Environment Social Governance

Leading global solutions

We sustain the environment we operate in

Beneficial engagement that preserve the interest of the environment, the community and the government are formed in our corporate strategy policy to ensure sustainable investments.


RSF holdings have an unwavering commitment to responsible investment and sustainability has been embedded throughout the investment process for well over a decade. This commitment has been formed by the conviction that a responsible investment strategy not only supports maximised economic returns for investors but can also deliver a net benefit for society and the environment.

We are signatories to the UN’s Principles for Responsible Investment (PRI) since 2011 and have received an A+ rating in both the Strategy and Governance Module and the Direct Private Equity Module for the past four years. Published annually since 2012, the Sustainability Report highlights the wide-ranging Environmental, Social, and Governance (ESG) initiatives undertaken at RSF holdings and the RSF holdings Funds’ portfolio companies.




Environmental Highlights

The RSF holdings Buyout Funds’ portfolio can be qualified as ‘asset light’ and the most material environmental indicator for many companies is electricity usage. Several early movers among the portfolio companies are developing detailed climate strategies by setting Carbon Neutral targets (e.g. Wehkamp and TietoEvry) or committing to Science-based targets (e.g. Thoughtworks). There are also several initiatives underway to reduce complexity, waste and natural resource consumption,, focusing on waste reduction, reuse and recycling in particular.

Social Highlights

The RSF holdings Funds’ portfolio companies employ almost 1,000+ people (both indirectly) and with this comes a responsibility to ensure that processes and practices are in place across the portfolio to support the well being of the workforce. Through collecting multiple indicators on the employee base and its wellbeing, RSF holdings is able to highlight key best practices and also areas where more focus is required. One of these topics is the inclusion and diversity profile of the RSF holdings portfolio companies.

Governance Highlights

RSF holdings believes that good corporate governance is the foundation of effective corporate management. Virtually all companies have a code of conduct and/or a code of ethics which guides their business activities. Portfolio companies that are new or which have historically had less focus on governance are actively encouraged to adopt appropriate codes and processes within the first year of investment.








Investment processes and strategies

We reflect the above beliefs about ESG by integrating ESG considerations broadly across our investment strategies as well as by offering dedicated equity and fixed income strategies that seek to accomplish specific ESG-related outcomes

  • ESG Integration
  • Active Ownership
  • Targeted ESG strategies

Environment

Our Buyout Funds’ portfolio can be qualified as ‘asset light’ and the most material environmental indicator for many companies is electricity usage.

Social

processes and practices are in place across the portfolio to support the wellbeing of the workforce.

Governance

good corporate governance and a code of ethics which guides our business activities is the foundation of effective corporate management.






Our investment processes integrate ESG considerations for risk management purposes. We start by designing our portfolios using the following investment principles:
  • target drivers of return supported by robust research;
  • diversify across issuers, sectors and countries where applicable;
  • consider information on prices every day; and
  • systematically implement portfolios by thoughtfully balancing expected returns, costs and risks.

While the above approach uses diversification to reduce idiosyncratic risks, including ESG-related risks, we also apply an additional layer of ESG-specific risk management. For instance, we may exclude closely-held companies from our universe of eligible securities, since companies with large strategic shareholders may not represent the interests of a broad set of shareholders. We may also choose not to purchase companies where, based on public information, we believe there is a heightened concern of fraudulent or other behavior or situations that may make company financial statements no longer reliable. We also conduct daily news checks to identify portfolio companies involved with controversies, including with respect to environmental or social issues, that may have a significant impact on company financials. These companies may be placed on temporary halt from further purchases and/or referred to our Stewardship team for engagement. We believe these additional processes provide another element of risk management that incorporates ESG considerations.




Active Ownership

Our role as investment advisors for clients does not end once we invest in a security. Rather, our Investment Stewardship team advocates for best-in-class governance practices, including oversight of material ESG-related risks, as we believe that improved governance practices may result in higher realized returns through higher future cash flows to shareholders or a lower discount rate applied by the market. Our stewardship efforts include engagement, proxy voting, and participation in industry events and organizations. See our Investment Stewardship Statement and Annual Stewardship Report for more information on our active ownership activities.

