SFDR sustainability disclosures – Early Game Ventures Fund II Coöperatief U.A. (the “Fund”)
Early Game Partners B.V. (the “Fund Manager”) is a financial market participant as defined in the Sustainable Financial Disclosure Regulation (EU) 2019/2088 (the “SFDR“) amended by Regulation (EU) 2020/852 (the “Taxonomy Regulation“) as in force since March 10, 2021.
The Fund Manager manages funds that do not promote sustainability nor have they sustainability investment as their objective.
The following definitions are relevant:
A “sustainable investment” is defined as an investment in an economic activity that contributes to an environmental objective, as measured, for example, by key resource efficiency indicators on the use of energy, renewable energy, raw materials, water and land, on the production of waste, and greenhouse gas emissions, or on its impact on biodiversity and the circular economy, or an investment in an economic activity that contributes to a social objective, in particular an investment that contributes to tackling inequality or that fosters social cohesion, social integration and labor relations, or an investment in human capital or economically or socially disadvantaged communities, provided that such investments do not significantly harm any of those objectives and that the investee companies follow good governance practices, in particular with respect to sound management structures, employee relations, remuneration of staff and tax compliance.
“No significant harm” means that for each environmental objective, uniform criteria for determining whether economic activities contribute substantially to that objective should be laid down. One element of the uniform criteria should be to avoid significant harm to any of the environmental objectives. This is in order to avoid that investments qualify as environmentally sustainable in cases where the economic activities benefitting from those investments cause harm to the environment to an extent that outweighs their contribution to an environmental objective.
“Environmental objective” means the objectives as laid down in Article 9 of the Taxonomy Regulation, being the following objectives:
climate change mitigation (Art. 10), the process of holding the increase in the global average temperature to well below 2 °C and pursuing efforts to limit it to 1,5 °C above pre-industrial levels, as laid down in the Paris Agreement;
climate change adaptation (Art. 11), the process of adjustment to actual and expected climate change and its impacts;
the sustainable use and protection of water and marine resources (Art. 12);
the transition to a circular economy (Art. 13), an economic system whereby the value of products, materials and other resources in the economy is maintained for as long as possible, enhancing their efficient use in production and consumption, thereby reducing the environmental impact of their use, minimizing waste and the release of hazardous substances at all stages of their life cycle, including through the application of the waste hierarchy;
pollution prevention and control (Art. 14);
the protection and restoration of biodiversity and ecosystems (Art. 15).
“Promoting sustainability” means a fund promotes among other characteristics, environmental or social characteristics, or a combination of those characteristics, provided that the companies in which the investments of the fund are made, follow good governance practices. These are called article 8 SFDR products.
“Sustainability risk” means an environmental, social or governance event or condition that, if it occurs, could cause an actual or a potential material negative impact on the value of the investment.
“Sustainability factors” mean environmental or social and employee matters, respect for human rights, anti‐corruption and anti‐bribery matters. This is what is or can be impacted by investment decisions.
Transparency of sustainability risk policies and transparency of the integration of sustainability risks– article 3(1) SFDR
The Fund Manager does not integrate sustainability risks in its investment decision-making process for the following reasons:
the performance tools used by the Fund Manager to estimate returns of the funds it manages (including the Fund) do not take into account such risks but mainly economic and financial risks;
since the portfolio companies in which the funds it manages invest do not usually report on such risks, the Fund Manager is not in a position to assess and integrate such risks in its investment decision-making process;
the Fund Manager is managing (i) Early Game Ventures Fund I Coöperatief U.A. that invests in SME in the field of research and development and (ii) the Fund that intends to invest exclusively in portfolio companies with IT&C generalist and IP-centric businesses, for which the returns should not be impacted by sustainability risks; and
in view of the Fund Manager size it is not intended to change the investment decision-making process of the Fund Manager to integrate such sustainability risks as this will be too costly and not relevant with respect to the funds it manages.
No consideration of adverse impacts of investment decisions on sustainability factors – article 4(1)(b) SFDR
SFDR requires fund managers such as the Fund Manager to provide a clear statement as to whether or not they consider the “principal adverse impacts” of investment decisions on sustainability factors.
In case such fund manager does not consider such principal adverse impacts, SFDR requires it to include clear reasons for why they do not do so, including, where relevant, information as to whether and when they intend to consider such adverse impacts.
The Fund Manager does not consider the adverse impacts of its investments decisions on sustainability factors at its own level and in respect of investments of the Fund in the manner prescribed by SFDR due to (i) the venture capital investment objectives of the investments that do not take sustainability into account, (ii) the lack of reliable and sufficiently available or accessible data to perform such impact measurement and to provide the mandatory reporting imposed by the regulatory technical standards in a consistent manner, and (iii) the underlying investments in seed and pre-seed portfolio companies are not generally required or able to report on such factors in the manner prescribed by SFDR.
The Fund Manager does not intend to consider principal adverse impacts of investment decisions on sustainability factors in the near future.
No remuneration policy in place – article 5(1) SFDR
The Fund Manager does not have a remuneration policy in place in light of the fact that it qualifies as a registered alternative investment fund manager within the meaning of article 3(2)(b) of Directive 2011/61/EU of 8 June 2011 on alternative investment fund managers (the “AIFMD”) and thus does not fall under such requirement under the AIFMD.
Tell us about your companyFill in the application form