DISCLOSURES PURSUANT TO THE SUSTAINABLE FINANCE DISCLOSURE REGULATION (EU) 2019/2088
From 10th March 2021, a new regulation on sustainability-related disclosures in the financial services sector applies to all EU market participants, including venture capital funds. wiwi Fondsmanagement GmbH is a Capital Management Company within the meaning of the German Capital Investment Code. It publishes the following information on its website in accordance with Regulation (EU) 2019/2088 on sustainability-related disclosure requirements in the financial services sector. Unless information is explicitly provided in relation to a specific fund managed by wiwi Fondsmanagement GmbH, the following statements refer to wiwi Fondsmanagement GmbH’s management and investment decision-making processes in general.
Wiwi Fondsmanagement GmbH focuses on the most promising European climate tech startups in the fields of Energy, Mobility and Nature & Carbon Tech.
Wiwi Fondsmanagement GmbH’s investment decisions reflect environmental, social, and governance (ESG) considerations, and the evaluation of ESG related risks and opportunities is an integral part of the investment strategy.
PRODUCT SPECIFIC DISCLOSURE: CLIMATE FUND
Wi Venture Climate Fund GmbH & Co. KG (the “Fund” or “Wi Venture Climate Fund”) is managed by wiwi Fondsmanagement GmbH. The Fund pursues a venture capital strategy and focuses on investments in transformative technologies which have the potential to fundamentally change value chains in today’s major industry verticals. The Fund promotes environmental or social characteristics but does not have as its objective a sustainable investment. As such, the kopa ventures Climate Fund qualifies as Article 8 product.
The integration of ESG criteria in investment decision-making and management is an integral part of the Fund’s strategy. Additionally, wiwi Fondsmanagement GmbH has developed an in-house assessment framework enabling to monitor and manage the attainment of the environmental or social characteristics of the Fund. Notably, the Theory of Change functions as a thorough evaluation structure and a strategic administration instrument, utilizing sustainability metrics. This allows companies in the portfolio to actively contribute to the United Nations Sustainable Development Goals (SDGs).
No sustainable investment objective
The Fund promotes environmental characteristics but does not have as its objective a sustainable investment. As such, Wi Venture Climate Fund qualifies as Article 8 product.
Environmental or social characteristics of the Fund
Wiwi Fondsmanagement GmbH is convinced, that the active management of ESG related issues has an impact on the financial performance of our portfolio and helps us grow profitable and sustainable businesses practices. As such, the wiwi Fondsmanagement GmbH continuously monitors the environmental characteristics of the Fund.
Wi Venture Climate Fund pursues a venture capital strategy and focuses on investments in startups that develop transformative technologies to fundamentally change value chains in today’s major industry verticals. Investees are predominantly startups that have a measurable positive environmental impact while building a scalable profitable business. This includes among other companies that address climate change, resource efficiency, the adoption and utilization of low-emission energy sources, regenerative agriculture and more.
Details on the performance of the Fund on environmental and social characteristics are published in the annual wiwi Fondsmanagement GmbH Sustainability Report on the website.
In addition to generating superior financial returns for our investors, Wi Venture Climate Fund focuses on investments generating positive environmental impact. We diligently work to ensure that our portfolio companies not only minimize their environmental impact but also contribute positively to the natural world. We are focused on European investments in energy, mobility, carbon and nature tech solutions.
The evaluation of ESG related risks and opportunities is an integral part of our investment strategy. The Fund’s risk management processes consider such sustainability risks by way of identifying, mitigating, or offsetting risks early and effectively. This includes the consideration of potential adverse effects of investment decisions.
For that purpose, ESG practices are assessed and managed in the due diligence phase and on a yearly basis. The results and findings are examined with the investment managers, who can bring ESG risks and opportunities to the attention of the board of the respective company.
The investment and management process of the Fund’s ecological investment objectives are guided by the following principles:
Wiwi Fondsmanagement GmbH incorporates ESG considerations into the investment and decision-making process as well as into exit and post-investment considerations.
Wiwi Fondsmanagement GmbH proactively drives the incorporation of ESG matters in the management practices of the portfolio companies.
Wiwi Fondsmanagement GmbH is dedicated to continuously improve the implementation of ESG principles within the portfolio companies.
