Our approach to ESG
Environmental, social and governance (ESG) factors are essential for the future of the businesses we invest in and for our own operations. By taking sustainability and ESG seriously, we believe our approach to responsible investing can improve the financial performance of our portfolio companies.
Key ESG considerations
Within our firm as well as our investments, we consider environmental, social and governance issues, in particular, we consider the following aspects:
- Waste management
- Energy management and consumption
- Use of natural resources
- Human rights
- Child labor
- Protection of health and safety
- Diversity and inclusion
- Human capital management
- Supply chain management
- Corporate governance
- Anti-bribery and corruption
- Business ethics
- Risk management and control
- Cyber security and data protection
Portfolio company monitoring
We don’t just talk about our ESG commitments. We have established systems in place to analyze and monitor the performance of our portfolio companies. That way we can apply best practice everywhere we operate.
ESG and new investments
When we select companies to invest in, ESG plays a key role in our analysis and decision-making. Our due diligence during the acquisition process incorporates ESG principles. If there are specific ESG issues, this does not prevent us from investing. But it does inform our valuation and provides us with corrective actions that we expect to be addressed.
Exclusion of industry sectors
We work hand-in-hand with our investors to agree which sectors we will and will not invest in. Current exclusions include, inter alia, the tobacco industry, oil and gas exploration and companies whose businesses consist of producing and selling modern weapons.
ESG in portfolio management
We have always worked hard to be a responsible shareholder. Today, that involves using ESG benchmarks as part of our portfolio monitoring processes. We are also active in helping management teams from our portfolio companies to continuously improve.
Performance against ESG criteria are measured by key performance indicators (KPI) individually defined for, and agreed upon with the management of, each portfolio company. Management teams from portfolio companies report the development of these KPIs periodically to us. I turn, we report our portfolio’s overall progress to our investors and to the UN PRI Secretariat.
Our commitment to responsible investing
Halder is a signatory to the United Nations Principles for Responsible Investment (UN PRI). Since 2013, we have used the UN PRI guidelines to enhance how we work and contribute to meeting the sustainability targets of society at large. We also promote diversity in the investment management industry and actively engage with the Level 20 DACH initiative as committee members and mentors.
Industry best practice
Halder is a member of several private equity industry professional associations. On a national level we are part of Bundesverband Deutscher Kapitalbeteiligungsgesellschaften BVK (German Private Equity and Venture Capital Association).