Fondita Fund Management Company acts responsibly in our business operations and fund management. This means that we, in all our operations, take environmental, social and corporate governance (ESG) issues into account.
Fondita’s commitment to ESG issues can be seen through, for example, our recycling of all paper and technology waste, our active support in the personal development and wellbeing of our employees, as well as by us paying all taxes to our home country, Finland.
The United Nations –supported Principles for Responsible Investment make up the core of Fondita’s responsible investment operations. Below is a short description of these principle as well as how they are implemented at Fondita.
United Nations - Principles for responsible investment (PRI)
In May 2010 Fondita Fund Management Company Ltd. signed the United Nations-supported Principles for Responsible Investment (PRI). Through the signing of these principles Fondita has committed itself to operate in a responsible way.
According to the principles of the UN responsibility means committing to the following: to incorporate the ESG issues as a part of the investment process to act as an active owner and shareholder and incorporate the ESG issues as a part of the ownership policy to promote the ESG reporting of the portfolio companies to promote responsible investing together with other investors to report on its business operations and on the implementation of responsible business procedures.
The signing of the United Nations –supported Principles for Responsible Investment was a natural step in Fondita’s operations. We have always been confident that operating responsibly improves the company’s financial results. Responsible companies are more successful than those who do not operate responsibly.
Fondita’s responsible investment operations
Our active portfolio management highlights quality companies with good future prospects. Sustainable development issues are a priority in our investment process. We avoid investing in companies which do not operate in accordance with international principles (UN Global Compact), as well as companies whose the activity is in conflict with our own values.
Fondita’s portfolio managers are responsible for implementing the ESG issues in the investment process. The portfolio manager takes these issues into consideration when discussing with the portfolio companies’ management, analysts and other market players. The portfolio managers also receive support from ESG assessments made by our partners and by the listed portfolio companies. If deficiencies with regard to responsible governance are discovered within a potential portfolio company it is important to investigate how the company’s management aims to correct the deficiencies as well to follow up on any promised corrective actions.
The implementation of the ESG issues within the investment process is monitored within the fund company by an employee who is not a part of the portfolio management team. This person is also responsible for the reporting of responsibility issues to the UN.
Fondita rarely participates actively in the annual shareholder meetings of the portfolio companies. Participation at the meeting is, however, not out of the question. Should the agenda of a portfolio company contain issues that are in direct conflict with the interest of the shareholders, such as, for example, responsibility issues. An example of such a situation would be suggestions presented to the annual shareholders meetings that are in conflict with the equal treatment of all shareholders.
Fondita can also participate at annual shareholder meetings together with other investors. We believe, however, that our ability to influence the operations of the portfolio companies is more effective through discussions with the companies’ management than through the annual shareholder meetings. We avoid investing in companies that do not operate responsibly.
We aspire that through our responsible business operations also influence others to operate more responsibly in the future. We also encourage other companies to strive towards that same goal.