A robust, rigorous analysis methodology for all our investments

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Core to our identity and based on 10 years of experience, our ESG and impact analysis practices are underpinned by a robust, rigorous methodology. This methodology also reflects the iterative and incremental processes that have been in place for several years and the continuous enhancements made by our team to meet our clients’ needs and increasingly strict regulatory requirements.

Sector exclusions

Every investment opportunity is analysed to assess its compliance with sector-based policies relating to weapons and fossil fuels, as well as additional specific exclusions demanded by our clients.

Controversy analysis

Reputation research is conducted as early as possible before an investment and throughout the investment life cycle to identify any past incident or ESG controversy that could warrant a more in-depth investigation or challenge the investment decision.

Taxonomy alignment

Our analysis includes an assessment of the eligibility and, if applicable, the alignment of the investment’s activities with the EU Taxonomy.

Sustainable investments under the SFDR

Any potential direct investment in connection with one of our Article 9 strategies as classified under the SFDR is considered in light of our definition of a sustainable investment.

Fund selection

In our multi-strategy investment activity, our fund selection approach aims to overweight investments in funds managed by asset management firms with the highest ESG maturity and to underweight investments in funds managed by firms that are lagging in ESG integration but are working to improve their practices. Accordingly, allocation rules taking into account target ESG scores are defined for each investment vehicle.  

Material ESG issues

Our ESG analysis for direct investments focuses on identifying and assessing the most material issues for the company and its sector, on which depend the sustainability of the company’s business model and its impact on society and the environment. This analysis enables the identification of potential risk areas and recommendations for improvement.

NEC score

For companies in which we make a direct investment, where the data is available, we measure the contribution of their business models to the Net Environmental Contribution, on a scale from -100% for activities that are the most destructive of natural capital to +100% for activities that best accelerate the environmental transition.

ESG markers

Four ESG “markers” act as a guiding compass, aligning SWEN’s purpose and our investments: access in regions to essential goods and services, equitable sharing of value creation, the promotion of diversity at every level and the protection of the environment.

Nature-related issues

Nature-related issues are systematically incorporated into the decision-making process involved in any new investment opportunity. We analyse physical risks related to climate change and biodiversity loss as well as transition risks represented by the uncertain financial impacts of a low-carbon or nature-based business model (regulatory risks, technological risks, market risks, reputation risks, new regulatory standards, new consumption behaviors, etc.). In our fund investment activity, we assess the nature-based practices of the relevant management companies.

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ESG clauses

During the contracting phase implementing any investment decision, we specify the need for the investee company or the selected management company to report on its sustainability practices every year during our ESG data collection operation and to comply with the ESG clauses in our exclusion policies.

Monitoring and improvement of practices

For more than 10 years, our ESG team has conducted an annual operation to collect data on the ESG practices of more than 200 management firms and 2,000 companies to assess the ESG performance of our investments, prepare reliable regulatory reports and implement improvement action plans, as needed, to support our portfolio companies.

Reporting

We communicate the results of our sustainable approach and investing strategies to all our stakeholders through a range of channels, which include annual ESG reports, impact reports, Article 29 Energy and Climate Law reports, an analysis of SFDR compliance, an assessment of carbon and biodiversity footprints and an analysis of our investments’ contributions to the UN’s Sustainable Development Goals.

Industry collaboration and initiatives

We are actively involved in major national and international industry initiatives to promote the integration of sustainability risk considerations and ESG and impact criteria in private markets. Our ESG Best Practices Honours awards, held every year since 2014, also support this aim.

ESG research and innovation

In addition to preparing and following up on investment cases, our ESG team continuously improves our processes and policies to anticipate market trends and our clients’ needs. This drive to innovate is reflected in the fund investment strategies we develop and the customised tools we design.

Sustainable finance at SWEN

Expertise & engagement

Expertise & engagement

All our decisions are governed by one guiding principle, which is to invest responsibly, based on objective criteria and rigorous analyses.

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ESG analysis methodology

Analysis methodology

Our ESG and impact analysis practices are underpinned by a robust, fully tested methodology that is continuously enhanced by our team.

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Climate & Biodiversity

Climate & Biodiversity

To help regenerate ecosystems, we are taking all Nature-related issues, which are interdependent, into consideration in our investment decisions.

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Impact investments

Impact finance

The ambition of our impact approach is to accelerate the fair and sustainable transformation of the economy by offering clear proof of its positive effects.

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Our ESG publications

ESG publications

Our publications present SWEN’s responsible investing philosophy, describe our methodologies in detail and ensure efficient, transparent reporting.

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