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ESG Approach to Private Equity

Foresight's private equity team is committed to working towards a smarter future through growing small businesses around the UK.

Underpinning our SME investing approach are five ESG Principles, which we have identified as the main areas where it is possible to evaluate, monitor and encourage portfolio companies to develop their ESG standards.

Our Five Principles for SME Investing are:

Awareness:

Does the business demonstrate a good awareness of corporate social responsibility? Is this reflected in its processes and management structure?

Environmental:

Does the company follow good practice for limiting or mitigating its environmental impact, in the context of its industry? How does it encourage the responsible use of the world’s resources?

Social Engagement:

What impact does the company have on its employees, customers and society as a whole? Is it taking steps to improve the lives of others, either directly, such as through job creation, or indirectly?

Governance:

Does the company and its leadership team demonstrate integrity and are the correct policies in place to ensure it meets its legislative and regulatory requirements?

Third Party Interactions:

Is the principle of corporate responsibility evidenced in the company’s supply chain and customers and how does it promote ESG values and share best practice?

Foresight is committed to backing female entrepreneurs, we are investing in women

Foresight is a proud signatory of the Investing in Women Code, an initiative implemented by HM Treasury to make the United Kingdom one of the most attractive countries in the world to start and grow a business by advancing female entrepreneurship.

Foresight is committed to creating an inclusive culture and advancing access to capital for female entrepreneurs; we are investing in women. Together with the HM Treasury and signatory firms, we have:

  • A nominated member of senior leadership, Partner Claire Alvarez, who is responsible for ensuring female entrepreneurs have equal access to finance
  • Committed to standardised reporting on Foresight Private Equity's investment activities and improving industry transparency in reporting
  • Committed to the shaping internal practices to improve female entrepreneurs access to funding

Find out more here. 

Our Five Principle Analysis and Monitoring Progress

The ESG progress made by a particular company is regularly monitored and a Five Principle analysis of each portfolio company, supported by quantitative and qualitative data, is undertaken prior to investment and annually throughout the life of the investment. This evaluation involves the company’s track record, current position, potential (the opportunities available), as well as the risks. The investment’s absolute ESG impact is considered alongside the potential for the company to improve its ESG record and the progress it makes with targeted improvements.

In addition to our Five Principles framework, we apply an outcome focused approach. This helps us understand, measure and track the positive impacts that our companies have on society and the environment. To do this, we have identified four impact themes, aligned with the Sustainable Development Goals, which we use to evaluate both new and existing investments. These themes help us assess opportunities for our investee companies and the broader impact they can have on the society and the environment. More information on these can be found by clicking on the below.

Quality Employment at Scale

Foresight invests in small, growing businesses that are vital to a healthy economy. SMEs are the largest provider of employment, accounting for 61% of all jobs in the UK’s private sector. By helping small business owners with their growth ambitions, to date Foresight has supported the creation of nearly 600 jobs in the North West alone. We recognise that every employee at our portfolio companies is a strategic asset and we work with our management teams to foster inclusive and engaged workplaces.

SDG Alignment 8

Health

In addition to supporting companies that supply the pharmaceutical industry and help maintain NHS equipment, we have invested in companies that promote mental health and other wellbeing initiatives. During the COVID-19 pandemic, the health and safety of all employees has been paramount and we have worked with our management teams to provide COVID secure workplaces and support the wellbeing of staff. We also encourage all of our portfolio companies to provide workplace benefits covering a range of areas including medical cover and cycle to work schemes.

SDG Alignment 3

Research and Innovation

Research and development play a crucial role in the innovation process. They can lead to improvements to existing processes and increase efficiency as well as the creation of new products and services.  By investing in innovative SMEs we are supporting companies that stand ahead of their competitors, creating new jobs and driving change.

SDG Alignment 9

Sustainable, Inclusive, Local Infrastructure and the Environment

We believe that to deliver sustainable and inclusive growth, we must support quality, reliable and resilient companies focused on developing local infrastructure and the environment. We have invested in a broad range of companies including those that are improving housing facilities in disadvantaged areas and those that are focused on improving connectivity and transport infrastructure. Our portfolio companies are encouraged to engage with their employees and communities with the objective of having a positive effect on the environment and developing local infrastructure.

SDG Alignment 9, 11, 15