ESG Policy

Sobera Capital GmbH (“we” or “Sobera Capital”) is a German limited liability company and registered as EuVECA Kapitalverwaltungsgesellschaft with the Bundesanstalt für Finanzdienstleistungsaufsicht (“BaFin”). Sobera Capital focuses on so-called secondary direct transactions, i.e. the acquisition of entire portfolios of direct investments, as well as the acquisition of selected individual companies and private equity funds. The focus of the participations is in the areas of ICT, industrial technologies as well as health care and life sciences as well as mainly in the DACH region.
Sobera Capital wants to create value for investors and portfolio companies in its investments. We are aware of our responsibility to society and nature to contribute to a more sustainable world. That’s why we see sustainability as an integral part of our business model. In order to live up to our commitment to sustainability, we have set ourselves the following ESG policy as a goal to offer benefits to investors and our portfolio companies.
Our ESG commitment respects the principle of proportionality, taking into account the size, nature and scope of our activities, our funds and our portfolio companies. To this end, we will work with our portfolio companies accordingly.
 
1. Scope
We commit ourselves to taking into account and continuously improving this ESG policy both in relation to our own organisation and the resources we manage. Our influence on portfolio companies, including influence on sustainability issues, is usually limited due to the nature of the investments (mainly minority interests). However, Sobera Capital will be committed to ensuring that our portfolio companies also track ESG values.
 
2. ESG values
The aim is to promote sustainable practices both in Sobera Capital and our funds and in our portfolio companies. The following guidelines are intended to support the continuous and dynamic development of sustainable business practices that create and exploit ESG-related value creation opportunities.

a) Environment
· Climate action
· Adaptation to climate change
· Protection of biodiversity
· Sustainable use and protection of water and marine resources
· Transition to a circular economy, waste prevention and recycling
· Pollution prevention and control
· Protecting healthy ecosystems
· Sustainable land use
 
b) Social affairs
· Compliance with recognised labour standards, i.e. no child and forced labour, no discrimination
· Compliance with occupational safety and health protection
· Adequate remuneration, fair working conditions, diversity and opportunities for training and training
· Freedom of trade union and assembly
· Ensuring adequate product safety, including health protection
· Equal requirements for companies in the supply chain
· Projects or consideration of the needs of communities and social minorities
 
c) Governance
· Tax compliance
· Measures to prevent corruption
· Sustainability management by the management
· Management remuneration depending on sustainability
· Enabling Whistle Blowing
· Guaranteeing workers’ rights
· Ensuring data protection
· Disclosure of information
 
d) Exclusion list for investments
Sobera Capital has defined exclusion criteria. Portfolio companies that focus their activities in the following areas shall in principle be excluded from an investment:
· Manufacture, processing, distribution, sale of tobacco products
· Investment in arms
· Operation of gambling facilities
· Manufacture, distribution, sale of alcoholic beverages
· Production, distribution, sale of pornography
· Extraction, refinement, distribution, sale of fossil fuel-based energy production
· Investing in corrupt countries
· Energy-intensive and/or highC0 2emission industries
 
3. Implementation in investment processesn
We see our ESG values as part of every phase of the investment and value creation process. Therefore, we consider our ESG values both in the investment audit phase and in the investment phase.

Investment audit phase

In the investment audit phase, we take our ESG values into account when screening for companies and in carrying out our due diligence processes. Companies undergo a decision-making process in which environmental, social and governance criteria must be met. We identify and evaluate possible ESG-related value creation opportunities before we make an investment decision. Risks are ­identified and classified in high, medium and low probability of damage, assessed and necessary measures taken.

Investment phase

During the investment phase, the ESG Action Plan will be implemented by the portfolio company. Sobera Capital supports the companies if necessary. We will report to our investors on ESG-related topics of our funds and portfolio companies.
We encourage our portfolio companies to conduct ongoing reporting on ESG developments in their company as part of the board­or investor reporting.
 
4. Risk management

We are aware that sustainability risks can also have a negative financial impact on investments on a case-by-case basis or allow us to exclude financially promising investments.
Environmental events or conditions are events or conditions that may have a negative impact on the environment, e.g. in relation to key resource efficiency indicators related to the use of energy, renewable energy, raw materials, water and land, waste generation and greenhouse gas emissions, and the impact on biodiversity and its circular economy. I.d.R. our investments have a very low ESG risk due to their nature and industry affiliation.
Social events or conditions are events or conditions that may adversely affect a social matter, such as combating inequality or discrimination or inclusion, promoting social cohesion, social integration and industrial relations, or investing in human capital or economically or socially disadvantaged communities. The relevant criteria are checked by consulting relevant information and company visits and the risk is generally considered to be very low.

Governance events or conditions are events that may adversely affect governance, such as sound management structures, employee relations, remuneration of relevant staff, tax compliance, financial monitoring (audit) and effectiveness of the management body, respect for human rights, the fight against corruption and bribery. Here too, the risk of our investments is generally very low.

Our risk management processes take into account such sustainability risks within the risk categories Credit risk/counterparty credit risk,­ market risk, liquidity risk, operational risk, strategic risk, reputation risk through early and effective detection,­ mitigation or offsetting of such risks. To this end, we have­ integrated a number of related issues into our investment due diligence checklist, our post-investment ESG Action Plan, and monitoring and support procedures.
 
5. Responsibilities
Our team consists of experienced investment professionals who are jointly responsible for our adherence to this ESG policy in all relevant investment decisions and monitoring processes. In addition, we have a network of consultants we work with if necessary. It is the responsibility of the ESG representative to comply with the guidelines and, in cooperation with the management and the respective portfolio manager, to effectively monitor the ESG performance of the portfolio companies and to actively cooperate with the management of the portfolio companies to improve ESG performance.

Portfolio companies should report on their ESG measures at least once a year (if necessary).

The management regularly reports to investors as part of the defined reporting (at least once a year).

There is an annual reporting by the ESG manager to the management.

Compliance with the SFDR disclosure ordinance is regularly monitored by the management.

This document was prepared or last updated on 07.12.2021.
 
The Management Board
Sobera Capital GmbH