Introduction
Creating an ESG or responsible investment policy within the KEY ESG platform allows your fund to formalise and communicate its approach to environmental, social, and governance (ESG) matters — both internally, and to LPs, regulators, and other external stakeholders. This is typically set at the fund level, distinct from any policies your individual portfolio companies may hold.
Steps to create an ESG policy
Navigate to the "Policies" section: on the left-hand menu of your fund manager platform under "IMPROVE", select "Policies".
Add policy details: enter a policy name (for example, "Responsible Investment Policy"), a description summarising your fund's key ESG commitments, and upload the policy document.
Assign policy owner and details: designate an owner within your team responsible for upkeep and implementation, select a category, and assign the responsible person or department.
Finalise and save: once all fields are complete, click "Create policy".
Key aspects to understand as a fund manager
Purpose and value: a fund-level ESG policy signals to LPs and regulators (for example, in the context of SFDR or your due diligence process) that ESG is embedded in your investment approach, not just something asked of portfolio companies after the fact.
Setting expectations for portfolio companies: your fund policy can also set out the ESG standards and reporting expectations you require of portfolio companies — for example, minimum data points to report, or escalation processes for material ESG issues. Consider referencing this policy when onboarding new portfolio companies to KEY ESG.
Distinct from portfolio company policies: your fund-level policy sits alongside, not instead of, the individual ESG policies each portfolio company may hold in their own KEY ESG portal.
Example
Policy Name: "Responsible Investment Policy"
Description: This policy outlines the fund's approach to integrating ESG considerations into investment decisions, portfolio monitoring, and engagement with portfolio companies.
Category: "Governance"
Policy Owner: "Head of ESG / Sustainability"
Conclusion
A well-structured fund-level ESG policy is an essential step towards aligning your investment strategy with long-term sustainability goals, and towards setting clear expectations for your portfolio. Using the KEY ESG platform, you can easily establish and formalise this commitment for your team, your LPs, and your portfolio companies.
If you need further assistance or have any questions, our team is here to help. Reach out via the in-platform chat function or email support@keyesg.com.