Targeted ESG strategies

We offer targeted sustainability and social strategies that use ESG integration and also add a greater level of focus on ESG criteria by pursuing specific ESG outcomes. These strategies use innovative processes to incorporate ESG considerations into broadly diversified, value-added systematic investment solutions. This is demonstrated by our track record managing sustainable and socially-screened strategies, now covering over a decade since the launch of our first socially-screened strategy in 2009.






Environmental, Social and Governance Objectives

Firm Level
Investment Level

Environmental Objectives

Increase the use of employee alternative transportation and decrease our scope 3 emissions:
  • Providing employees a monthly subsidy on commuting passes for public transportation
  • Publicize links of local transit opportunities
Reduce or eliminate the production of waste:
  • Installing water dispensers and providing all employees with reusable water bottles
  • Removing plastic water bottles from the office
  • Limiting single serve paper or plastic cups
Reduce or eliminate the use of paper products by:
  • Promoting recycling
  • Printing double-sided reports and presentations
  • Minimizing printed materials by focusing on using electronic copies of reports and presentations

Social Objectives

Encourage employee involvement and open communication through the deployment of our annual employee survey, regular trainings (including ESG topics), career development programs, and annual employee performance reviews
Facilitate better employee health and well-being through improved indoor air quality, adding handicap accessibility, and by promoting additional health and wellness strategies at our offices
Foster community engagement at RSF through the development and support of charitable programs by:
  • Implementing casual dress Fridays for employees who donate $10 each month
  • Encouraging employees to submit charity events for firm sponsorship and to attend charity events including:
    • School on Wheels Massachusetts Outrunning Homelessness
    • Corey C. Griffin Charitable Foundation
    • FamilyAid Boston
    • United Way of Massachusetts Bay and Merrimack Valley
    • National Brain Tumor Society
Collaborate with our joint venture partners on implementing, tracking, and reporting our ESG initiatives
Facilitate diversity education, training, communication, and collaboration to utilize the full potential of each employee
  • Partnered with ThinkHR to conduct anti-harassment training for all employees
  • Offer online diversity education and training for employees
Address the information needs of our key stakeholders and communicate with them on information including environmental, social, and corporate governance issues
Promote diversity and inclusion at our company by continuing to be an equal opportunity employer
  • Partnered with OppNet’s Opportunity Ignited Corporate Solutions and formed a summer internship program to hire from their diverse internship candidate pool to increase and develop the awareness of BIPOC talent at RSF
  • Founding Sponsor of the PREA Foundation and active member of AFIRE and ULI, all organizations focused on increasing diversity and inclusion in the institutional real estate industry

Governance Objectives

Regularly convene with our ESG Taskforce to discuss the goals, strategy, and management of our ESG Program
Align our program with sustainability reporting frameworks such as GRESB to improve overall ESG performance and increase transparency
Continue to participate in industry organizations and associations designed to facilitate communication, transparency, and the sharing of knowledge, consistent with ILPA reporting guidelines
Distribute quarterly and annual reports to Limited Partners and include ESG updates
Hold annual investor meetings for all active funds (including Advisory Board meetings) to ensure transparent communication
Seek to use governance structures that provide appropriate levels of oversight in the areas of audit, risk management, and potential conflicts of interest
Continue to exceed or comply with all national, state, and local labor laws and regulation standards



Environmental, Social and Governance Practices

We believe the transformative power of technology is the key to an even better future
– a smarter economy, a healthier planet, diverse and inclusive communities,
and a broader path to prosperity.




Our Commitment to Stakeholders

We recognize the opportunity and responsibility we have to make a positive impact on the world through our business and investment decisions. Our environmental, social and governance (ESG) policy reflects our commitment to creating value for all of our stakeholders and adhering to the highest standards of integrity throughout the lifecycle of each investment.

