Sustainability

We Stand for Sustainable Investments
and Good Entrepreneurship

Sustainability

Sustainable
Corporate Management

The topic of ESG – Environmental Social Governance – is becoming increasingly important for the society, investors, and regulators. We promote out of conviction social and environmental initiatives among our portfolio companies, thereby creating trust, values and a competitive advantage. Together for sustainable and successful entrepreneurship.

Responsible Investment Strategy

Beyond Capital Partners considers sustainability risks and value creation potential at every step of the investment process, from the selection of potential companies, due diligence and investment decision-making to all activities within the holding period and potential divestiture of one of our portfolio companies.

An essential part of our personal and professional understanding and values of doing good business and generating valuable returns is to participate in the sustainable development of our environment, our society and economy. In particular, but not conclusively, the following areas are close to our hearts:

Good Entrepreneurship
Climate action
Comprehensive and Valuable Education and Support
Diversity, Equality & Inclusion
Well-Being and Mental Health

To act in accordance with our values, we committed ourselves to adopt and implement the UN-supported principles for responsible investing (PRI) and to promote the following SDGs (UN Sustainable Development Goals) by advising and supporting our portfolio companies on initiatives and measures, that positively contribute to the following goals:

Beyond Capital Partners
Responsible Investment Strategy

To act in accordance with our values, we committed ourselves to adopt and implement the UN-supported principles for responsible investing (PRI) and to promote the following SDGs (UN Sustainable Development Goals) by advising and supporting our portfolio companies on initiatives and measures, that positively contribute to the following goals:

Through this, we want to ensure that the 3rd party capital provided to us is invested sustainably and with the greatest possible prudence and has a positive impact on the environment and society through our investments. Furthermore, Beyond Capital Partners is a signatory of PRI (Principles for Responsible Investment), the UN Global Compact, Member of the German Private Equity Association and an active supporter of Level 20.

Our three Beyond Capital Partners’ team members – Helena Hausen, Bianca Bertsch und Lena Bürger – are part of the non-profit organization Level 20. In addition, we support the initiative at senior management level. Christoph D. Kauter, CEO and founder of Beyond Capital Partners, acts as mentor. Beyond Capital Partners supports as sponsor Level 20’s mission to encourage greater female representation across the private equity industry with the goal of having 20% of senior positions in the industry held by women and with a particular focus on increasing the number of women in investment roles. Level 20 was founded in the UK in 2015 and currently has more than 4,000 members worldwide. In 2018, the initiative was also launched in Germany and has already gained more than 100 members.

What are the cornerstones of our ESG Risk Management?

Beyond Capital Partners recognizes the importance of identifying, assessing and managing material sustainability risks as an integral part of its business. Our formal investment strategy (Responsible Investment Strategy) outlines how sustainability aspects are embedded in all decision-making processes along the investment cycle and at Beyond Capital Partners’ corporate level as part of our “ESG along the Investment Cycle” program – particularly with regard to environmental, social and governance issues. These guidelines apply to all affiliated companies.

Beyond Capital Partners takes numerous sustainability aspects into account before and after the acquisition. These include corporate governance, resilience to climate change and initiatives to mitigate the effects of climate change, carbon emissions, biodiversity, resource efficiency, health and safety, education and training of relevant stakeholders, social engagement, labor and employment practices, etc.

Beyond Capital Partners
Responsible Investment Strategy

Beyond Capital Partners
Sustainability Report 2023

Integration of Sustainability Risks into Investment Decision-Making Processes

ESG and sustainability risks and value drivers are taken into account at all stages of the investment process for each individual investment opportunity. In addition to clear exclusion criteria, which narrow down the selection of potential investment objects in the first step, the investment team is obliged to carry out an ESG due diligence review together with an external provider. Furthermore, an ESG profile is created on the basis of an internal, digital ESG questionnaire created by Beyond Capital Partners, which queries the company’s sector-specific, material ESG risks and value drivers.
The results of the internal and external ESG risk analysis are a key component of the decision-making basis for the Investment Committee’s review of the investment project.

The aim is to ensure the greatest possible transparency of potential risks and value creation potential in the area of sustainability and to initiate appropriate measures to minimize risks as early as possible. Serious concerns regarding ESG principles and/or issues in areas that are considered unethical or not in line with acceptable ESG practices – if these cannot be remedied or are unlikely to be remedied – will result in termination of the investment process.

Beyond Capital Partners
PAI Statement

Governance

Key elements of Beyond Capital Partners’ ESG Governance:

ESG Responsibility

Beyond Capital Partner has made key staff members responsible/accountable for ESG issues. Overall ESG responsibility lies at Managing Partner level, ESG supervision and development resides with the Head of ESG.

