At Polestar Capital making impact is as important as making financial returns for our investors. To secure the needed resources and focus for our impact and sustainability ambitions we have incorporated impact as a central theme in our corporate and fund policies.
Our Polestar Capital Sustainability Policy describes our vision and strategy on sustainability issues and its integration into our investment processes and procedures. Additionally our Polestar Capital Risk Management Policy describes how we identify sustainability risks, analyze the mitigation measures taken, and monitor these risks and measures. Both policies are approved and monitored by the Polestar Capital’s Executive Board.
Sustainability risks (SFDR Article 3)
In these policies it is secured that Polestar Capital (also) monitors sustainability risks its investments may be exposed to. Sustainability risks are identified as an environmental, social or governance event or condition that, if it were to occur, would cause a real or potential material adverse effect on the value of the investment. In line with Polestar’s Capital Risk Management Policy, the description, measure(s) taken and the monitoring of the risk are recorded when a sustainability risk is identified.
Next to monitoring these risks during the duration of the investment, Polestar Capital has integrated sustainability risks into its investment decision-making process. Before investing or financing of projects and companies our investment team does its due diligence and checks if the project at hand is exposed to certain sustainability risks.
Amongst others Polestar Capital checks and monitors if projects or portfolio companies:
- are located a climate sensitive areas more exposed to extreme heat or flooding
- have measures in place for a safe working environment
- are active in sectors with a higher risk of issues in regards to governance and fraud issues.
Consideration of principal adverse impacts (SFDR Article 4)
Currently, Polestar Capital is unable to fulfil the stringent SFDR requirements regarding the comprehensive and consistent availability of every principle adverse impact (PAI) indicator. As most of Polestar Capital’s investments currently choose not to publicly disclose the data of the PAI indicators and are not obliged to do so, Polestar
Capital is unable to meet the given requirements. Therefore Polestar Capital does not consider the principal adverse impact on sustainability factors on an entity level (Article 4). Polestar Capital remains to have the ambition to report on PAI’s conform SFDR and will follow closely market practices, and future regulatory changes and discuss the required disclosed information with its investees to assess the feasibility of meeting the SFDR
requirements and thus changing its current statement. On a product level, Polestar Capital may decide for each individual fund to consider principal adverse impacts.
Polestar Capital Remuneration policy and integration of sustainability risks (SFDR Article 5)
Polestar Capital’s remuneration policy is consistent with and will further sound and effective risk management with a long-term focus, including sustainability risks. The remuneration policy does not induce any risk-taking that would exceed the risk level tolerated by Polestar Capital. The impact of the remuneration policy may be relevant
to Polestar Capital, seen from an ESG point of view. Concerning variable remuneration, Polestar Capital has the opinion and policy not to provide any variable salaries to its employees. We believe that financial incentives do not trigger the most effective outcome in realizing our investment targets in general or ESG/impact targets specifically.