ESG

Integrated Approach

As a long-term investor, RiverRock actively seeks out investments with the potential to make a positive impact on poverty, the environment and society as a whole, as we believe that these investments stand to outperform in the long term.

Investment teams share an acute awareness of their duties as stewards of our clients’ assets and this perspective informs all of our investment decisions. Environmental, Social and Governance factors play a major role during the proposal stage of each investment opportunity being considered and we consider such factors as a fundamental component of our investment portfolio monitoring process.

RiverRock considers the UN’s Sustainable Development Goals (SDGs) in its investment process and ensures the compliance of its investment with its targets. We approach sustainability through a three pronged approach under the umbrella of the SDGs, first using a detailed ESG metrics checklist, then impact indicators tied to fund-specific criteria which we monitor on a regular basis.

RiverRock has implemented an integrated Environmental Social Management System (ESMS) which outlines a set of management processes and procedures with regards to ESG-related matters. The ESMS is a firmwide effort by our Senior Management, portfolio managers and respective support functions aiding in the identification, avoidance, minimisation, mitigation, offsetting and remedy of any environmental and social impacts inherent in its current and prospective investment portfolios.

Sustainability Risk Policy

As part of its responsible investing approach and recognition of sustainability-related financial disclosures, RiverRock integrates sustainability risks into the investment decision making process. In addition to following exclusionary criteria and a strict do no harm approach, we follow global norms on labour and business from organizations like the ILO, and go further by assessing how our counterparties address sustainability factors material to the strategies such as climate risks, employment practices, respect for human rights, and governance, including anti-corruption and anti-bribery.

Adverse sustainability impact

As part of our origination and due diligence process we incorporate the consideration of principal adverse impacts of investment decisions on sustainability factors and we endeavour to exclude investments that have a material negative effect on sustainability; whether in terms of the community, the environment or biodiversity.

We do this through a multi-level process from an exclusions list, to an ESG checklist, to impact indicators mapped to the SDGs and IRIS which are monitored throughout the life of the investment.

We believe that managing the material sustainability factors provides downside protection and can be a potential source of positive performance.

Sustainability risks and factors are not considered relevant for liquid strategies due to the short holding time of the positions and therefore are not taken into account in the investment decision-making process.

Remuneration policy

RiverRock has a firm-wide remuneration policy which reflects the firm’s objectives for good corporate governance and transparency around our compensation strategy as well as implementing any regulatory requirements.  The remuneration policy enables the firm to attract, develop and retain high-performing professionals within a competitive market and ensures that we offer compensation packages which are market aligned and balance a number of components.  Individual remuneration is designed to reward performance within a meritocratic environment and one of the performance measures is the application of Environmental, Social, and Governance risk factors including long term sustainability of investments and relationships.

Workplace wellbeing is important to us and we seek to ensure the creation of a healthy, balanced, safe working environment for RiverRock staff and the promotion of those values at our investee companies through our governance processes.  We encourage a culture of inclusiveness and respect and support staff to balance their mental, physical and emotional wellbeing through internal and external resources.

Independent Oversight

To further embed responsible investing into everything we do, RiverRock has appointed an external agency to support RiverRock’s pioneering work in this area. This agency is a leading ESG and impact-focused advisory firm and will support RiverRock with;

• Design, implementation and continuous improvement of RiverRock’s responsible investment policies and practices
• Monitoring of RiverRock’s compliance with its responsible investment obligations
• Overseeing and supporting RiverRock’s responsible investment reporting

Diversity

RiverRock is committed to continuously improving diversity across the Firm and seeks to support companies that share this commitment to improving diversity at all levels.

Our Commitments

RiverRock is a signatory to the United Nations Principles for Responsible Investment (UNPRI) and has committed to adhere to the Principles where they are consistent with RiverRock’s fiduciary responsibilities. We believe the UNPRI are consistent with both RiverRock’s longstanding values and the independence of the various teams’ investment processes.

RiverRock, through its various funds, is supportive of the 2030 Agenda for Sustainable Development adopted by the United Nations Member States in 2015.  Among the Sustainable Development Goals (“SDGs”),  RiverRock is particularly focusing:

• On the following SDG Goals(https://sdgs.un.org/goals):
  • 8, 9, 11 and 12 for its RiverRock Brownfield Infrastructure Fund.
• On the following SDG Goals(https://sdgs.un.org/goals):
  • 7, 8, 11 and 13 for its RiverRock Senior Loan Fund.

RiverRock is supporter of TCFD (Task Force on Climate related financial disclosures).

ESG ACTIONS

Through its funds, RiverRock is implementing several actions and initiatives as per of its ESG strategy at corporate and portfolio company levels.

For example, RiverRock has implemented the following ESG actions:

As part of RiverRock’s commitment to responsible investment, RiverRock produces an annual report on its responsible investment activity.