ESG & Taxonomy Disclosure
The Fund may be exposed to some Sustainability Risks (as such term is defined in the EU Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability-related disclosures in the financial services sector). The General Partner considers these aspects and risks within its risk management procedures (identify, monitor and mitigate ESG risks) and focuses on the most important risks for every targeted asset. Although the General Partner considers Sustainability Risks in its investment decision-making process, it does not consider the “principal adverse impacts”, if any, of its investment decisions. This approach is based, amongst other factors, on the perceived lack of reliable, high-quality data on these factors, which prevents the General Partner from being able to decisively conclude whether an investment decision’s actual or potential adverse impact may affect the intrinsic value of the Fund’s investments. Such Sustainability Risks are integrated into the investment decision making and risk monitoring only to the extent that they represent a potential or actual material risks and/or opportunities to maximizing the long-term risk-adjusted returns.
The Regulation (EU) 2020/852 of 18 June 2020 on the establishment of a framework to facilitate sustainable investments (“Taxonomy Regulation”), and amending the SFDR establishes a classification system (or taxonomy) which provides businesses with a common language to identify whether or not a given economic activity, including a financial activity, should be considered “environmentally sustainable”. This, then, allows it to be determined how far an investment is environmentally sustainable, or ‘green’. Standardising the concept of environmentally sustainable investment across the EU is meant to both: (a) facilitate investment in environmentally sustainable economic activities; and (B) help economic operators attract investment from abroad more easily.
An economic activity will be considered to be “environmentally sustainable” where it: (i) contributes substantially to any of a series of defined environmental objectives; (ii) doesn’t significantly harm any of the environmental objectives; (iii) complies with a series of minimum social safeguards; and (iv) complies with specified performance thresholds known as “technical screening criteria”. The first two points above refer to ‘environmental objectives’ and the TR defines these as being: (i) climate change mitigation; (ii) climate change adaptation; (iii) sustainable use and protection of water and marine resources; (iv) transition to a circular economy; (v) pollution prevention and control; and (vi) protection and restoration of biodiversity and ecosystems. The investments underlying the financial product managed by the General Partner do not take into account the EU criteria for environmentally sustainable economic activities.