Disclosures on sustainability.
The EU Sustainable Finance Disclosure Regulation (regulation EU 2019/2088, abbreviated “SFDR”) came into effect on 10 March 2021 and requires financial market participants and financial advisors to provide disclosures on specific topics concerning sustainable finance.
The following disclosures apply to Levantor Advisory.
INTEGRATION OF SUSTAINABILITY RISKS INTO THE INVESTMENT PROCESS
This section refers to the requirements of art. 3 of Regulation (EU) 2019/2088 for financial market participants and financial advisors to disclose the entity's guidelines for integration of sustainability risks into the investment process.
In accordance with the SFDR, Levantor Advisory AS ("Levantor") is to disclose how sustainability risks are integrated into the investment advice provided to Levantor's clients.
At Levantor, ESG considerations are an integral part of the investment process, as we believe that responsible investing is paramount to generating long-term financial returns. Careful ESG assessments of evaluated investment opportunities are made as part of the analysis process.
As Levantor is an investment advisor focusing on Private Equity, sustainability risks are considered in Levantor’s investment analysis at the portfolio fund manager level, whereby the target fund manager's ESG track record, capabilities and commitments are carefully evaluated as part of the overall manager assessment. Where applicable, e. g. in co-investments in portfolio companies together with the portfolio fund manager, sustainability risks are evaluated at the company level.
CONSIDERATION OF PRINCIPAL ADVERSE IMPACTS ON SUSTAINABILITY FACTORS
This section refers to the requirements of art. 4 of Regulation (EU) 2019/2088 for financial market participants and financial advisors to disclose whether principal adverse impacts of investment decisions or advice on sustainability factors are considered as part of the investment decision or advice.
In accordance with the EU regulation on sustainable finance disclosure ("SFDR"), Levantor Advisory AS ("Levantor") is to disclose to what extent, if any, principal adverse impacts of investment decisions on sustainability factors are considered as part of the investment recommendation process. A "principal adverse impact" as understood by the Regulation is a consequence of an investment decision which negatively affects one or more sustainability factors. This disclosure requirement can be met on a “comply or explain” basis.
Levantor does not take “principal adverse impact” into consideration in our investment recommendations. Our clients are investors in private equity funds and therefore do not make decisions on which individual assets will ultimately form part of their portfolio. Levantor will nevertheless take appropriate measures to eliminate or mitigate negative impact on the environment and society, caused by clients' investments. As part of our investment recommendations, Levantor will consider ESG criteria including but not limited to:
The track record of the prospective Portfolio Fund manager with respect to ESG and responsible investment
The prospective Portfolio Fund manager's internal ESG capabilities, policies and structures
Exclusion and other ESG criteria for the client
Levantor’s clients may subscribe to new private equity funds, in which case the asset portfolio is unknown at the time when Levantor makes its investment recommendation. As such, Levantor cannot meaningfully measure or evaluate which specific principal adverse impacts, if any, can be attributed to the investment opportunity. Therefore, Levantor has implemented measures as described above to secure the mitigation of negative impacts of the investment recommendations, with respect to responsible investment, throughout the investment value chain.
REMUNERATION AND INTEGRATION OF SUSTAINABILITY RISKS
This section refers to the requirements of art. 5 of Regulation (EU) 2019/2088 for financial market participants and financial advisors to disclose how remuneration principles relate to the integration of sustainability risks disclosed under art. 3 of the SFDR.
Levantor requires relevant employees to adhere to its investment recommendation processes, including with respect to ESG considerations. Failure to adequately incorporate ESG factors into investment recommendations may negatively affect the remuneration of the employee.