ESG Policy

RSF is committed to ESG management in our private equity portfolio. We’ve aligned our ESG policy with the American Investment Council’s comprehensive Guidelines for Responsible Investing . We regularly revisit and update our ESG Policy to ensure that it evolves with changes in industry demands and regulations.



Guiding Principles

  • Wellness and Safety: Ensure proper labor and working conditions to safeguard the health and safety of RSF employees and employees at RSF portfolio companies.
  • Inclusivity: Encourage a culture of meritocracy, fairness and transparency.
  • Trust and Responsibility: Promote honesty, integrity, fairness and respect in all of our business practices.
  • Privacy and Cybersecurity: Protect the privacy of confidential consumer and corporate information through our own operations and those of RSF portfolio companies.
  • Transparency: Provide stakeholders with clear, transparent information regarding ESG risks
  • Protecting Our Planet: Ensure and continuously improve the environmental responsibility and energy efficiency of our firm and our portfolio companies.
  • Social and Community Empowerment: Promote the development of our communities and use our position as a community leader to provide charitable contributions, with a focus on job training and opportunity, access to education, supporting the arts and culture, and protecting our health and environment.

Broad Accountability

At RSF, we foster ESG understanding and accountability throughout the firm. Our investment professionals are responsible for managing and instilling the guiding principles of our ESG policy across our portfolio companies. In addition, RSF Consulting Group (RCG) is actively involved in addressing potential ESG risks during the private equity investment process and within the RSF firm. Our Compliance team provides oversight and ensures that employees at RSF adhere to our ESG policy.

Responsibility: From Sourcing to Exit

We incorporate ESG analysis into our private equity investment process to limit stakeholder risks and position our portfolio companies for sustainable growth and success. Before every deal and add-on acquisition, RCG subject matter experts conduct an in-depth review of the company’s technology, cybersecurity and data privacy practices. Additionally, we engage law firms and consulting firms to assess potential ESG risks and opportunities. All material findings are communicated to the investment committee.

After a deal has closed, RSF continues to monitor ESG performance and progress throughout the life of each private equity investment. We ensure ESG measures are maintained through regular conversations and documented check-ins with RSF portfolio company management and leadership, as well as board oversight during quarterly meetings.

Our Commitment to Investors

We advance the market impact of RSF portfolio companies while safeguarding stakeholder interests.




WELLNESS AND SAFETY
Ensure proper labor and working conditions to safeguard the health and safety of RSF employees and employees at RSF portfolio companies.

INCLUSIVITY
Encourage a culture of meritocracy, fairness and transparency.

TRUST AND RESPONSIBILITY
Promote honesty, integrity, fairness and respect in all of our business practices.

PRIVACY AND CYBERSECURITY
Protect the privacy of confidential consumer and corporate information through our own operations and those of RSF portfolio companies.
TRANSPARENCY
Provide stakeholders with clear, transparent information regarding ESG risks.

PROTECTING OUR PLANET
Ensure and continuously improve the environmental responsibility and energy efficiency of our firm and our portfolio companies.

SOCIAL AND COMMUNITY EMPOWERMENT
Promote the development of our communities and use our position as a community leader to provide charitable contributions, with a focus on job training and opportunity, access to education, supporting the arts and culture, and protecting our health and environment.


Principles for Responsible Investment

RSF is a signatory of the United Nations-supported Principles for Responsible Investment (PRI), the world's largest reporting project on responsible investment. Through priority areas, PRI's blueprint for responsible investing prioritizes some of the most pressing ESG issues in the world today - from climate change to the barriers around a more sustainable financial system - leading to prosperous and inclusive societies for future generations.



Serving a Broader Purpose

By prioritizing ESG practices and policies, our unmatched experience investing in the enterprise software market enables us to consistently deliver on our commitments to investors who have entrusted us with their futures.
ESG OVERVIEW

ENVIRONMENTAL PRACTICES
Driving positive change throughout our global economy.