ESG Training

The Managing Partners and Head of ESG are obliged to undergo regular training and further education and to participate in industry-specific discussion groups and conferences as well as offers from cooperation partners (PRI, Level20, etc.) to ensure that Beyond Capital Partners is always up to date and can pass this on to the investment teams. Furthermore, all members of the Deal Execution & Portfolio Team and the Corporate Team regularly participate in ESG training and thematic updates conducted by our Head of ESG. The portfolio management team and the ESG managers of the portfolio companies participate in the quarterly ESG Roundtables and the annual Portfolio Days, where ESG is a thematic focus.

ESG Policy

Beyond Capital Partners has developed a sophisticated ESG Policy which is being enhanced and checked at regular intervals for up-to-dateness, approved on a Managing Partner level and shared among all team members on a regular basis.

ESG Due Diligence

External ESG due diligence (by third-party providers) is a mandatory part of every investment project. Furthermore, a Beyond Capital Partners internal, digital ESG questionnaire is mandatory in the run-up to each transaction. Both are included as an ESG risk and value driver profile in the document for the relevant investment committee meeting and are used, among other analyses, for decision- making purposes.

ESG Reporting

In 2023, a comprehensive, digital ESG reporting system was set up for Beyond Capital Partners and all relevant portfolio companies in accordance with the requirements of the Sustainable Finance Disclosure Regulation (SFDR), as well as the requirements of investors and portfolio management, to ensure continuous measurement and targeting of environmental and social objectives.

ESG along the Investment Cycle*

We invest in and work with our portfolio companies in accordance with the Principles for Responsible Investment (PRI) and the UN Global Compact.

Principal Adverse Impacts Statement (“PAI”)

The Sustainable Finance Disclosure Regulation (“SFDR”) requires Beyond Capital Partners to make a “comply or explain” determination as to whether the principal adverse impacts (“PAI”) of its investment decisions on sustainability factors are considered in accordance with a specific rule described in the SFDR. Beyond Capital Partners has chosen not to comply with this regulation at company level in accordance with Art. 4, both generally and in relation to the Beyond Capital Partners Funds I and II.

Beyond Capital Partners has carefully considered the requirements of the PAI regime in Article 4 of the SFDR and in the draft regulatory technical standards published in April 2020 (the “PAI regime”). Beyond Capital Partners supports the policy objectives of the PAI regime to improve transparency for clients, investors and the market and how financial market participants integrate consideration of the negative impact of investment decisions on sustainability factors. However, for the portfolio companies of Funds I and II, the available data is not sufficient in quality and scope to fully comply with the reporting requirements of the PAI regime.

Notwithstanding Beyond Capital Partners’ decision not to comply with the PAI requirement for Funds I and II, Beyond Capital Partners has established and implemented a variety of ESG-related initiatives and policies as part of its overall commitment to ESG, as summarized above. For the avoidance of doubt, none of the information is intended to create the impression that Beyond Capital Partners complies with the PAI requirements for Fund I and II.

For Beyond Capital Partners Fund III, Beyond Capital Partners has decided to comply with the PAI and as part of this decision has prepared PAI reporting in accordance with the requirements of the SFDR Art. 8.

Beyond Capital Partners
PAI Statement

Remuneration Policy

Beyond Capital Partners (along with its subsidiaries and controlled affiliates) has established a remuneration policy (the “Policy”) applicable to all Beyond Capital Partners entities. The Policy is developed, approved, implemented, and monitored by the Managing Partners. The Policy applies to all employees of Beyond Capital Partners, save for limited exceptions.

The Policy has been developed with the aim of supporting Beyond Capital Partners’ business strategy, corporate values, and long‐term interests, including by facilitating the identification, assessment and management of sustainability risks when determining individual remuneration packages. The key principles of the Policy include fostering appropriate risk culture (including with respect to the management of actual and potential conflicts of interest) and compliance with applicable law and regulation.

The performance management and rewards framework envisioned by the Policy has been designed to promote effective risk management, including in particular by:

Ensuring that assessment of performance takes full account of adherence to risk management requirements, covering all relevant types of current and future risks, including sustainability risks.
Implementing deferral arrangements using co‐investment and carried interest arrangements for senior personnel, facilitating alignment of interests between staff‐members and third-party investors. If the value of the relevant underlying investment portfolio should decrease (whether arising because of a sustainability risk or otherwise), the value of the employee’s holdings will be reduced accordingly.
Providing for reduction of variable remuneration awards – if applicable – to senior personnel in certain circumstances, such as in the event that the entity in which the relevant employee works suffers a significant failure of risk management or experiences a significant downturn in its financial performance (as determined in the sole discretion of Beyond Capital Partners), including in connection with a sustainability risk concerning an investment.