The Dutch Founders Fund B.V. (“Dutch Founders”) and the portfolio companies which it advises have a mission to build a sustainable, resilient, diverse, inclusive and tech-enabled ecosystem in Europe and beyond.
This document (the “ESG Policy”) sets out Dutch Founders’s approach to investing responsibly, which includes our take on Environmental, Social, and Governance (“ESG”) issues, as well as our commitment to contribute to a better tomorrow. The policy and her implications apply to all of the funds, existing portfolio companies, new investments and Dutch Founders’s business operations. We strive to adhere to this ESG policy at all times.
Moreover, this document will serve to illustrate how our fund has implemented procedures and guidelines to meet our ESG goals and standards.
The Dutch Founders Fund B.V. (“Dutch Founders”) and the portfolio companies which it advises have a mission to build a sustainable, resilient, diverse, inclusive and tech-enabled ecosystem in Europe and beyond.
As of this writing, Dutch Founders has stipulated the following factors in our interpretation of the ESG-standards in investing responsible:
- Environmental Factors: the pollution and contamination of land, air and water, and related legal and regulatory compliance; eco-efficiency; waste management; management of scarce natural resources; climate change impacts; biodiversity; and the development of new technologies, products and markets e.g. ‘green’ / sustainable products and services.
- Social Factors: the treatment of employees including their pay; health and safety; labour conditions; human rights; any form of discrimination, harassment or victimization; diversity and inclusion, supply chain management; the treatment of all stakeholders including customers and communities, and actively involving our direct and indirect community to built towards a sustainable society.
- Governance Factors: anti-bribery and corruption measures; business ethics; accountability; transparency; conflicts of interest; whistle-blowing; control mechanics; and the governance of environmental and social factors. Dutch Founders also accounts for reporting as a key Governance-factor. We vet our portfolio companies and ourselves to report diligently, with care and on time.
The abovementioned factors are by no means exhaustive and Dutch Founders will frequently revist and refine our interpretation of it.
Dutch Founders’ Approach to ESG
At the Dutch Founders Fund, we firmly believe that entrepreneurs are the catalysts in changing the world for the better. We know that doing good for the planet and making money are not mutually exclusive, and therefore we have set out on a mission to fund companies that create societal, financial, personal and environmental impact.
The ESG principles serve as the core of our investmentional rationale, purpose, norms and values. We recognize that adherence to the ESG principles might impact the success of our investments - both positive and negative. Most importantly, we also recognize the major role that venture capital funds such as ourselves play in bringing ever-lasting change in the world. We don’t just passively finance those who challenge the status quo, we deploy our experience, network and know-how to make sure that our portfolio companies are contributing to society at large. A genuine focus on doing well for their own employees, customers, suppliers, the environment, shareholders and anyone else involved is the key ingredient to success. In the end, creating long lasting value will allow everyone to reap the fruits of progress.
We actively challenge our team and our portfolio companies to abide by the highest standards. The Dutch Founders Fund strives to invest in those who rate high on our ESG-index. This means that we look for companies who use sustainability as a key value-driver.
It is important to note that our investment policy does not necessarily focus on financial products that aim to be purely sustainable investments, the so-called 'impact investments'. Neither does our fund focus on financial products with sustainable characteristics in particular, as we are often unable to adequately assess the sustainability risks and their effects on the financial results of the investments. Where we van demonstrably quantify these negative effects, we aim to take them into account in our investment decisions.
Dutch Founders’s commitment to ESG
At Dutch Founders, the ESG principles are deeply rooted in our culture and our screening process. Across the entire investment cycle, from initial assessment to due diligence, ownership and exit, we always do our utmost to ensure that the ESG factors are safeguarded. This includes the following:
- Assuring strong ESG governance over the entire business line: Everyone at Dutch Founders Fund keeps each other informed about recent developments within the realm of ESG. We strive to involve and inform all relevant stakeholders about our ESG mandate on a constant basis. We organize seminars and have set out to provide resources for those who want to be more informed.
- Supporting our portfolio companies on their ESG policies: We actively encourage our portfolio companies and the founders we work with to live and breathe the ESG principles. Where possible and appropriate, we will work with our portfolio companies to develop a toolkit to provide additional support on implementing best practices. We also partner with our portfolio companies on ESG related term sheet clauses. The term sheet requirements may, depending on each portfolio company, include board representation, appointment, voting, audit, fraud, reporting and financial reporting.
- Implementing ESG in our entire investment process: As a major part of our investment process, we frequently assess and revisit investment-opportunities on their ESG-related risks. These include - but are not limited to - issues related to the environment/climate, diversity, ethics, anti-money-laundering and bribery, anti corruption, diligent and transparent reporting. We work closely together with a team of industry experts with profound knowledge of matters related to compliance and ESG to make sure that all processesses are executed according to the most recent standards. Where appropriate or deemed necessary, Dutch Founders will instruct these external experts to perform additional ESG due diligence on potential portfolio companies. If the ESG risks related to a potential investment are deemed too great and/or cannot be appropriately mitigated in a reasonable timeframe, we will not continue with the investment process.
- Creating a diverse and inclusive environment: We strongly encourage women, BIPOC, the LGBTQIA+ community, people with disabilities and other underrepresented groups to apply to our fund. Whether you seek investments or are looking for a next step in your career, the Dutch Founders Fund welcomes everyone.
- Constant monitoring: Via the proprietary software of our portfolio company Blanco, we constantly monitor and screen all of our stakeholders on AML, anti-terrorism, source of funds and overall background.
