DISCLOSURES IN ACCORDANCE WITH REGULATION (EU) 2019/2088 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL OF 27 NOVEMBER 2019 ON SUSTAINABILITY‐RELATED DISCLOSURES IN THE FINANCIAL SERVICES SECTOR (THE “SFDR”)
TRANSPARENCY OF SUSTAINABILITY RISK POLICIES (Article 3, SFDR)
For the purposes of these disclosures, “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 an investment.
Material business or legal risks (including sustainability risks) could cause Berkshire Partners to decline an investment opportunity absent an actionable plan for mitigating such risks during ownership. As part of its due diligence process, Berkshire Partners evaluates, among other things, the company’s industry, size, and geographic presence to help determine the materiality of such risk factors, including those related to responsible investing.
During late-stage investment diligence, Berkshire Partners expects to systematically deploy its proprietary scorecard assessing potentially material sustainability risks. Material findings identified that require further discussion will be included in the final investment memorandum for the investment staff to consider as part of its evaluation of the potential investment. If Berkshire Partners believes there may be material risks, Berkshire Partners internal teams and/or external legal counsel may probe further and/or engage a third-party specialized resource if necessary.
As a result of following this process, Berkshire Partners does not anticipate that sustainability risks will have a material negative impact on returns, although there can be no guarantee that the process will successfully identify and mitigate all material risks.
TRANSPARENCY OF ADVERSE SUSTAINABILITY IMPACTS AT ENTITY LEVEL (Article 4, SFDR)
Berkshire Partners does not currently consider adverse impacts of investment decisions on sustainability factors as specifically set out in the SFDR. Berkshire Partners has chosen not to do so for the present time as it considers that its existing approach to responsible investing is appropriate, proportional and tailored to the investment strategy of its funds.
