Sustainable Finance Disclosure Regulation (Regulation (EU) 2019/2088) (“SFDR”) Disclosure

UK firms which opt into the SFDR as the delegated investment manager to an EU firm must ensure that they publish information on their websites about their sustainable risk policies (Art 3), consideration of principal adverse impacts on sustainability factors (Art 4) and remuneration policies (Art 5). In line with these requirements, Corinthia UK Management Limited (‘CUKML’) (which has opted-in with respect to the Corinthia European Direct Lending Fund Sarl has outlined its approach.

Sustainable Risk Policies

CUKML is required to publish information on its website about its policies on the integration of sustainability risks in its investment decision-making process. A sustainability risk is an environmental, social or governance event or condition that, if it occurs, could cause an actual or a potential material negative impact on the value of the investment.

For CUKML sustainability risks are risks which would cause a material negative impact on the value of the portfolios it manages. CUKML’s investment process aims to identify the material risks associated with each proposed investment before it is made, including the relevant sustainability risks.

CUKML’s investment decision-making process integrates sustainability risks alongside other key factors to ensure a comprehensive risk assessment. For example, CUKML’s investment committee evaluates identified sustainability risks in conjunction with other relevant considerations outlined in each investment proposal. The committee conducts this evaluation in alignment with the investment policies and objectives of the relevant funds.

Sustainability risks are identified and assessed using the same rigorous approach applied to other risks that may impact investments made on behalf of the funds. This ensures a consistent risk management framework that captures potential financial and non-financial risks. Furthermore, investments are subject to continuous monitoring by the investment committee, where sustainability risks remain an integral part of the ongoing assessment process, alongside other material risks.

Principal Adverse Impact Reporting

CUKML is required to disclose on its website whether it considers the adverse impacts of its investment decisions on sustainability factors in the selection of investments. Sustainability factors are environmental, social and employee matters, respect for human rights, anti-corruption and anti-bribery matters. If CUKML considers the adverse impacts of its investment decisions on sustainability factors it is required to publish information describing its policies and procedures in this regard. If CUKML does not consider the adverse impacts of investment decisions on sustainability factors it must disclose this and explain why.

CUKML does not currently consider the principal adverse impacts of investment decisions on sustainability factors because the regulatory technical standards supplementing SFDR remain in draft form and their implementation has been delayed. CUKML will keep the decision not to consider the principle adverse impacts on sustainability factors under review and re-evaluate this decision on a periodic basis.

Remuneration policy

CUKML has a remuneration policy in place that aims to promote sound and effective risk management considering relevant risks, including sustainability risks. CUKML’s staff are paid a combination of fixed remuneration and variable remuneration. Any award of variable remuneration considers the individual’s adherence with internal policies and procedures, including those that relate to the consideration of sustainability risks in the investment decision making process.