Environmental, Social, And Governance Investing
Palistar believes that Environmental, Social, and Governance (“ESG”) factors are an important driver of long-term investment returns from both an opportunity and a risk-mitigation perspective.
Palistar seeks to integrate ESG considerations across its investment management processes, operations, and those of its portfolio companies. We have developed tools to support our teams with the goal of systematically and consistently factoring ESG into investment decisions and having a governance framework that oversees implementation of our Responsible Investment Policy.
Palistar will generally consider Environmental, Social, Corporate Governance, and Business Integrity Factors affecting our portfolio companies and other investments, both pre-investment during the course of due diligence, and post-investment as part of our monitoring procedures, as commercially practicable and where consistent with our fiduciary responsibilities.
Although ESG considerations are bespoke to every investment, there are ESG factors that Palistar considers to be material for most investments and important to Palistar’s stakeholders. Example ESG factors that can be material for Palistar’s investments and portfolio companies include:
- Regulatory compliance
- Environmental management and contamination risks
- Land use and biodiversity
- Resource productivity
- Climate change risk, resilience and opportunities
- Health and safety
- Labor and employee practices
- Connectivity and culture
- Community and stakeholder relations
- Diversity and inclusion
- Compliance and ethical business conduct
- Lobbying and conflicts of interest
- Risk management
- ESG oversight
Our PRI Commitment
Palistar has been a Principles for Responsible Investment (“PRI”) signatory since 2021. The Principles for Responsible Investment were developed by an international group of institutional investors reflecting the increasing relevance of environmental, social and corporate governance issues to investment practices. In this fiduciary role, we believe that ESG issues can affect the performance of investment portfolios (to varying degrees across companies, sectors, regions, asset classes and through time).
In signing the Principles, we as investors publicly commit to adopt and implement them, where consistent with our fiduciary responsibilities. We also commit to evaluate the effectiveness and seek to improve our application of the Principles over time. We believe this will improve our ability to meet commitments to beneficiaries as well as better align our investment activities with the broader interests of society.
6 While Palistar seeks to integrate certain ESG factors into its investment process in accordance with its Responsible Investing Policy and subject to its fiduciary duty and any applicable legal, regulatory or contractual requirements, there is no guarantee that Palistar’s Responsible Investment Policy will be successfully implemented or that its investments create a positive ESG impact. In addition, applying ESG factors to investment decisions is qualitative and subjective by nature, and there is no guarantee that the criteria utilized by Palistar or any judgment exercised by Palistar, reflects the beliefs or values of any particular investor. There are significant differences in interpretations of what positive ESG characteristics mean by region, industry and issue, and these interpretations are rapidly evolving.
Since 2019, Palistar has taken steps to bolster our practices and has set goals to continue to strive to improve.
- Developed a Responsible Investment Policy
- Advanced our Responsible Investing Policy
- Participated in ESG conferences
- UN-supported Principle for Responsible Investments (PRI) signed
- ESG Committee established
- Standardized ESG due diligence checklists
- Quarterly and annual monitoring of certain portfolio company ESG factors established