BEX Capital makes the following disclosures in accordance with Articles 3(1), 4(1)(b) and 5(1) of the Disclosure Regulation.
BEX Capital fully supports the mission and ideals of the Principles for Responsible Investment (“PRI”) and is aware that Environmental, Social, and Governance (“ESG”) risks can affect the value of investment portfolios. As an investor in the secondaries market and given the limitations inherent with such a mandate, notably that our focus is on fund-of-fund managers (rather than ESG at the asset level), BEX Capital considers a variety of factors when making investment decisions on behalf of the funds that it manages and recognizes that the consideration of ESG risks are valid parts of the investment analysis and decision-making processes.
A sustainability risk means “an environmental, social or governance event or condition that, if it occurs, could cause an actual or potential material negative impact on the value of the investment”. In the context of BEX Capital, sustainability risks are risks which, if they were to crystallize, would cause a material negative impact on the value of the portfolios of BEX’s funds.
Before any investment decisions are made on behalf of any funds that BEX Capital manages, BEX will have completed a process that evaluates the overall commitment to ESG of the General Partners of the funds of funds, secondary funds and co-investment funds that are proposed as investments to the investments committee. The due diligence process tries to identify, through the General Partners own commitment investigate these risks, the material risks associated with each such proposed investment; these include relevant and material sustainability risks if available. The investment committee assesses all the identified risks alongside other relevant factors set out in the proposal. Following its assessment, the investment committee makes relevant investment decisions having regard to the relevant fund’s investment policy and objectives. Sustainability risks then continue to be assessed throughout the holding period of investments by monitoring efforts made by the General Partners of the funds of funds on this topic.
BEX Capital does not consider the principal adverse impacts of its investment decisions on sustainability factors in the manner prescribed by Article 4 of the Disclosure Regulation.
Article 4 of the Disclosure Regulation requires fund managers to make a clear statement as to whether or not they consider the “principal adverse impacts” of investment decisions on sustainability factors. Although BEX Capital takes sustainability and ESG very seriously, it uses its own procedures, policies and metrics to assess the adverse impacts of investment decisions on sustainability factors which to not align with those prescribed under Article 4 of the Disclosure Regulation, as BEX Capital considers that these are more appropriate and tailored to BEX Capital investment strategy as buyer on the secondary market of funds of funds with limited influence on the behaviour of portfolio companies as regards to sustainability adverse impacts matters.
Accordingly, as our mandate as a secondaries investor prevents us from having management powers or operational responsibility for underlying portfolio companies, BEX Capital does not currently intend to consider the prescribed adverse impacts of their investment decisions on sustainability factors within the meaning of Article 4 of the Disclosure Regulation; however, BEX Capital keeps this situation under ongoing review.
BEX Capital pays staff a combination of fixed remuneration (salary and benefits) and variable remuneration (including bonus). Variable remuneration for relevant staff takes into account compliance with all BEX Capital’s policies and procedures, including those relating to the impact of sustainability risks on the investment decision making process.
