Sustainability Risk Policy Statement
KBA Consulting Management Limited (“KBA”) is a UCITS management company and alternative investment fund manager (“AIFM”) authorised and regulated by the Central Bank of Ireland (the “Central Bank”) pursuant to the Undertakings for Collective Investment in Transferable Securities, Regulations 2011 as amended (the “UCITS Regulations”) and the European Union (Alternative Investment Fund Managers) Regulations 2013 (S.I. 257 of 2013) (the “AIFM Regulations”). KBA provides management services to a variety of investment funds. It has delegated investment management activities, including portfolio management, with respect to such investment funds to a variety of investment managers (the “Investment Managers”) in accordance with the requirements of the UCITS Regulations, the AIFM Regulations and the Central Bank.
As part of this delegation arrangement, KBA expects that the consideration and management of sustainability factors and sustainability risks are performed by the underlying portfolio management teams responsible for investment decision making at each delegated Investment Managers. Sustainability factors within the meaning of 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 ( “SFDR”) are defined as environmental, social and employee matters, respect for human rights, anti-corruption and anti-bribery matters. Sustainability risk is defined as 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. The sustainability risks could include but are not limited to, risks stemming from climate change, natural resource depletion, environmental degradation, human rights abuses, bribery, corruption and social and employee matters.
KBA provides oversight of its delegated Investment Managers to ensure that all functions delegated are operating in line with applicable regulations including SFDR, industry best practice and in line with stated objectives. This oversight also includes monitoring the delegated Investment Managers’ approach to sustainability which may involve monitoring the relevant teams in place at the delegated Investment Managers to manage such sustainability factors and sustainability risks on an ongoing basis.
No Consideration of Sustainability Adverse Impacts
KBA does not expect to conduct principal adverse impact (“PAI”) reporting on behalf of the investment funds that it manages. After consideration of the PAI framework, KBA has determined that the aggregation of its delegated Investment Managers’ PAI reporting (where available) is of no value to its stakeholders due to the vast range of investment strategies and approaches to sustainability risk integration of its Investment Managers. KBA expects that each delegated Investment Manager that has indicated that it will complete PAI reporting will do so as required and in line with the regulations. KBA will keep the decision to not consider the adverse impacts on sustainability factors within the meaning of SFDR under review and will formally re-evaluate this decision on a periodic basis.
KBA has updated its remuneration policy to meet the requirements of SFDR. KBA expects that the remuneration policies of its Investment Managers are aligned with the ESMA guidelines and SFDR (where appropriate). KBA’s remuneration policy is designed to ensure that the remuneration of key decision makers is aligned with the management of short and long-term risks, including the oversight and where appropriate the management of sustainability risks in line with SFDR. KBA’s remuneration policy is reviewed periodically or as required by regulations.
KBA understands that the management of ESG risks and the integration of ESG considerations as part of the investment process can have meaningful risk management and financial impacts and as such are factors considered when monitoring the investment activity and decision-making processes of our delegates.
KBA’s process is to understand and monitor how ESG considerations are factored into the investment process of each delegated Investment Manager to ensure that the delegated Investment Managers are managing all sources of risk and are being a good steward of the assets, they manage in line with their stated objectives and policies.
KBA is committed to promoting a sustainable environment and good corporate governance. KBA seeks to manage and enhance its environmental and social impact across its organisation and within the wider community. Details of KBA’s approach to Corporate Social Responsibility can be found on our website: https://kbassociates.ie/leadership-diversity-csr/
KBA has retained portfolio management for a small number of investment funds, whose investment strategies are primarily of a buy and hold and concentrated nature. As a result, KBA does not currently have a direct engagement policy, a voting policy or exclusionary policy in place. Details of KBA’s Shareholder engagement policy are available on our website https://kbassociates.ie/sustainable-finance-disclosures-regulation-details/
For the SFDR details of each investment fund which has appointed KBA as its UCITS Management Company or AIFM, please insert the full name of the umbrella fund into the search box below.