Triple Point Venture VCT Venture shares | ESG

An important aspect of Triple Point’s approach to ESG and sustainable business is the adoption of the Principles for Responsible Investment (‘PRI’), which we signed up to in 2019. The PRI principles are designed to guide and demonstrate best practice ESG integration, and to promote alignment between the objectives of investors and wider society. The principles, which are voluntary, are intended to be actionable and measurable.

In support of our commitment to ESG and sustainable business, Triple Point has designed and implemented ESG integration policies across our investment strategies. The purpose of each policy is to identify, monitor and manage ESG issues to minimise the risk of Triple Point investing in ways that could undermine ESG principles. Such investing risks harm to wider stakeholders, undermining, and potentially reducing, the financial objectives of our investments.

Should you wish to see a copy of a Fund’s ESG policy please contact: [email protected]

Our Venture Fund share class investments align with international standards and good industry practice, including monitoring industry regulation (such as the UK Bribery Act, and UK Companies Act) and investor-led initiatives (such as the PRI), as the foundation of our ESG integration approach. Using these foundational principles, we have developed an in-house approach to drawing out maximum value from ESG integration. We place proportionate expectations on the company, according to its sector, size and stage of growth. The careful crafting of our method adds, we believe, a further strength to the Triple Point Venture Fund.

We endeavour to ensure that our funds are not deployed to any business, body or asset linked to the following sectors:

• Adult content;

• Gambling (excluding charitable lotteries*);

• Animal testing;

• Arms trade; and

• Tobacco

* Charitable lotteries funding good causes or raising funds for local charities can create positive social benefits. These are permissible investments but subject to Triple Point’s due diligence on the governance and management capacity of the organisation to ensure appropriate use of funds, including the requirement for some form of basic reporting system on use of funds/impact creation. Once it is confirmed a client/asset is not exposed to any of the restricted sectors, we can proceed with the next steps in our ESG due diligence

Triple Point strives to deliver more than just investment returns, and continually looks to create value for our investors, while delivering wider benefits to people and the planet.

The Ventures Fund looks to maximise shareholder returns by investing in innovative early-stage businesses, typically at the point at which they have achieved early market validation by securing one of their first contracts with an established corporate customer; in particular we seek those businesses that are actively solving problems for established corporates – we call this our challenge-led approach. As part of the  process of understanding the potential of a business we also examine how the company is positioned relative to ESG factors at the point of investment and as the company grows. It is our belief that retrofitting a sustainable business mindset and model, can be time consuming and challenging further down the line. The Ventures team invests for growth and so we take a considered judgement that these issues could come to bear during the investment or at exit, if they are not considered at the point of investment.

Stewardship is an important part of our role as Responsible Investors.

We see Triple Point’s approach to Venture Capital investing and ESG integration as natural allies. Our investments have a 4 to 7 year investment horizon, providing opportunity to takea stewardship-style approach to our company engagement. This creates the ideal platform to exercise ESG integration in our investment decisions, and in the dialogue we have with our companies. We believe a material and proportionate approach to ESG integration for ventures can bring added value to the growth and success trajectory of these companies. Proportionate action is imperative given the small size of the companies we invest in. We have carefully tailored our approach to ESG integration to limit additional burden, and bring greatest value, to the management teams of our investee companies.

We have conducted a careful review of our investment processes to enable the implementation of practical, proportionate and material ESG integration. There are two key elements to our approach:

1. Management (Culture, Capacity & Governance) – this refers to the allocation of appropriate resourcing, training and senior support to ESG integration. It demonstrates Triple Point’s actions have integrity aligned with the strategic position of the company and oversight from senior management. Examples of which include:
   1. Training across our investment team on ESG
   2. Training of our Investment Committee on ESG
   3. Providing greater transparency on our approach to ESG
2. Investment (Process & Reporting) – this refers to action taken in the investment process to assess and improve ESG factors affecting the target asset, how these might affect an investment decision and how we capture decisions and changes to ESG factors during our asset ownership. Examples of which include:
   1. Formal reviews by the team of ESG trends and topics at a micro, macro and sector level to feed into origination process
   2. ESG due diligence process with results included in IC papers
   3. Sharing areas of weakness, with constructive guidance, on how to progress so company awareness on a range of ESG issues develops with ownership