ESG report 2024

Before investing in a new fund – a primary investment – an ESG Due Diligence (ESG-DD) is conducted. This is an analysis of, among other things, the manager's investment guidelines, ethical guidelines, and ESG-related working practices. In addition to gathering information, Argentum have a dialogue with the manager about how they themselves gather relevant information before making investments in a portfolio company, as well as how this is followed up and reported during the ownership period. Argentum also include questions about ESG in the reference checks conducted by the managers. Findings and assessments from ESG-DD are presented in a separate section in the investment recommendation.

In addition to ESG-DD, Argentum has set up a standard agreement in the form of a side letter that all managers must agree to before committing capital² to a new fund. The side letter has a separate section for ESG. This includes, among other things, that the managers accept:

• That Argentum's investment activities are based on the principles of the UN Global Compact and UN PRI.
• That they have received Argentum's ethical guidelines and are encouraged to develop similar guidelines.
• To consider the social, environmental, and ethical consequences of current and planned investments.
• To report annually on ESG to Argentum.

Investment restrictions are also part of the agreement, and Argentum does not invest in funds that do not accept these.

For Secondary investments³, Argentum assesses the manager's ESG policy, investment restrictions, investment strategy, and underlying portfolio before making an investment decision. Because Argentum does not have influence over the existing agreement, as the fund is already established, a thorough process is necessary to assess the fund's existing portfolio.

Argentum is committed to forming a good impression of the manager's ESG work, and this process is more comprehensive if it involves a manager Argentum is not familiar with. The manager is followed up annually in the same way as for our primary investments. All investments are followed up in our annual ESG survey, including co-investments.

In 2024, Argentum committed capital to ten new funds in the primary portfolio: Main Capital VIII, Holland Capital Growth and Buy Out Fund V, Vortex Capital Partners Fund IV, Ansor Fund II and six other funds.

In total, Argentum has committed 798 million NOK to these funds, and all managers have accepted our side letter. They have committed to annual reporting on their ESG work to Argentum or have their own ESG routines that cover our reporting satisfactorily. Four of the managers are new to Argentum’s portfolio.