Sustainability-related disclosures
Agricultural Commodity Transformation Fund C.V. (ACT Fund)
SFDR classification: Article 8
Summary
The ACT Fund promotes environmental and social characteristics within the meaning of Article 8 of Regulation (EU) 2019/2088 (SFDR).
The Fund provides financing to agricultural businesses, with a focus on businesses connected to smallholder farmers. The environmental and social characteristics promoted by the Fund relate to smallholder livelihoods and inclusion, climate resilience and regenerative agricultural practices.
These characteristics are integrated into the Fund's investment selection, due diligence and monitoring processes. The Fund also assesses the good governance practices of investee companies.
The Fund has not designated an index as a reference benchmark.
No sustainable investment objective
This financial product promotes environmental or social characteristics, but does not have as its objective sustainable investment.
Environmental or social characteristics of the financial product
The Fund promotes the following environmental and social characteristics:
- improved livelihoods and economic inclusion of smallholder farmers;
- climate resilience and regenerative agricultural practices; and
- inclusion, including the participation of women in agricultural value chains.
Investment strategy
The Fund provides primarily private credit financing to agricultural businesses, including processors and exporters connected to agricultural producers and smallholder farmers.
Environmental, social and governance considerations form part of the Fund's investment selection, due diligence and monitoring processes.
The Fund assesses good governance practices of investee companies, including sound management structures, employee relations, remuneration of staff and tax compliance.
Proportion of investments
The Fund does not currently commit to making investments that qualify as sustainable investments within the meaning of Article 2(17) SFDR.
Monitoring of environmental or social characteristics
The environmental and social characteristics promoted by the Fund are monitored throughout the investment period using sustainability indicators applicable to the relevant investment.
Monitoring is based primarily on information provided by investee companies and, where appropriate, supporting documentation and other monitoring activities.
Methodologies
The Fund assesses whether the environmental and social characteristics are met through its investment selection, due diligence and ongoing monitoring processes and by reference to the sustainability indicators established for the relevant investments.
Data sources and processing
Data are primarily obtained from investee companies and may be supplemented by supporting documentation and other sources where appropriate.
The Fund reviews information received for consistency and reasonableness. Where estimates are used, this is taken into account in the Fund's assessment and reporting.
Limitations to methodologies and data
The availability, consistency and quality of sustainability data may vary between investee companies and markets.
The Fund addresses these limitations through its due diligence and monitoring processes and, where appropriate, by seeking additional information or clarification from investee companies.
Due diligence
Environmental, social and governance considerations are incorporated into the Fund's due diligence of prospective investments.
The scope of due diligence is proportionate to the nature and risk profile of the investment. Where appropriate, identified matters may be addressed through investment conditions, contractual undertakings or action plans.
Engagement policies
The Fund engages with investee companies, where appropriate, as part of its monitoring of environmental and social matters.
Where material sustainability-related issues are identified, the Fund may seek additional information and appropriate corrective measures from the investee company.
Designated reference benchmark
No index has been designated as a reference benchmark for the purpose of attaining the environmental or social characteristics promoted by the Fund.
