How do we define sustainability?
At EGP, we define sustainability as companies' ability to provide neutral or positive environmental, social and governmental impacts. We want to ensure that each of our portfolio companies will improve their operations to create non-negative impact in their surroundings. Each startup operates in their own industry with their unique business model and therefore the used sustainability measures vary. However, we have set general measures that we follow with each company and in addition to that, there are company-specific KPIs focusing on their specific themes of impact.
Why are we doing this?
We want to be on the right side of the history and follow our values. We see that implementing sustainability considerations to companies operations is only the right thing to do, and the earlier these themes are considered, the easier it will be to make a difference. Also, we believe that in the long run, considering sustainability objectives will yield to positive monetary value.
What are we doing?
As an active owner, we want to support each portfolio company to find the ESG themes that resonate with their strategy. As each of our portfolio company is different, it is important to find the themes that make the most significant impact in the certain industry for the company. Our approach to responsible investing encompasses the whole investment lifecycle – from entry to exit and beyond.
How are we doing it?
Naturally, screening is important and we incorporate environmental, social and governance (ESG) aspects in our initial investment assessments, selection process and exclusionary policies, but we also want to give emphasis on building the sustainable practices along the way. Most of the value lies in the ownership phase and we act as active owners supporting founders every step of the way. Be it in terms of creating an ESG policy, mapping and monitoring sustainability KPIs or executing carbon footprint evaluations and further roadmaps for CO2 neutrality. We follow UN’s Sustainable Development Goals throughout our investment portfolio and adhere to UN’s Principles of Responsible Investment. You can read our Investment Principles here.
Prior to investing we conclude an ESG Assessment to understand where the company stands at the moment and where to navigate further. Knowledge from the management interviews combined with industry specific insights gathered from SASB framework form the basis for the prioritization.
The topics will be discussed through with the company and after detecting the most important themes, we will choose a few KPIs to measure those. After a while, we will also collaborate with the company to compound an ESG Policy, that more broadly assess the level of company's operations in terms of ESG.