Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate change
• Economic development, talent & diversity
• Customer & stakeholder relations
• Governance & business ethics

Environmental Achievements

• 1,846 tons of CO2 equivalent (tCO2e) in 2019 – scopes 1, 2 & 3 (upstream) – offsetting residual emissions through the Borneo-based Katingan Forest conservation programme
• GreenYellow’s renewable energy and energy efficiency projects prevented the emission of 200,000 tCO2e

Social Achievements

• 57 net jobs created in 2019 at Tikehau Capital and its subsidiaries
• 44% of permanent workforce women
• Support for 10+ projects and charities

Governance Achievements

• Updated Code of Business Ethics in 2019
• Launching a mandatory training programme focused on preventing corruption and influence peddling in 2020
• ESG integration into investment decisions across all business lines

Climate Goals & Targets

Environmental Challenges

• Climate-related risks (physical and transition risks) across various portfolio companies
• Need to further integrate impact measurement into investment strategies

Mitigation Strategies

• Pilot climate-risk assessment for NOVO 2018 corporate lending fund
• Developing an impact and thematic investment platform focused on climate change, social inclusion, innovation, and healthcare
• Updating responsible investment policy to include impact & climate considerations
• Reinforcing impact measurement tools

Supply Chain Management

Responsible Procurement

• Group Responsible Purchasing Charter

Climate-Related Risks & Opportunities

Physical Risks

• Sea level rise and floods
• Stricter energy efficiency standards for buildings
• Potential energy price increases
• Water stress
• Wildfire
• Heatwaves

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Energy efficiency investments
• Renewable energy investments
• Low-carbon mobility investments

Reporting Standards

Frameworks Used: GRI, SASB, TCFD

Certifications: LuxFLAG ESG label

UN Sustainable Development Goals

• Goal 7
• Goal 12
• Goal 13

Investments in renewable energy, energy efficiency, sustainable cities, and healthcare

Awards & Recognition

• Sofidy named Best Asset Manager for the 17th consecutive year

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Launched a Private Equity fund dedicated to the energy transition, T2 Energy Transition Fund, in partnership with Total SA.
• Launched an impact lending fund, aiming to offer more favourable credit terms to companies based on their ESG performance.

Social Achievements

• Share of women in the workforce 41%
• Launched a fund offering a bespoke, multi-asset solution aimed at providing high net worth individuals seeking diversified exposure to European private markets.

Governance Achievements

• Supervisory Board 50% composed of independent members.
• ESG Committee with nine members, mostly senior and coming from various business lines and countries.

Climate Goals & Targets

Environmental Challenges

• Covid-19 pandemic impacting economies, financial markets, and supply chains.
• Increased regulatory requirements and uncertainties.
• Competition in the alternative asset management market.

Mitigation Strategies

• Implemented measures to minimize the consequences of the Covid-19 pandemic on day-to-day activities and operating systems.
• Strengthened the formalisation of its approach to sustainability risks.
• Continued to invest its funds' capital by maintaining a disciplined and selective investment policy.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: UN PRI

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)

Investments in clean energy production, low-carbon mobility, and improved energy efficiency contribute to these goals.

Awards & Recognition

• Private Equity Provider of the Year, alternatives by Private Equity Wire 2020
• Private Debt Lender of the Year
• Best European Private Debt provider
• Best Debt Provider of the Year – Alternative
• Private Debt Lender, Large Category
• Private Debt Award from AIFI
• Lender of the Year Europe by Private Debt Investors (PDI)
• Best Newcomer with the Tikehau Private Debt Secondaries strategy by PDI
• Best Debt Strategies
• Excellence in ESG 2020 by the British Private Equity & Venture Capital Association
• Lender of the Year, Europe by Private Debt Investor Awards 2020
• Global Newcomer for the private debt secondary team by Private Debt Investor Awards 2020

Environmental Metrics

ESG Focus Areas

• Climate & Biodiversity
• Innovation, Digitalisation & Cybersecurity
• Economic Development & Social Inclusion
• Health

Environmental Achievements

• >250 ktCO2e in emissions avoided by portfolio companies in 2021
• Energy saved in 2021 >130 GWh
• Installed (excl. >11 GW pipeline) Electric powertrains produced in 2021 >1.5 GW
• 1.6m low carbon mobility enablers

