UK firms which opt into the SFDR as the delegated investment manager to an EU firm must ensure that they publish information on their websites about their sustainable risk policies (Art 3), consideration of principal adverse impacts on sustainability factors (Art 4) and remuneration policies (Art 5). In line with these requirements, Adelio Partners (which has opted-in with respect to the Adelio UCITS Fund) has outlined its approach.
Sustainable Risk Policies
Adelio Partners Limited is required to publish information on its website about its policies on the integration of sustainability risks in its investment decision-making process. A sustainability risk is an environmental, social or governance event or condition that, if it occurs, could cause an actual or a potential material negative impact on the value of the investment.
For Adelio Partners Limited, sustainability risks are risks which would cause a material negative impact on the value of the portfolios it manages. Adelio Partners Limited’s investment process aims to identify the material risks associated with each proposed investment before it is made, including the relevant sustainability risks.
Adelio Partners Limited’s ESG policy explains how sustainability risks are considered in its investment decision-making process and is available at ESG (adelio.com).
Principal Adverse Impact Reporting
Adelio Partners Limited is required to disclose on its website whether or not it considers the adverse impacts of its investment decisions on sustainability factors in the selection of investments. Sustainability factors are environmental, social and employee matters, respect for human rights, anti-corruption and anti-bribery matters. If Adelio Partners Limited considers the adverse impacts of its investment decisions on sustainability factors it is required to publish information describing its policies and procedures in this regard. If Adelio Partners Limited does not consider the adverse impacts of investment decisions on sustainability factors it must disclose this and explain why.
Adelio Partners Limited does not currently consider the principal adverse impacts of investment decisions on sustainability factors because the regulatory technical standards supplementing SFDR remain in draft form and their implementation has been delayed. Adelio Partners Limited will keep the decision not to consider the principle adverse impacts on sustainability factors under review and re-evaluate this decision on a periodic basis.
Adelio Partners Limited has a remuneration policy in place that aims to promote sound and effective risk management considering relevant risks, including sustainability risks. Adelio Partners Limited’s staff are paid a combination of fixed remuneration and variable remuneration. Any award of variable remuneration considers the individual’s adherence with internal policies and procedures, including those that relate to the consideration of sustainability risks in the investment decision making process.