Wiwi Fondsmanagement GmbH continuously improves the transparency and monitoring of ESG issues in portfolio companies.
Furthermore, we use the Theory of Change as strategic tool to develop and pursue defined sustainability KPIs. Read more about the Theory of Change.
The Fund does not invest, guarantee, or otherwise provide financial or other support, directly or indirectly, to companies, including portfolio companies, or other entities whose business activity consists of:
>Alcohol and tobacco
> Genetically Modified Organisms (GMO) or human cloning
Proportion of investments
The Wi Venture Climate Fund invests in line with its investment strategy as described above. For all investments of the Fund an ESG assessment is performed annually. 1 out 1 investment of the Fund have the potential to make a significant positive environmental impact globally. All future investments will adhere to the minimum environmental and social safeguards and will be supervised and administered following the outlined ESG (Environmental, Social, and Governance) approach.
Monitoring of environmental or social characteristics
wiwi Fondsmanagement GmbH constantly monitors the environmental characteristics and performance of the Fund. For that purpose, our portfolio companies are required to report on ESG once per year. Monitoring and reporting models are regularly updated in consultation with the portfolio companies to reflect changes in the startup’s processes or products.
The ESG reporting of each portfolio company is assessed by the wiwi Fondsmanagement GmbH team. The results and findings are examined with the investment managers, who can bring ESG risks and opportunities to the attention of the Board of the respective company.
Besides the ESG methodology described above, the wiwi Fondsmanagement GmbH has developed an in-house assessment framework which has its roots in the Theory of Change approach. It serves both as a due diligence framework as well as a strategic tool, which enables our companies to develop their products towards the SDGs (UN Sustainable Development Goals). Thus, we implement Theory of Change framework as a strategic steering tool within our portfolio companies, delivering long-term and measurable impact.
Data sources and processing
Portfolio companies are required to report on ESG and once per year. For some companies, the reported data is based on assessments conducted by third parties, e.g., life cycle analysis.
For the reporting, each portfolio company has a dedicated set of KPIs that are most relevant for its respective business operations. These KPIs have been developed in accordance with the GRI G4 Sustainability Reporting Guidelines, the ICGN Global Corporate Governance Principles, the EFFAS ESG Guidelines, as well as the IRIS metrics.
The Fund gathers the data on sustainability performance from its investments and reports it accumulated to its investors on an annual basis. The Fund’s sustainability performance is furthermore communicated to the public in wiwi Fondsmanagement GmbH’s annual Sustainability Report which can be accessed on the website.
Limitations to methodologies and data
While the current ESG methodology allows to identify an order of magnitude for impact potential, the general validity of projections far into the future is low. Given the nascent nature of startups and the technologies they develop, the data that can be measured and provided by the startups is limited, and partially based on assumptions and average calculations. Therefore, the actual impact will never be uniquely identifiable and correctly predictable.
The integration of environmental, social, and governance (ESG) criteria in investment decision-making and management is an integral part of the Fund’s strategy. Additionally, wiwi Fondsmanagement GmbH has developed an in-house assessment framework enabling to monitor and manage the attainment of the environmental characteristics of the Fund which has its roots in the Theory of Change approach. The framework also accounts for the Sustainable Development Goals (SDGs).
Prior to each investment, ESG risks and opportunities are evaluated in an in-depth due diligence process, leading to an ESG risk profile where ESG risks as well as principal adverse sustainability impacts are valued independently, and a risk mitigation strategy is developed.
wiwi Fondsmanagement GmbH requires from its portfolio companies to report once per year on ESG related issues via an annual questionnaire. In addition, the wiwi Fondsmanagement GmbH team undertakes multiple in-teractions per year with regard to ESG with its investees via e-mail, letter, phone call, meetings, or Board of Directors and shareholder meetings with a view to support the sustainable development of the company. Particular-ly if represented on the Board of Directors of the portfolio company, the team strives to actively provide value-adding input.
In its free discretion, wiwi Fondsmanagement GmbH may decide to make an investment even if risks of potential adverse impacts have been deter-mined. In such case, wiwi Fondsmanagement GmbH may apply appropri-ate mitigation measures including but not limited to offering training for portfolio companies to support their capacity to control, mitigate, and/or reduce such adverse impacts.
Designated reference benchmark
The Fund does not use any reference benchmark.