Our investments focus on a sustainable future
Principal adverse sustainability impacts statement
Verso creates international growth companies by investing in businesses that are not currently living up to their full potential. We are an active investor and are committed also to actively promoting responsible business management in our portfolio companies through board work and active collaboration with company management. We follow the same responsible management principles also in our own work and they are reflected in our core values of: Reliability, transparency and integrity.
Verso is committed to follow and actively promote best Environmental, Social and Governance (ESG) practices, and adheres to the guidelines and principles promoted by Invest Europe and Finnish Venture Capital Association. The Verso ESG principles are:
- ESG related aspects are always taken into account and included in our analysis of investment prospects, and in investment decision making
- By being an active owner we promote the best ESG practices in our portfolio companies
- We require our portfolio companies to include ESG in their regular reports
- We actively promote, and collaborate with others to improve the fulfillment of ESG practises in the industry
Verso has appointed Partner, Compliance Manager Mika Suomela as responsible for ESG topics to ensure coordination of actions both internally and with portfolio companies, and constant review and improvement of ESG policies and processes.
Integration of sustainability risk in our investment decision-making process
We regularly review our ESG policy to ensure we take the principles into account in every stage of the investment process; when evaluating investment leads and prospects, in Due Diligence analysis and when making investment decisions.
When evaluating investment leads and prospects, Verso actively searches companies taking sustainable development as key principle and focuses investments into segments providing positive ESG impacts like circular economy, health and well-being, clean energy, industry innovation, sustainability and climate action.
Verso avoids investing in companies working in certain industries or business segments having questionable environmental, social, ethical or moral impacts. In Due Diligence we use reputable external advisors, to check potential issues with environmental, social or governance related areas. Any negative findings in these areas will be carefully scrutinized and a mitigation plan will be defined and agreed before potential investment decison. The findings may also cause us to withdraw from the investment. The Investment Decision includes the summary of due diligence analysis with potential ESG findings to mitigate ESG risks and utilize positive ESG opportunities.
Verso is an active owner with a target to grow the portfolio companies by 2 to 5 times during our ownership and ensuring the long term development capability of the companies even after our exit. We believe companies having positive ESG impacts as a key principle will have a long-term benefit in their value creation.
ESG principles are actively followed in the development of the portfolio companies, and we require the companies to practice modern good corporate governance principles and transparency in their operations. The boards of the companies are required to regularly review ESG status against agreed KPI’s, including potential findings from the due diligence.
Verso regularly follows the development of the portfolio companies, including ESG topics, and reports the development of the portfolio and individual companies to LP’s and authorities according to the relevant contracts, directives, law, accounting rules, other statutory obligations and Invest Europe principles.
Responsibility in daily work
Verso promotes equality, diversity and responsibility in the daily work of its own directors and employees, and of the directors and employees of its portfolio companies. We do not allow discrimination or abuse for any reason and embrace diversity. We require full transparency and integrity in every aspect, and strongly believe that following best ESG principles not only makes the world a better place but also provides better financial returns in the long run.
No consideration of sustainability adverse impacts
For the time being, Verso Capital Oy does not consider adverse impacts of investment decisions on sustainability factors as meant in Article 4(1) of the EU Regulation 2019/2088 on sustainability-related disclosures in the financial services sector (“SFDR”) due to the following reasons:
The more detailed requirements relating to the consideration of adverse impacts of investment decisions on sustainability factors are still unclear due to the related regulatory technical standards being still in draft form. There is also little official guidance on the topic.
Due to the foregoing, there is also uncertainty as to whether the adverse impacts can be measured as required by (the still evolving) regulation. Considering that the portfolios of the managed funds consist of a number of investments in unlisted companies, it is also not certain whether sufficient data can be obtained with respect to each portfolio company.
Verso Capital Oy believes that considering inter alia the scale of its operations and the business sectors of its portfolio companies, adverse impacts, if measurable, are likely not to be material.
We will evaluate and update our position accordingly when the regulatory technical standards outlining the content and definitions regarding measuring, considering and reporting adverse impacts on sustainability factors have been finalised.