Eos Venture Partners ESG Policy
The United Nations Principles for Responsible Investment (the UN Principles) set out certain guiding principles, which are consistent with the fiduciary duties and responsibilities of fund managers to act in the best long-term interest of their institutional investors.
Under these Principles it is considered that certain environmental, social, and corporate governance (ESG) issues can affect the performance of investment portfolios (to varying degrees across companies, sectors, regions, asset classes and through time). There is industry recognition that applying these Principles may better align investors with broader objectives of society.
Eos Venture Partners (Eos) operates an ESG system involving policies, implementation of polices throughout the investment process and ongoing review of portfolio companies’ compliance with the policies.
Our guiding principles are as follows:
- We will incorporate ESG issues into investment analysis and decision-making processes
- We will be active owners and incorporate ESG issues into our ownership policies and practices
- We will seek appropriate disclosure on ESG issues by the entities in which we invest
- We will promote acceptance and implementation of the Principles within the investment industry
- We will work together to enhance our effectiveness in implementing the Principles
- We will each report on our activities and progress towards implementing the Principles
Eos has developed policies in relation to the environment and climate change, governance and social issues.
Environment and climate risk policy
The objective of this policy is to do no harm to the environment with a particular focus on not contributing to climate change and, where possible through portfolio companies, better understanding and monitoring climate risk. The policy is implemented by an assessment of any potential negative environment and/or climate impacts during the investment approval process, and ongoing review of environmental impacts and climate risks during the investment management process.
The objective of this policy is to ensure that Eos invests in companies with sound corporate governance and which are fair and honest in their dealings with others. To this end, Eos will only invest in businesses which exhibit high standards of business integrity and honesty and for which Eos judges corporate governance standards to be adequate.
The objective of this policy is to ensure that Eos treats its employees and contractors fairly and respects their personal dignity, diversity and wellbeing, and to ensure that the companies in which Eos invests do the same.
ESG risks and opportunities are implicitly considered during Eos’ due diligence and the approval process for investments. These are to be included in the IC papers where relevant and material and specifically when considering i) market opportunities and competition; ii) areas of risk/concern and relevant mitigations; and iii) key points of focus post investment.
ESG is also an integral part of Eos’ investment review process. Eos will monitor and review portfolio company compliance with its ESG policies on an ongoing basis and reviews compliance quarterly.
Insurance, InsurTech and ESG
Eos invests exclusively in the Insurance/ InsurTech market, where portfolio companies have the potential to act as enablers for broader ESG priorities:
- Insurance offers protection in the event of natural catastrophes, which increases resilience of the economy, provides a safety net in the event of injury or death and improves health and wellness
- Swiss Re estimate the global protection gap increased to $1.4tn in 2020 (Source: Swiss Re Institutes)
- Environmental risks are growing with more extreme weather events
- The issue is not constrained to emerging markets in the US, 5 out of 6 homes lack flood insurance and many people in the gig economy lack access to affordable cover due to a poor credit rating
- The mortality protection gap is estimated at $114tn globally. In emerging markets, insurance and savings still meet less than 10% of the population’s protection needs (Source: Swiss Re Institutes)
- The emergence of technology allows for real time monitoring and development of risk mitigation, prevention strategies and disaster recovery plans
- Technology also allows insurers to offer affordable, tailored and usage-based coverage and to access new demographics through embedded solutions that were previously very difficult to reach (e.g. leveraging mobile banking infrastructure)
- Improved product design (including parametric solutions) that support an integrated process including efficient claims settlement