Frøya Ventures Fund Manager Disclosures
In line with the Sustainable Finance Disclosure Regulations (SFDR)
Sustainability disclosures at entity level pursuant to SFDR
At Frøya Ventures AS (“Frøya” or “we“) we aim to make investments that contribute to the empowerment of women while also creating superior risk-adjusted returns for our investors. We believe that ensuring gender equality in start-up investments will reduce risk and contribute to better results for the investors.
The EU has adopted legally binding measures on sustainable finance applicable to alternative investment fund managers such as Frøya. These measures include Regulation (EU) 2019/2088 on sustainability-related disclosures in the financial services sector (the “SFDR“), applicable in both the EU and Norway.
The below paragraphs provide specific information required under the SFDR about Frøya’s policies on integration of sustainability risks in its investment decisions, whether principal adverse impacts of Frøya’s investment decisions are considered and how Frøya’s remuneration policies are consistent with the integration of sustainability risks.
Transparency of sustainability risk policies under SFDR Article 3
SFDR Article 3 requires fund managers such as Frøya to publish on their websites information about their policies on the integration of sustainability risks in their investment decision-making process.
Sustainability risks are defined in the SFDR as environmental, social or governance events or conditions that, if they occur, could cause an actual or a potential material negative impact on the value of the investment.
The assessment of sustainability risks form part of our due diligence process when screening for potential investments. We acknowledge the fact that all investments to some degree are exposed to sustainability risks, and we assess the likely impacts of the sustainability risks on the returns of the investment. If we deem the potential investment’s vulnerabilities to sustainability risk to be unmanageable, we will refrain from making the investment.
No consideration of principal adverse impacts under SFDR article 4
SFDR article 4 requires financial market participants such as Frøya to publish and maintain on their websites information on whether they consider principal adverse impacts of investment decisions on sustainability factors and, if they do not consider principal adverse impacts, clear reasons why, including, where relevant, information as to whether and when they intend to do so.
Sustainability factors are environmental, social and employee matters, respect for human rights, anti-corruption and anti-bribery matters, and principal adverse impacts are the most significant negative impacts of investment decisions on these factors.
Frøya does at this time not consider principal adverse impacts of its investment decisions on sustainability factors.
In this decision, we have taken into consideration the nature and scale of our activities. Our view is that the activities of early-phase companies within our selected investment themes generally have a low principal adverse impact on sustainability factors. Therefore, we believe that our resources are better allocated to other areas, such as ongoing interaction with the management our portfolio companies to improve their sustainability profile, especially in relation to gender equality, and improve their value creation through such engagement.
We will however, especially in parallel with the scaling of the companies’ activities, keep our decision not to consider principal adverse impacts under SFDR article 4 under regular review, and may revaluate the decision at a later stage.
Transparency of remuneration policies in relation to the integration of sustainability risks (SFDR Article 5)
SFDR article 5 requires financial market participants such as Frøya to publish on their website information on how their remuneration policies are consistent with the integration of sustainability risks.
As the value of Frøya’s assets under management are below certain thresholds set out in the Alternative Investments Fund Managers Act, Frøya is not required to adopt a remuneration policy. Frøya has therefore not adopted a remuneration policy, but will ensure that any future remuneration policies are consistent with Frøya’s integration of sustainability risks as outlined above.
