Catalysing transformation beyond capital
We acknowledge our responsibility as a majority investor. We see this position as an ideal platform to promote and progress the sustainability agenda as a contributor to solid financial returns.
At CataCap, we actively promote responsible behaviour and sustainability as an integral part of our value creation. We employ the catalyst approach to value creation in our portfolio companies. We do this by setting standards and minimum requirements and help facilitate sustainability initiatives fostered in our portfolio companies to ensure that such initiatives are relevant to the company and society, embraced by the staff and fully embedded in the management processes.
Our portfolio companies are all part of local communities and the world around us, and we know that good leadership and financial growth go hand in hand with sustainable and responsible behaviour. That’s why we acknowledge the link between strengthening our companies’ performance in aspects concerning environment, social and governance (ESG) and the creation of financial returns, competitiveness, and long-term value creation of the businesses.
Because it’s not just about doing good. It’s doing good business.
Stories from our portfolio
Company
Sector
Aviation aftermarked
Company
Sector
Food & beverage
Our ESG approach
We apply a systematic, hands-on approach to value creation that integrates ESG throughout the investment lifecycle. Our Responsible Investment Policy and ESG Framework guide this work and ensure that ESG is considered in a structured and consistent way across all our investments.
Since 2021, we have also been a signatory to the UN-supported Principles for Responsible Investment (PRI). As an active owner, we invest to be the catalyst of positive transformation of businesses from within. Our systematic operational approach create value for businesses, people and investors that last beyond our time as owners.
Read our Responsible Investment Policy here.
Acquisition
1
Initial
Identification of potential red flags, e.g., risk of stranded assets. Guide ESG due diligence focus and efforts.
2
Due diligence
Due diligence dives deeper on results of initial screening. Including assesing ESG exposure and maturity of case as well as identifying potential focus areas for ownership, i.e., potential ESG risks and opportunities.
Ownership
3
ESG Toolbox
Findings during due diligence act as first assesment of ESG maturity and exposure. This feeds into development plan for the first months of ownership.
ESG toolbox used to develop ESG performance as part of overall value creation approach.
4
Portfolio company reporting
Setting ESG ambitions and reporting on progress is part of ESG toolbox. This includes annual reporting of portfolio companies’ ESG efforts & KPI’s to CataCap and outer relevant stakeholers as part of ESG toolbox
Exit
5
Documentation of ESG efforts
Documentation of portfilio ESG initiatives (activity, progress, and impact) to showcase incremental value add as well as performance trajectory.
Integrating ESG into all investment decisions
In the acquisition phase, ESG factors are a core element of our investment analysis and decision-making. We evaluate the target company’s ESG efforts and performance, with findings presented to the Investment Committee as part of the final assessment.
We aim to invest in companies where we have identified an opportunity to help improve ESG performance as part of our overall value creation approach or in companies with a business model already contributing positively to the ESG agenda.
During the ownership phase, we apply an integrated, hands-on approach to unlock ESG potential and drive continuous improvement, working shoulder-to-shoulder with management teams. Throughout, we ensure that progress and results are well-documented for future owners as well as for our fund investors.
Supporting our portfolio companies
We aim to empower and support our portfolio companies to actively work on improving diversity and ESG performance as part of our overall long-term value creation approach. Further, we seek to support initiatives fostered in our portfolio companies. This also includes organizational and leadership development focusing on enhancing organizational health, as well as the formulation of a development plan for each portfolio company aimed at integrating ESG issues relevant to the specific industry or company.
To ensure a strong foundation, every portfolio company is required to meet CataCap’s ESG minimum requirements within the first year of ownership. These include working with at least three company-specific ESG KPIs, measuring and reducing greenhouse gas emissions in alignment with the GHG Protocol, ensuring board and management diversity, joining the UN Global Compact and reporting annually, implementing a code of conduct, and actively strengthening organizational development and employee engagement.
We acknowledge that errors and mistakes may happen – also when working with aspects concerning environment, social and governance. To us, the important part is how you correct them and embrace the learning opportunity. We believe that errors and mistakes provide valuable input, and we consider it crucial to learn from possible errors and mistakes as part of our value creation.
ESG governance and reporting
Our Investment Team is responsible for integrating ESG into the investment process, while the Investment Committee oversees ESG findings as part of all final investment decisions. The Board of Directors reviews and approves our Responsible Investment Policy on an annual basis.
We report semi-annually to investors on ESG performance across our funds, including company-specific KPIs, and submit annual reports to the PRI. All portfolio companies are required to report annually on ESG progress and, as members of the UN Global Compact, publish a Communication on Progress (COP).
Value-creation beyond our time as owners
We care about societal impact. And we know investors do too. Our systematic operational approach for value creation catalyses growth and creates value for our portfolio companies that endure beyond our time as owners. We have a clear ambition that by the end of our investment lifecycle, our portfolio companies will have developed and improved on ESG performance.
Documenting this journey is important, which is why progress on ESG is tracked and shared with our investors throughout our ownership.
Our commitments
CataCap is a licensing organisation of the SASB Standards, which is applied as part of our ESG Framework.
We are also a proud signatory of Principles for Responsible Investment (PRI) and are committed to the principles of the United Nations Global Compact and our portfolio companies are – or will become – members of United Nations Global Compact.
CataCap is also a member of Active Owners Denmark (formerly DVCA) and complies with existing ethical guidelines for responsible ownership.
Sustainability-related disclosures
You can read about our compliance with SFDR here