ESG integration
Application at Sienna Private Credit
Our DNA is focused on action towards the real economy and impact. This naturally leads us to favor approaches and themes more related to ‘greatest improvement’ rather than ‘best practice’: it invites us to direct our efforts towards investments with significant impact rather than simply taking established best practice into account.
We have therefore adhered to the Institut de la Finance Durable‘s definition of impact, signed the corresponding impact charter and are a member of industry working groups on this theme. Our approach is based on the 3 pillars of intentionality, additionality and measurability.
Taking ESG into account in the decision-making process
Exclusion policies
As part of its ESG integration policy, Sienna’s private debt expertise has been implementing an exclusion policy for several years. Sienna acts in accordance with applicable national and international laws, prohibitions, treaties, and embargoes in defining its investment universe. In addition to these legal requirements, Sienna also takes into account sectoral and normative exclusion criteria concerning, for example, human rights, tobacco, nonconventional fossil fuels or coal exposure. The exclusion policy describes the conditions under which these exclusions apply.
Our Exclusion Policy
Controversy policies
As part of its ESG integration policy, Sienna’s private debt aims to implement robust processes for identifying ESG controversies and potential ESG risks, right from the preinvestment phase for direct lending funds (excluding granular portfolios). For this purpose, in 2022, it called on Ethifinance and its controversy identification and scoring tool. Data is collected over several years and on a variety of documents using the SESAMm tool. This data is then analyzed to characterize the seriousness of any controversies on a scale from 0 to 5. This formalized process produces a solid result that is taken into account when debtors are examined by the Investment Committees.
Governance
The Supervisory Board has set up:
- A Remuneration Committee with 50% independent members and 50% women, including the Chair person
- A Strategy Committee with 50% independent members and 50% women
- An ESG Committee with 66% women members, including the Chair person
The Management Board has appointed a CSR manager and an ESG manager among its 4 members, demonstrating its involvement at the highest level of corporate governance
Climate
Our commitment to climate action is embedded in our core values and throughout our investment processes reflecting our belief in a sustainable and a more environmentally responsible future.
Sienna’s private debt expertise applies the recommendations of the Task Force on Climate Related Financial Disclosure (TCFD) and is also preparing to submit its trajectory to the Science Based Targets Initiative (SBTi) for formal validation in by end 2024.
Biodiversity
Sienna defines biodiversity as the diversity between species, within species and ecosystems and their interactions.
With regard to biodiversity, Sienna’s private debt expertise is progressively implementing a method for analyzing impacts and dependencies on biodiversity, as well as a quantitative analysis of the biodiversity «proxies» of the companies it finances.
DE&I
We wholeheartedly believe in the principles of Diversity, Equity, & Inclusion, which are at the core of our values and drive our commitment to a more inclusive economy.