Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance
• UN Sustainable Development Goals (SDGs)

Environmental Achievements

• HBM portfolio companies have inherently low carbon emissions and natural resource use due to their R&D focus.

Social Achievements

• HBM actively contributes to improvements in health and well-being by providing capital to firms within the healthcare industry.
• HBM promotes diversity in the workplace and is an equal opportunities employer.

Governance Achievements

• HBM adheres to the highest standards and values of business conduct and implements appropriate preventive procedures against illegal or harmful practices.
• HBM actively influences its portfolio companies’ strategies with respect to ESG principles through active ownership (proxy voting for public companies and board representation for private companies).

Climate Goals & Targets

Environmental Challenges

• Lack of standardized and comparable frameworks for measuring ESG/SDG performance leading to greenwashing.
• Absence of external rating providers for private companies, resulting in reliance on company management information.

Mitigation Strategies

• HBM monitors developments in regulatory frameworks and investor demand proactively.
• HBM uses ISS DataDesk and ISS ESG Fund Rating for monthly ESG/SDG performance screening of public portfolio companies.
• HBM performs semi-annual portfolio reviews for private equity investments, including ESG/SDG related developments.
• HBM relies on traditional investment parameters when ESG/SDG data is unavailable for non-transparent assets.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: SFDR (Sustainable Finance Disclosure Regulation)

UN Sustainable Development Goals

• 3
• 5
• 8
• 9
• 10
• 12
• 13

HBM's investment in healthcare contributes to several SDGs, particularly those related to health, gender equality, economic growth, innovation, reduced inequalities, responsible consumption, and climate action.

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• Declining valuations for technology and growth stocks due to inflation and rising interest rates.
• Strong valuation corrections in the small and medium-sized company segment.
• Slowing economic growth and restrictive Covid-19 policies in China affecting Cathay Biotech valuation.
• US FDA denial of marketing approval for omburtamab by portfolio company Y-mAbs Therapeutics.

Mitigation Strategies

• Four profitable acquisitions (Turning Point Therapeutics, Sierra Oncology, ChemoCentryx, Biohaven Pharmaceuticals).
• Numerous follow-on investments in existing private companies.
• Selective expansion of the public company portfolio using favorable valuation levels.
• Continued distribution policy with a planned yield of 3.5 percent.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance
• UN Sustainable Development Goals (SDGs)

Social Achievements

• Promoting diversity in the workplace
• Providing capital to firms within the healthcare industry, creating jobs and a dynamic working environment

Governance Achievements

• Adhering to laws and regulations; implementing preventive procedures against illegal or harmful practices, bribery, corruption, collusion and money laundering
• Annual training for all employees on HBM policies

Climate Goals & Targets

Environmental Challenges

• Lack of standardized and comparable frameworks for measuring ESG/SDG performance leading to greenwashing
• Absence of external rating providers for private companies, resulting in reliance on management information

Mitigation Strategies

• Closely monitoring developments in regulatory frameworks and investor demand to adapt accordingly
• Implementing processes exceeding Art. 6 SFDR requirements
• Considering a potential classification of Art. 8 SFDR if reasonably feasible
• Relying on traditional parameters for investment decisions and monitoring in the absence of ESG/SDG data for non-transparent assets

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: SFDR

UN Sustainable Development Goals

• Goal 3: Good health and well-being
• Goal 5: Gender equality
• Goal 8: Decent work and economic growth
• Goal 9: Industry, innovation and infrastructure
• Goal 10: Reduced inequalities
• Goal 12: Responsible consumption and production
• Goal 13: Climate action

HBM's investment in healthcare contributes to improving health and well-being; active ownership influences portfolio companies' strategies regarding gender equality, decent work, responsible consumption, climate action, and reducing inequalities; investments promote industry innovation and infrastructure.