SOCIAL ENGAGEMENT
Creating equitable opportunities that strengthen our shared workforce.

GOVERNANCE STRATEGY
Delivering a modern structure for responsible leadership at scale.
We operate long-term assets and businesses across the globe. This approach dictates both our investment strategy and our commitment to environmental, social and governance (ESG) practices. We believe that value creation and sustainable development are complementary goals. Throughout our operations, we are committed to practices that have a positive impact on the communities in which we operate.


Our ESG principles are embedded throughout our operations and help us ensure that our business model will be sustainable well into the future.


Mitigate the impact of our operations on the environment:

  • Strive to minimize the environmental impact of our operations and improve our efficient use of resources over time.
  • Support the goal of net zero greenhouse gas (GHG) emissions by 2050 or sooner.

Mitigate the impact of our operations on the environment:

  • Strive to minimize the environmental impact of our operations and improve our efficient use of resources over time.
  • Support the goal of net zero greenhouse gas (GHG) emissions by 2050 or sooner.

Ensure the well-being and safety of employees:

  • Foster a positive work environment based on respect for human rights, valuing diversity, and zero tolerance for workplace discrimination, violence or harassment.
  • Operate with leading health and safety practices to support the goal of zero serious safety incidents.

Ensure the well-being and safety of employees:

  • Foster a positive work environment based on respect for human rights, valuing diversity, and zero tolerance for workplace discrimination, violence or harassment.
  • Operate with leading health and safety practices to support the goal of zero serious safety incidents.

Uphold strong governance practices:

  • Operate to the highest ethical standards by conducting business activities in accordance with our Code of Business Conduct and Ethics.
  • SMaintain strong stakeholder relationships through transparency and active engagement.

Uphold strong governance practices:

  • Operate to the highest ethical standards by conducting business activities in accordance with our Code of Business Conduct and Ethics.
  • SMaintain strong stakeholder relationships through transparency and active engagement.

Be good corporate citizens:

  • Ensure the interests, safety and well-being of the communities in which we operate are integrated into our business decisions.
  • Support philanthropy and volunteerism by our employees.

Be good corporate citizens:

  • Ensure the interests, safety and well-being of the communities in which we operate are integrated into our business decisions.
  • Support philanthropy and volunteerism by our employees.

RSF's Net Zero Commitment

W e support the goal of net zero greenhouse gas (‘GHG’) emissions by 2050.
Over the past 13 years, RSF has built one of the largest private renewable power businesses in the world. With installed renewable generating capacity of 20 GW, we now produce more than enough green energy to power London and will more than double that amount once our development portfolio is brought online.
We recognize that further renewable power capacity must be rapidly scaled to replace fossil fuel generation and meet expanding global electricity demand so that the world can eliminate the over 70% of global emissions that come from final energy consumption as quickly as possible.


RSF intends to build on this leading position in renewable power and do much more to contribute to the transition to net zero

We will go further

In addition to continuing to make major investments in renewable energy globally, we will manage our investments to be consistent with the transition to a net zero economy. As a recent signatory to the Net Zero Asset Managers initiative, we have made a commitment to investing aligned with net zero emissions by 2050 and implementation of science based approaches and standardized methodologies through which to deliver these commitments.

We will help accelerate the transition to Net Zero

We will catalyze companies onto Paris-aligned net zero pathways through our new Global Transition investment strategy, focusing specifically on investments that will accelerate the transition to a net zero carbon economy.

We will collaborate

We will work with leading private sector initiatives to advance the role of finance in supporting the economy-wide transition, to accelerate capital flows consistent with the Paris Agreement, and to promote widespread adoption of decision-useful methodologies to support credible transition planning, analysis and investing.

We will continue to pursue industry-leading returns for our investors, consistent with our long track record of building the backbone of a more sustainable global economy.

