Marondo Capital GmbH ESG Policy
Marondo Capital GmbH (“Marondo Capital”) acknowledges the importance of responsible investment, and that sustainability plays a major part in the way Marondo Capital builds long-term business success. The purpose of this policy is to outline Marondo Capital’s approach to responsible investment throughout the investment, ownership, and exit phases of the investment process. Marondo Capital believes that attention to Environmental, Social and Corporate Governance (ESG) matters is crucial for long-term value creation.
I. Compliance with United Nations Principles of Responsible Investment
Marondo Capital commits to adhere to the United Nations Principles of Responsible Investment (“UN PRI”) in line with its fiduciary responsibilities towards its investors:
- Marondo Capital will incorporate ESG issues into its investment analysis and decision-making processes.
- Marondo Capital will be an active owner and incorporate ESG issues into its ownership policies and practices.
- Marondo Capital will seek appropriate disclosure on ESG issues by the entities in which it invests.
- Marondo Capital will promote acceptance and implementation of the UN PRI within the investment industry.
- Marondo Capital will work together to enhance its effectiveness in implementing the UN PRI.
- Marondo Capital will report on its activities and progress towards implementing the UN PRI.
II. Compliance with Ten Principles of the United Nations Global Compact
Marondo Capital abides by, and actively encourages its portfolio companies to consider, the Ten Principles of the United Nations Global Compact:
- Human Rights: Businesses should support and respect the protection of internationally proclaimed human rights; and make sure that they are not complicit in human rights abuses.
- Labor: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining; the elimination of all forms of forced and compulsory labor; the effective abolition of child labor; and the elimination of discrimination in respect of employment and occupation.
- Environment: Businesses should support a precautionary approach to environmental challenges; undertake initiatives to promote greater environmental responsibility; and encourage the development and diffusion of environmentally friendly technologies.
- Anti-Corruption: Businesses should work against corruption in all its forms, including extortion and bribery.
III.Responsible Investment Focus Areas
To maximize the potential impact of Marondo Capital’s ESG efforts, Marondo Capital aims to equip its portfolio companies to achieve long-lasting results by providing the guidance and resources to help them develop sustainable business practices.
Marondo Capital believes that a company that is aware of its impact on the environment is better able to manage associated risks and is more likely to have a long-term sustainable business model in place. Marondo Capital encourages companies to use energy efficiently, lower greenhouse gas emissions, use water responsibly, reduce waste, and choose sustainable materials when sourcing.
Marondo Capital respects the rights of workers and believes that good relationships between managers, employees, suppliers, and business partners lead to better results. Respecting labor rights, providing a safe work environment, and protecting consumers are prioritized within the portfolio company. Marondo Capital rejects the use of any form of forced, child, or compulsory labor. Marondo Capital encourages the promotion of diversity and does not tolerate discrimination on the basis of age, gender, marital or parental status, sexual orientation, ethnic or national origin, political affiliation, physical ability, appearance, education, or religious background.
Marondo Capital engages with its portfolio companies to encourage strong corporate governance. An essential part of its value creation model is the governance structure that is put in place for each portfolio company. The board of directors of each portfolio company is responsible for defining strategy and policy, and Marondo Capital expects this to include the setting of sound ESG standards. Marondo Capital expects its portfolio companies, as well as their suppliers and business partners, to conduct business in an ethical manner at all times – working against corruption in all of its forms, promoting a culture of good governance, and seeking necessary and positive engagement with key stakeholders.
IV. Responsible Investment Process
1. Investment Phase
When evaluating a potential investment, Marondo Capital’s investment professionals identify and assess material risks and opportunities related to ESG matters. Reasonable steps are taken to mitigate ESG-related risks. Marondo Capital’s legal team, together with external advisers as needed, provide necessary support in conducting this review.
2. Ownership Phase
During the phase of its investment in the portfolio company, Marondo Capital’s investment professionals assist the portfolio company’s board of directors and management in developing a plan to mitigate ESG risks and capitalize on ESG opportunities. Marondo Capital sets out clear expectations for portfolio companies that are designed to ensure material ESG risks and opportunities are addressed. While the board of directors is ultimately responsible for developing the portfolio company’s sustainability strategy and ensuring it is implemented, Marondo Capital provides guidance to help the company achieve its strategic aims and meet its expectations.
3. Exit Phase
In preparation for the exit phase of an investment, reasonable steps are taken to ensure the portfolio company is positioned to continually improve its ESG performance. The value generated by ESG improvements made during the ownership phase aim to be clarified and realized upon exit.