Certior Capital is highly committed to responsible business practices and good corporate governance. As a European firm with strong Finnish roots, transparency, honesty, and humility are fundamental to our corporate culture and team ethos. We fully integrate sustainability aspects into our own operations and use our influence to encourage our business partners across Europe to uphold the highest standards.
We firmly believe that ESG factors play a crucial role in determining risk and return and view their integration as a vital part of our fiduciary duty to our clients. To ensure our alignment to sustainable investing, we have been a PRI signatory since 2018. In 2021 Certior Capital became a signatory of Initiative Climat International (iCI). Joining iCI, we will join forces to contribute to the objective of The Paris Agreement to limit global warming to well-below two degrees celsius.
Indicating Certior’s commitment to the Paris Agreement goals, we have committed to net-zero emissions in our portfolios by 2035. To reach this target we closely monitor the greenhouse gas emissions of our investees. We engage with investees where needed to improve their performance on this issue. Beyond GHG emissions, and environmental issues in general, our commitment includes the social responsibilities of investees as well. On social issues we prioritize equality and equal opportunities throughout the investment period, ensuring that these values are integrated into everything we do.
How Certior Capital considers sustainability in investing
Certior Capital’s ESG policy describes how we integrate sustainability into our investment decision-making process. In practice, we promote environmental and social characteristics by investing in funds and co-investments that not only meet our financial criteria but also mitigate negative environmental and social impacts through their operations, products and services.
Certior actively supports our investees in mitigating negative environmental, social, and governance impacts stemming from their operations. On social and governance issues we are guided by the UN Global Compact and OECD Guidelines on Multinational Enterprises. We expect our investees to adhere to these minimum safeguards.
For our latest fund vintages we monitor our investees’ progress on environmental and/or social characteristics through our annual ESG survey. The results of these surveys, progress in environmental or social issues and any possible breaches of minimum safeguards are disclosed in our annual ESG report.
Promotion of environmental or social characteristics in Certior Capital’s investments
Certior promotes environmental or social characteristics in all new investment decisions by investing in funds and co-investments which, in addition to other criteria, mitigate environmental or social adverse impacts due to their own operations, products and services. This commitment is a core part of our fiduciary duty and aligns with our goal of achieving net-zero emissions by 2035.
It’s important to note that this focus on environmental and social issues applies to funds with an open investment period. For older vintage Certior funds, where the investment period has ended and environmental or social characteristics were not promoted during the investment period, we do not collect sustainability data to assess or measure impact.
CPEF III
Our latest fund, Certior Private Equity Fund III, is classified as an Article 8 fund.
The fund promotes environmental or social characteristics by investing in funds and direct co-investments which, in addition to other criteria, mitigate environmental or social adverse impacts due to their own operations or through their products and/or services.
The fund does not commit to have a specific minimum share of sustainable investments in the portfolio.
All other Certior funds
All other Certior funds are classified as Article 6 funds.
These funds are not committed to having a certain minimum share of sustainable investments in their portfolios. For those funds that are open to new investments, any new investments follow our ESG policy. For closed funds, we monitor investees and engage with them on any breaches or incidents.
Certior Capital’s Updated ESG Policy
Certior Capital began enhancing responsible investment practices during 2023 following the recruitment of a fulltime ESG manager. As part of this development, we fully updated our ESG policy in the Spring of 2024. In revising and expanding our ESG policy, we defined more precise guidelines for considering environmental, social, and governance factors in our investment activities. Additionally, we detailed the integration of responsible investment policies at each stage of the investment lifecycle and refined our exclusion list to better describe the economic activities we do not wish to invest in due to their greater harmful impacts or higher risk. Overall, with this update we aim to communicate more clearly to our stakeholders how our investment decisions address the greatest challenges of our time and manage the risks of harmful impacts as part of our fiduciary duty.
Please click the following link to access the new policy: Certior Capital ESG Policy Dec 2024
Measurement and Compensation of Certior Capital’s 2023 Carbon Emissions
As part of our increasing focus on sustainability and good corporate governance, Certior Capital has recently conducted its first carbon emissions calculation for its business operations during 2023. Operational carbon emissions for the period were estimated to be just under 47 tCO2e. As is typical for small asset management companies with <10 employees, Certior’s carbon emissions from its own operations are relatively low. While our investment activities do not focus on high-emission industries, our underlying investment portfolios are expected to account for the majority of Certior’s total carbon emissions. As a next step, carbon accounting for our investment portfolios will now be implemented for future publication.
The operational carbon accounting was carried out mainly using cost-based estimation. For electricity and office cooling/heating, direct consumption data from the landlord allocated to our own office space was used. The precise emission factors for electricity, office cooling/heating were collected from the utility companies. Employee flight emissions were calculated using the UNGCCC GHG emissions calculator based on flights taken during the year. Employee commuting was estimated based on the number of office days, the modes of transportation used and emission data provided by domestic operators (HSL, VR, Motiva). For other consumption, we used monetary expenses along with factors from Climatiq.
Overall, our operational emissions were modest at 47 tCO2e. These relatively low levels of emissions were achieved through the use of zero-emission electricity and cooling at our offices. The largest emissions, as expected, came from business-related travel and the use of IT-based accounting and reporting services which together accounted for about two-thirds of our operational carbon emissions.
Certior Capital’s 2023 Carbon Emissions Are Now Fully Compensated
After reviewing a number of alternative solutions, the CO2 emissions from our own operations have now been offset by planting new forests as carbon sinks. The offsetting was carried out with a slight overcompensation through an external service provider, Ilmastoapu Oy. The company started operations in 2015 and focuses on helping Finnish SMEs mitigate their carbon footprint. It will plant new forests in Finland on decommissioned peatlands, creating genuinely new carbon sinks.
Certior Capital Publishes Inaugural ESG Report Covering 2023-24
As part of its growing commitment to ESG issues, Certior Capital recently published its inaugural ESG report. The report covering the years 2023-24 represents the tangible culmination of our dedicated efforts over the past two years to significantly enhance our sustainable investment practices. A primary objective of this project was to establish the necessary capacity for comprehensive ESG data collection. While technical challenges caused some delays in completing our data surveys, we are now pleased to provide the first ESG data tables for three funds managed or advised by Certior Capital: Certior Credit Opportunities Fund II, Certior Credit Opportunities Fund III, and Certior Private Equity Fund II.
For the full report please click through the following link: Certior Capital ESG Report 2023-24