We will continue to pursue industry-leading returns

We will track and report GHG emissions consistent with GHG Protocol and PCAF standards. We will publish decarbonization plans every five years consistent with the Paris Agreement.

We are committed to transparency

We continue to align our business with the TCFD recommendations and are targeting to incorporate TCFD disclosures for the 2022 fiscal year.

Alignment
Net Zero Asset Managers Initiative

ESG Frameworks and Memberships

RSF is a signatory to the Net Zero Asset Managers initiative, underscoring our long-standing commitment to driving the complementary goals of sustainability and value creation across our investments and operations. The Net Zero Asset Managers initiative is a group of international asset managers committed to supporting the goal of net zero greenhouse gas emissions by 2050 or sooner, in line with global efforts to limit warming to 1.5 degrees Celsius; and to supporting investing aligned with net zero emissions by 2050 or sooner.

RSF is a signatory of the Principles for Responsible Investment (PRI), formally demonstrating our ongoing commitment to responsible investment and environmental, social and governance (ESG) best practices. The PRI is one the world’s leading proponents of responsible investing, with an emphasis on understanding the investment implications of ESG factors and supporting an international network of investor signatories in incorporating these factors into their investment and ownership decisions.

The Sustainability Accounting Standards Board (SASB) connects businesses and investors on the financial impacts of sustainability. SASB Standards enable businesses to identify, manage, and communicate financially material sustainability information to investors. SASB Standards are industry-specific and are designed to be decision-useful for investors. They are developed using a process that is evidence based and market informed.

The Prince’s Accounting for Sustainability Project (A4S) was established by HRH The Prince of Wales in 2004 to mobilize action and leadership by the finance and accounting community to address the challenges to the economy and society posed by issues such as climate change, increasing depletion of and demand for natural resources, urbanization and inequality. A4S seeks to inspire action by finance leaders to drive a fundamental shift towards resilient business models and a sustainable economy.

A global nonprofit organization, BSR works with its network of more than 250 member companies and other partners to build a just and sustainable world. From its offices in Asia, Europe, and North America, the nonprofit develops sustainable business strategies and solutions through consulting, research, and cross-sector collaboration.

Integrating ESG considerations into our investment process

Our PRI commitments include incorporating ESG factors into our investment decisions, starting with the due diligence of potential investments through to the exit process. We tailor ESG due diligence to each investment, and we create post-investment remediation plans for material ESG considerations. For all potential investments, we use internal experts and a variety of ESG frameworks to identify material ESG factors and utilize external consultants where appropriate. This analysis includes everything from ensuring environmental, legal and regulatory compliance to the identification of opportunities to add value or mitigate risk in our portfolio. Our investment teams use an ESG due diligence guideline to ensure consideration of material ESG risks and opportunities. These teams then provide a detailed memorandum to the Investment Committee outlining the merits of the transaction and disclosures relating to risks, including material ESG issues, and potential mitigation strategies. All investments made by RSF must be approved by the Investment Committee and must incorporate ESG matters into their evaluation, including anti-bribery and corruption, health and safety, and other ESG considerations.

Upon company acquisition, we create a tailored integration plan to ensure that all material matters, including ESG risks and opportunities are prioritized. ESG risks and opportunities are actively managed by the portfolio companies with guidance from our in-house investment teams, primarily through representation on company boards and equivalent oversight bodies where all financial, operational, and strategic elements of the business are reported, considered, and where appropriate, approved. This allows us to draw on local expertise, which provides valuable insight given the wide range of asset types and locations in which we invest. Certain key performance indicators, such as serious safety incidents, are reported regularly to the applicable board or other oversight body.



A strong governance framework

We are always working to maintain sound governance practices to ensure ongoing investor confidence. This involves a continual review of how evolving legislation, guidelines and best practices should be reflected in our approach. For example, we have a zero-tolerance approach to bribery, including facilitation payments, and all RSF employees are mandated to complete an in-depth anti-bribery and corruption (ABC) training seminar annually. RSF maintains an ethics hotline to report suspected unethical, illegal or unsafe behavior. The reporting website can be accessed through this link. Our reporting hotline is managed by an independent third party and is available 24 hours a day, 7 days a week. We also require all portfolio companies in which we have a controlling interest to adopt an ABC policy that is equally stringent to RSF’s, which entails that portfolio companies install an ethics hotline within six months of acquisition.

