currency  or commercial risks, and could just as likely result in negative financial consequences and lower shareholder value on top of the social and environmental impact.

We consider environmental, social and governance (ESG) principles to be a significant part of our operating procedures  and  we  have  a  Responsible  Investment  Policy  that  outlines  the  relevant  procedures  and processes that help us manage and mitigate sustainability risks in investment decision-making processes.

CV’s approach to assessing sustainability risk factors in investment decision-making process starts with an assessment of ESG factors as they relate to risk management, business effects, profitability and continues through  engagement  with  management at investee  companies  to  ensure ongoing  monitoring  and assessment.

We  assess  performance  against  a  number  of  ESG  criteria,  including  but  not  limited  to  energy,  climate, environmental regulations, labor relations, management capability and integrity, and financial management factors.

We  assess  ESG  issues  as  outlined  in  our  Responsible  Investment  Policy,  which  includes  the  following steps:  
• Screen against excluded and potentially excluded investees;
• Conduct pre-investment due diligence procedure;
• Take responsible investment decisions and follow risk control measures;
• Conduct continuous risk monitoring.

Change  Ventures  does  not  consider  principal  adverse  impacts  (PAIs)  of  our  investment  decisions  on sustainability factors.  

There are several areas where CV must allocate its limited resources and personnel. Considering the size of Change Ventures and its investment funds, conducting a PAI assessment in accordance with SFDR and its delegated acts would tie up a disproportionate amount of CV’s resources. Additionally, currently available ESG  data  is  insufficient  to  fulfill  the  requirements,  which  arise  from  the  regulatory  technical  standards complementing SFDR.

Change  Ventures,  at  the  given  moment,  does  not  intend  to  consider  adverse  impacts  of  investment decisions  on  sustainability  factors  in  the  future  in  accordance  with  article  4  of  the  SFDR  for  the aforementioned reasons.  

Nevertheless, we are aware that our investment decisions, as well as our portfolio entities’ activities, may have an impact on sustainability factors. Therefore, we duly consider the negative impacts of our investment activities  and  report  ESG  data  to  our  investors  and  other  relevant  stakeholders,  as  described  in  our Responsible Investment Policy document.