August 30, 2020

Strong focus on sustainability: A-rating from UN PRI

By Evli Growth Partners
We're extremely glad and proud to be acknowledged with an A-rating from UN PRI. However our sustainability work is just beginning, and we look forward to supporting our portfolio companies even more going forward.

At Evli Growth Partners we’ve started several actions to better help our portfolio companies with their sustainability efforts. Whether working on ESG Policies, KPIs, Carbon footprint mapping or improving the corporate culture – we’re here to help! As active owners we see sustainability as one of the core components in ensuring resilient, long-term business models. Our portfolio companies reflect this in different ways across daily operations. In Refurbed’s case decreasing the carbon emissions of smartphones and other electronics by 70%, while Tier has introduced swappable batteries and green energy in charging its fleet. These are just a few examples, and we look forward to discovering and introducing many more success cases to our portfolio.

From swappable batteries and carbon offsetting to improved corporate culture and diversity – our startups work actively across sustainability

The sustainability efforts and activities we’ve taken onboard this year have been well reflected in our excellent A-rating from the UN PRI. This year, for the very first time, we started reporting according to the PRI and will continue to do so annually.

So what is the PRI? As with so many other acronyms, PRI is often referred to but still unknown to many. In a nutshell the UN Principles for Responsible Investment include six principles that signatories commit to and report by annually. Launched in April 2006, the PRI has over 2,300 participating financial institutions as of January 2020 .The annual reporting then, evaluates to what extent the signatory performs on different ESG indicators. These indicators cover the whole investment lifecycle from pre-deal to exit and include areas such as how well ESG criteria is included in investment selection, investment documentation, LP reporting and how open and transparent the disclosure is.

A-score given our investment selection, open disclosure and activeness with our portfolio companies

Looking at our scoring, a total 28 points out of 30, the clear miss from a top score was given the voluntary nature of our actions and reporting. However, in our view as active owners it’s our responsibility to include sustainability into every investment decision, since it very much drives business value and potential, even more so going forward. On the other hand, the points driving our high score were mainly four areas listed below.

1. ESG information considered in investment selection

This first point is applicable to our daily operations. In each company that we pre-screen, meet with, analyze, perform a DD or finally decide to invest into, we take ESG into consideration. As one of our slogans states “we fund good people, not tobacco companies”. Albeit cheezy, it’s however true. Going deeper, we perform a comprehensive ESG assessment in the due diligence phase prior to the investment. This also lays the ground work for when the real work and value creation actually starts, post-investment.

2. ESG performance monitored

As for the performance monitored, we’ve taken on several initiatives for instance by incorporating ESG into the Shareholders’ Agreement and including an ESG Policy, which we work on together with our companies post-investment. The aim here is, as with any strategy development process, to map our the key sustainability risks and opportunities and focus areas in form of KPIs going forward.

3. Actions taken by portfolio companies

When it comes to our portfolio, as referred to in the very beginning, we are super proud of our companies’ efforts. Whether working towards worldwide access to audio content in the case of Acast, or improving working culture and implementing fully remote working practices in the case of Klevu, all our companies have a strong impact focus.

4. Public and open disclosure

Finally with disclosure, as with this post, we aim to disclose on all our actions and achievements (good or bad). For more information on our companies’ ESG initiatives read more at EGP/portfolio. And access our full PRI report at EGP 2020 Assessment Report.

As a final highlight, although we are just in the beginning of our journey together with a bunch of wonderful success cases, we look forward to introducing new ones to our portfolio. If you’re an impact-driven startup looking to strengthen your value proposition, or just starting your sustainability journey, we’re happy to network and discuss more around these topics. Do get in touch!

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