Health and safety in our portfolio companies

Employee health and safety is a top priority at RSF. We view health and safety as an integral part of the management of our business and therefore consider it a line responsibility best managed by portfolio companies. We have established a safety steering committee, which includes the CEOs and COOs of each business group, to promote common values and a strong health and safety culture, share best practices and monitor serious safety incidents.

Fostering diversity & inclusion

Embedded in our culture is a commitment to advancing diversity and inclusion across our organization. This begins at recruitment, continues in leadership training programs and is woven into our policies and procedures. As a global firm, we know that the best ideas come from having people from different backgrounds, perspectives, experiences and skills across all businesses, levels of seniority and offices.

Traning and Man power development

Training programs set clear expectations for our leaders in terms of their role in helping all team members achieve their potential. The training emphasizes building trust with their teams, becoming aware of unconscious biases and provides guidance on how to add rigor to decision-making especially in recruiting, performance feedback and promotion, with the goal of creating a more diverse and inclusive environment.

Women make up

46%
of total employees
55%
of independent board directors
30%
of vice presidents and above

A commitment to green buildings

Developing properties that take environmental considerations into account is not only a passion, it provides returns on our investments. That’s why 100% of our new developments are being built according to LEED® Gold standards, to proactively address greenhouse gas emissions, energy efficiency, water use, indoor air quality, and other impacts.

$17B

Aggregate value of our green financings in Renewable Power, Real Estate, Infrastructure and Private Equity

Sustainable finance

RSF strives to be a leader in sustainable finance products, which support adaptation to global climate change challenges.



Community engagement and philanthropy

We recognize that activities that support growth and development include involvement in interests outside of day-to-day employment activities. We view our philanthropic activities as an opportunity to engage our people, support their development and be of benefit to the local communities in which we operate.

Our two-pronged global approach includes a global matching program that provides each employee the ability to donate to a not-for-profit of their choice and receive a match from the Firm as well as a capital pool for each office to support philanthropic activities that are important to our people and facilitate relationship building in support of collaboration.




Mitigate risks. Improve returns

Putting ESG thinking at the heart of your investment process
Designed to help you make sound, sustainable investment decisions, our ESG investing information covers 80% of global market cap and 76 countries over 450 metrics.
It helps you assess the risks – and opportunities – posed by companies’ performance in critical areas such as climate change, executive remuneration, and diversity and inclusion.
You can carry out your ESG research with complete confidence because every data point is rigorously quality controlled and verified to ensure that it is standardized, comparable and reliable.
Our Fund ESG Scores provide you with independent fund level scores highlighting the sustainability of particular investment funds.
As well as ESG data and scores, we offer sustainable bond information to help assess sustainable Fixed Income strategies and investments
Firms can use our ESG Contributor Tool to upload ESG data to the Refinitiv ESG database to ensure thousands of investors are able to retrieve the full view of a company












Our approach to ESG data

With our standardized ESG data points (450+) and analytics (70+) – for nearly 80% of global market cap based on publicly reported company data and 210 countries – we strive to be the industry standard database that reflects official company disclosure on environmental, social, and governance (ESG) metrics.
We believe that company disclosure and standards of reporting on these issues is critical for driving accurate investor information, public discourse, regulatory guidance.
We also believe that transparency is critical to driving positive outcomes at both a financial and social level.
To this end – for the purposes of company scoring – we do not use, create, or collect data that is not disclosed or publicly available.



As such, we can create a complete line of auditability all the way from documents (such as annual reports), to the company data points in our database, to company scores, to fund ratings which are based on robust fund holdings data.