This page provides investors and stakeholders information on sustainability related matters of Incofin IM and its funds, as required under the regulation on sustainability-related disclosures in the financial services sector (EU/2019/2088) (hereinafter “SFDR”).
Incofin IM is SFDR-aligned and all our AIFM funds are in line with Article 9 or “dark green” classification, having sustainable investments as an objective. As an impact investor, Incofin IM seeks to invest in companies that are not only financially sustainable, but also contribute to solving socio-economic problems, while avoiding harm to its end-clients, local communities, and the environment in which it invests. We have fulfilled the disclosure requirements laid out in the SFDR, as described below.
Sustainability Risk Policy
Our Sustainability Risk policy describes our approach to sustainability, including how sustainability risk assessment is integrated into the investment decisio-making process under Article 3 of SFDR.
Incofin considers the sustainability risk of all investments from a double materiality perspective:
- Inside-out: the impact of our organisation and investments on the sustainability factors in the outside world, resulting in positive and/or negative impact.
- Outside-in: the impact of sustainability factors in the outside world on our organisation and investments, resulting in sustainability risks..
Principal Adverse Impact Statement
Incofin IM has opted-in to report on the Principal Adverse Impact (PAI) indicators of our portfolio companies as defined by Article 4 of SFDR, including indicators on greenhouse gas emissions, biodiversity, water emissions, waste, social violations and governance issues, for all the funds we manage and advise. In addition, Incofin IM will report on at least one additional environmental indicator and at least one additional social indicator as required by the regulation. The first quantitative reporting is due on June 30th, 2023 for the reference period of January 1st to December 31st, 2022.
As our funds do not have explicit environmental objectives, some environmental-specific PAI indicators are not currently track (i.e. GHG emissions, biodiversity, water emissions, etc.). However, the social and governance PAI indicators are largely already part of our processes. To comply with the SFDR, we will start tracking all the mandatory PAI indicators.
Given the pioneering target investment sector, availability of data is a challenge for identifying the PAI indicators. Incofin IM has been working with its impact investor peers through the Social Performance Task Force (SPTF), a financial inclusion network of over 4,500 members, to standardize methodologies, metrics, data collection and reporting of the PAI indicators. A pilot test is in progress to test the quality of the data, with the aim to finalize the methods, metrics and tools by December 2022, ahead of the June 2023 deadline.
Our Remuneration Policy was updated to ensure consistency with our Sustainability Risk Policy as required under Article 5 of SFDR.
The Remuneration policy has been designed to ensure employees are rewarded for behaviour that upholds a culture aligned with the interests of our clients and shareholders, and specifically to encourage responsible behaviour that supports long-term sustainability, ESG and impact goals. Two key aspects of the Remuneration policy that reflects the sustainability principle are:
- Variable components are modest relative to the fixed remuneration as to not create an adverse incentive;
- Part of all staff’s performance-based remuneration depends on achievements of sustainability, ESG and impact goals, as set and agreed between employees and direct managers at the start of the year.
Article 9 disclosures
All our proprietary and self-managed funds classify under Article 9 of SFDR. Please see below for fund-specific disclosures.