1. Integration of sustainability risks (Article 3 SFDR)
EMH Partners GmbH (“EMH”) considers sustainability risks as part of its investment process. Sustainability risks — environmental, social or governance events or conditions that could have a material adverse effect on the value of an investment — are assessed alongside financial and operational risk factors throughout the investment lifecycle. EMH applies a sector-based and materiality-based approach, focusing on the risks most relevant to the sector and business model of each investee company. Prior to investment, potential exposures are identified through a structured ESG due diligence process and presented to the Investment Committee. Post-investment, material sustainability developments at portfolio company level are monitored on an ongoing basis.
2. Principal adverse impacts (Article 4 SFDR)
EMH does not publish a principal adverse impact statement pursuant to Article 4(1)(a) SFDR. With fewer than 500 employees, EMH is not subject to the mandatory PAI reporting obligation under Article 4(3) SFDR.
EMH considers certain adverse impacts on sustainability factors as part of its investment process. The mandatory exclusion framework applied prior to each investment addresses areas of potential adverse impact, and ESG data collected from portfolio companies on an annual basis includes governance-related indicators relevant to the assessment of adverse impacts. EMH will keep its approach under review as data availability improves and regulatory practice develops, including in light of the proposed revision to SFDR (SFDR 2.0).
3. Remuneration policy (Article 5 SFDR)
EMH integrates sustainability risks into its investment decision-making process. Sustainability risks are not, however, embedded in EMH’s remuneration practices.