Social Achievements

• Launched Belgian Recovery private debt fund to strengthen the solvency of Belgian companies
• Launched “Obligations Relance” Investment Fund to strengthen the financial position of French SMEs
• Launched Impact Lending Strategy with ESG ratchets for SMEs and midcaps
• Supported various philanthropic initiatives in youth development, health research, and community support

Governance Achievements

• 70% of assets under management (excluding real assets) classified under Articles 8 and 9 of SFDR
• More than 80% of Private Equity investments classified under Articles 8 and 9 of SFDR
• Established a Climate Action Centre to coordinate climate strategy
• Implemented ESG ratchets in unitranche and corporate lending

Climate Goals & Targets

Environmental Challenges

• Climate change and biodiversity loss
• Cybersecurity threats
• Need to accelerate the transition to a sustainable economy
• ESG data limitations for Scope 3 emissions

Mitigation Strategies

• Developed impact investment platform focusing on climate, biodiversity, and social inclusion
• Launched several impact funds dedicated to decarbonization and sustainable investments
• Implemented Sustainability by Design approach across investments
• Established partnerships with various organizations to promote sustainability and address social challenges
• Working on improving Scope 3 emission data using ISS and S&P Trucost data

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Rising sea levels
• Extreme weather events

Transition Risks

• Regulatory changes
• Technological changes
• Market shifts

Opportunities

• Investments in energy transition, renewable energy, and energy efficiency

Reporting Standards

Frameworks Used: SFDR, TCFD, UN SDGs, Paris Agreement, International Energy Agency's net zero roadmap, IPCC guidance, European taxonomy for sustainable activities

Awards & Recognition

• Responsible investor of the year, Europe (2022)

Environmental Metrics

ESG Focus Areas

• Carbon efficiency
• Circular economy
• Environmental and social safeguards
• UN Global Compact and OECD guidelines
• ESG risk management

Environmental Achievements

• Achieved a carbon intensity (scope 1, 2, 3, per million euro of revenues) lower than the investment universe. Portfolio coverage was at least 90% of assets.
• Engaged with 29 companies to discuss environmental topics and areas for improvement (47% of portfolio).

Social Achievements

• Promotes minimum environmental and social safeguards through exclusion criteria and SRI criteria.
• Score on human and labor rights controversies lower than the investment universe (coverage rate of at least 70% of assets).

Governance Achievements

• Promotes business activities in accordance with the UN Global Compact and OECD guidelines.
• Limits investments in companies with material ESG risk.

Climate Goals & Targets

Environmental Challenges

• Sustainability risks (although broadly diversified, it is not anticipated that any single Sustainability Risk will drive a material negative financial impact on the value of the Sub-Fund).

Mitigation Strategies

• Broad diversification of the fund.
• Engagement with management and governance bodies of certain issuers to support and accelerate sustainability measures.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: SFDR Article 8, UN Global Compact, OECD guidelines for Multinational Enterprises

Environmental Metrics

ESG Focus Areas

• Decarbonisation
• Nature and biodiversity
• Cybersecurity
• Resilient cities
• Regenerative agriculture

Environmental Achievements

• Finalised commitments under the Net Zero Asset Managers initiative (managing close to 40% of AuM in line with net zero goal).
• Successfully placed a new €300 million sustainable bond issue.
• 78% of the Group’s financing had an ESG component.

Social Achievements

• Launched the Tikehau Capital Foundation.
• Focus on social issues and diversity with portfolio companies, particularly in private equity, private debt, and real estate.
• 44% of permanent staff are women; 24% of managing directors and executive directors are women.

Governance Achievements

• 20% of employees’ variable compensation is linked to ESG objectives.
• A proportion of carried interest is linked to ESG criteria for impact funds.
• 66% of private debt financed with an ESG ratchet in 2023.

Climate Goals & Targets

Environmental Challenges

• Persistent inflation, tighter financing conditions, and increasingly stringent regulation.
• High valuations for both listed and unlisted equities.
• Staggering levels of global debt coupled with a slowdown in global growth (liquidity crisis).
• Rising financing, capital, and insurance costs for companies with poor sustainable development performance.

