Statement on Principal Adverse Impacts of investment decisions on sustainability factors by SEED Capital
With reference to EU REGULATION (EU) 2019/2088 and 2022/1288 (SUSTAINABLE FINANCE DISCLOSURE REGULATION) (“SFDR”)
- NO CONSIDERATION OF ADVERSE IMPACTS OF INVESTMENT DECISIONS ON SUSTAINABILITY FACTORS
Seed Capital Denmark IV K/S (“SEED IV”) including its management company Seed Capital Management IV I/S (jointly hereinafter referred to as “SEED”) will when making investment decisions consider ethical, environmental, and societal consequences of such investments, as set out in SEED’s Investment Policy.
While SEED does consider sustainability risks in its investment decisions, SEED does not consider all of the specific adverse impact indicators set out in Table 1-3 of Annex 1 of the Commission’s delegated regulation supplementing SFDR. The reason for this is, that SEED’s investment strategy is focused on investments in technology companies at their seed-stage of development and that such impact indicators are not valid for start-up companies to report on, and further that SEED has decided to focus on certain specific sustainability risk indicators that are appropriate fit for the SEED Funds’ investment profile, rather than to consider all of the indicators set out in Table 1-3 of Annex 1.
SEED has a set of ethical guidelines that investments need to comply with and further SEED’s ESG concerns and efforts will play an important part in assessing potential investments. In addition to this, Seed Capital will as part of the investment risk assessment evaluate ethical and ESG risks including the following: Political risks and the risks of future changes in the legislation on the area, environmental aspects, general ethical considerations, and the risk of negative consumer reaction. SEED will observe “The Active Owners Denmark Ethical Guidelines” and the “United Nations Principles for Responsible Investments”.
Further SEED has defined cross-portfolio KPIs related to ESG measures that all portfolio companies in SEED funds III and IV are required to report on, on an annual basis, as part of the financial reporting cycle, including diversity (gender, nationality, ages, pay etc.) across Board, Management and entire Company. This will be reported to Limited partners as vel as SEED is a signatory party to the Diversity Commitment. SEED’s own remuneration policies are structured with no encouragement of any excessive risk-taking with respect to sustainability risks.
Regarding environmental risks, SEED will, by an active ownership, do its utmost to ensure compliance of its portfolio companies with applicable environmental legislation, supporting a precautionary approach to environmental challenges and working towards minimizing the negative social and environmental impact of the businesses of SEED portfolio companies.
SEED will, on a continuous basis assess the above position and review the decision.
- REFERENCE PERIOD
The first reference period will start on 1st January 2022 and will run to 31st December 2022.
This statement has been updated prior to 23 June 2023 and will be updated each year in June, at the latest.