Responsible Investment policy
Responsible Investment policy
3i Group is a signatory to the UN Principles for Responsible Investment (“RI”) and has embedded RI policies in its investment and asset management processes. The Investment Manager's philosophy on RI can be summarised as follows:
- The effective assessment and management of environmental, social, business integrity and corporate governance matters has a positive effect on the value of portfolio companies, and hence on 3i Infrastructure;
- Compliance with local laws and regulations may not be enough to meet global expectations, deliver value and enhance its reputation and licence to operate; and
- It is vital that the Investment Manager seeks to identify all material environmental, social and governance (“ESG”) risks and opportunities through its due diligence and effectively manages them during the period of the Company’s investment.
The Investment Manager's RI policy makes clear that it aims to use its influence to try to promote a commitment in its portfolio companies to:
- Comply, as a minimum, with applicable local and international laws and regulations relating to the environment, human rights, workers’ rights, health & safety and sanctions
- Identify, monitor and mitigate adverse environmental and social risks and opportunities arising from their activities and, where applicable and reasonably possible, within their respective supply chains
- Uphold high standards of business integrity and good corporate governance
- Within a reasonable timeframe following investment, meet minimum requirements in relation to ESG, and
- set near-term science-based emissions reduction targets within a reasonable timeframe where the portfolio company is in scope of 3i’s own science-based emissions reduction targets and where SBTi provides a decarbonisation pathway for that portfolio company
The main features of the policy include:
- Clear statements of the commitment to mitigate adverse environmental and social impacts and uphold high standards of business integrity and good corporate governance
- An exclusion list of businesses and activities in which investment is precluded
- A referral list of businesses and activities which may be particularly sensitive and may require additional scrutiny
- A set of minimum ESG standards that portfolio companies should meet, either at the time of investment or within a reasonable period thereafter.
Science-Based Targets initiative
The Science-Based Target Initiative (“SBTi”) validated 3i Group’s near-term emissions reduction science-based targets (“science-based targets”) in March 2024.
3i Group’s science-based targets cover its direct Scope 1 and 2 emissions and the Scope 3 emissions associated with its portfolio and have been formulated in line with the guidance published by SBTi for the private equity sector.
The boundary of the targets for portfolio emissions includes all eligible assets managed by 3i Investments and other asset managers owned by 3i Group plc, including 3i Infrastructure’s assets.
Please refer to the 3i Group website for details of the targets or page 41 of 3i Group plc's 2024 Annual Report.
In FY24, two of our portfolio companies, Joulz and Ionisos, set near-term science-based reduction targets, using the pathway tailored for small and medium-sized enterprises.
Approach to TCFD reporting
The Investment Manager is required to publish a TCFD Entity report and a TCFD Product report (with respect to 3i Infrastructure plc) in line with the Financial Conduct Authority (‘FCA’)’s rules to which it is subject.
The TCFD Entity report covers the Investment Manager’s approach to governance, strategy, and risk management, and metrics and targets related to climate change, as well as its approach to climate-related scenario analysis. Where possible, the Entity report relies on the 3i Group TCFD report.
The TCFD Product report for 3i Infrastructure plc describes any material deviations from the Entity report, as well as key climate-related metrics and climate change scenario analysis.
Please refer to the 3i Group plc website for the reports mentioned above.
Governance
We govern the Company and, through the Investment Manager, the assets in which we invest so as to support our sustainability objectives. The Investment Manager's engaged asset management approach seeks to improve and enhance the governance of businesses that we acquire, through implementing and upgrading policies and procedures as a priority following a new investment, working with management teams to define long term sustainable business plans, and working with lenders and other providers of finance to put in place sustainable financing.
Bribery Act
The Company does not offer, pay or accept bribes and is committed to working only with third parties whose standards of business integrity are substantively consistent with its own. The Company also expects the businesses it invests in to commit to avoiding corruption in all its forms and to comply with anti-bribery, anti-fraud and anti-money laundering laws applicable to them. The Company has an anti-bribery policy and is fully compliant with the provisions of the UK Bribery Act.
Procurement
3i Infrastructure has developed policies and procedures in relation to the procurement of services received from third-party providers. As far as possible, the Company will work only with suppliers who support its aim to source products and services responsibly. 3i Infrastructure aims to have a collaborative relationship with its service providers and, wherever possible, will work with them when problems or issues arise to help them meet its requirements.
Prompt Payment Code
3i Group performs most payment and treasury functions for the Company and is a signatory to the Prompt Payment Code. The Code encourages and promotes best practice between organisations and their suppliers. Signatories to the Code commit to paying their suppliers within clearly defined terms, and to ensuring there is a proper process for dealing with any issues that may arise.
Modern Slavery Act
The Board is committed to investing responsibly and notes the statement made by 3i Group plc under Section 54 of the Modern Slavery Act 2015 (“MSA”), which applies to the Company’s Investment Manager. The Company itself is not subject to the MSA as it is a Jersey company.
Whistleblowing
Our Whistleblowing Policy sets out how to deal with any concerns
Equal Opportunities and Diversity Policy
The Company applies 3i Group’s Equal Opportunities and Diversity Policy in so far as it is appropriate to the non-executive Directors of the Company.