Mitigation Strategies

• Focus on investment discipline, impact, and sustainable value creation.
• Cautious and disciplined approach to investing, strong alignment of interests with investor-clients.
• High selectivity in investments.
• Positioning in private markets, entrepreneurial DNA, strong balance sheet supporting accelerated growth.
• Focus on megatrends such as cybersecurity, energy transition, regenerative agriculture, real estate asset transformation, and US infrastructure.

Supply Chain Management

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products
• Investment in decarbonisation and renewable energy

Reporting Standards

Frameworks Used: SFDR, TCFD, SASB

Awards & Recognition

• 2023 ESG Industry Top Rated company by Sustainalytics (top 4% of best performers)
• Private Debt Lender Award (Large Cap) by Private Equity Magazine’s annual Grands Prix 2023 (8th consecutive year)
• Asset Manager of the Year (Large category) by Environmental Finance IMPACT Awards 2023
• Best ESG Investment Fund: Energy Transition by ESG Investment Awards 2024
• Impact Project / Investment of the Year by ESG Investment Awards 2024
• Second place in EMEA Firm of the Year in Italy by PEI Awards 2023
• IJInvestor Restructure of the Year – North America award by IJGlobal’s IJInvestor Awards Americas 2023
• Platinum Award for Best Office REIT (Singapore) and Gold Award for Best Investor Relations by Asia Pacific Best of the Breeds REITs Awards 2023
• Three awards at the 30th edition of the Palmarès des Fournisseurs by Gestion de Fortune magazine, including “Company of the Year”

Environmental Metrics

ESG Focus Areas

• Climate Change
• Biodiversity
• ESG
• Governance
• Social

Environmental Achievements

• Finalized Net Zero Asset Manager (NZAM) objectives in March 2023, committing to managing nearly 40% of assets under management in line with the global target of reaching net-zero emissions by 2050.
• Implemented a revised fossil fuel exclusion policy in early 2023 restricting new direct financing of fossil fuel-dedicated projects and related infrastructure globally, as well as new direct investments in companies with significant exposure to fossil fuels.
• Aims to manage €5 billion in assets by 2025 earmarked for climate and biodiversity.

Social Achievements

• Enhancement of the Group’s Sustainability-themed and Impact platform.
• Reinforcement of ESG capabilities through the integration of a sustainability risk manager in 2023, the establishment of an ESG data IT platform, and the formalisation of methodological guides and of a RACI responsibility matrix with the investment and support teams.
• Inclusion of ESG considerations in the Group’s loans and bonds.
• Launched Tikehau Sustainability University in December 2022 with a dedicated mobile application for continuous training.

Governance Achievements

• Strong involvement across all levels of seniority in the roll-out of the ESG and Climate policies.
• Supervisory Board reviews the ESG and CSR strategy regularly.
• Creation of a Sustainable Bond Allocation Committee in March 2021 and a Climate Action Centre in April 2021.
• Updated Group's governance of sustainability issues to give it a medium-term strategic push and set up operational working groups by business line.
• Establishment of an Impact Committee for impact funds.

Climate Goals & Targets

Environmental Challenges

• Limited data availability on Principal Adverse Impacts (PAI) for Private Equity and Private Debt investments in the pre-investment phase.
• Managing climate and biodiversity-related risks in the portfolio.

Mitigation Strategies

• Conducting assessments to identify impacts on nature and biodiversity where relevant and necessary.
• Monitoring climate-related metrics of its investment portfolio in alignment with the PAI indicators defined by the SFDR and the TCFD.
• Using the R4RE tool to assess the exposure of real estate assets to climate-related physical risks.
• Commissioning an external expert to develop a sector-based screening tool to enhance climate-related transition and physical risk assessment.

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Sustained increased temperatures
• Sea level rise
• Flooding
• Fire
• Droughts
• Other weather calamities

Transition Risks

• Regulatory risks
• Technological risks
• Market risks
• Reputational risks

Opportunities

• Investment opportunities in decarbonization and carbon sinks

Reporting Standards

Frameworks Used: SFDR, TCFD, UN PRI, SASB, European Taxonomy