Our investment philosophy is to seek value-based opportunities with a focus on risk mitigation and management via our institutional-grade risk management, governance and operations.
In line with this philosophy, considering environmental, social and governance (ESG) factors has become increasingly relevant for our leadership, employees and investors.
We believe that embedding ESG considerations into our governance, culture and investing approaches will support better performance and play a role in our sustainable growth and success.
In 2019, we established a Sustainability Steering Committee (SSC) from key parts of the business, and engaged a sustainability consultant to help us develop our sustainability framework and priorities which have been incorporated in our new Sustainability Policy.
We recently became a signatory to the Principles for Responsible Investment, which includes a commitment to the following Principles:
Principle 1: We will incorporate ESG issues into investment analysis and decision-making processes.
Principle 2: We will be active owners and incorporate ESG issues into our ownership policies and practices.
Principle 3: We will seek appropriate disclosure on ESG issues by the entities in which we invest.
Principle 4: We will promote acceptance and implementation of the Principles within the investment industry.
Principle 5: We will work together to enhance our effectiveness in implementing the Principles.
Principle 6: We will each report on our activities and progress towards implementing the Principles.
Sustainability beliefs and priorities
The following framework highlights our sustainability approach and priority areas for 2020.
Sustainability governance and oversight
Our approach to ESG and investments
Qualitas does not make investments or support sponsors or borrowers that operate in the following sectors:
- Production and/or sale of military equipment, firearms or ammunition
- Production, storage and/or transportation of nuclear/radioactive material (this does not apply to medical equipment or quality control measurement equipment)
- Production and/or sale of tobacco products (where it is the primary line of business)
- Adult entertainment venues, brothels and sale of pornography
We are committed to factoring ESG considerations into our investment due diligence and decision-making. From mid-2020, all potential investments across debt and equity will include an ESG assessment of the sponsor/borrower undertaken by our investment due diligence team. Leveraging relevant aspects of the international GRESB Real Estate Assessment, our proprietary assessment will explore and document key ESG areas and leadership. All investment papers will include a dedicated ESG section, which will form part of our decision-making process.
We are committed to integrating ESG factors across our organisation. This includes ongoing efforts to build internal sustainability capability via relevant training for staff. We have introduced initiatives to support a culture of diversity and inclusion, and build deeper community engagement in relation to homelessness and affordable housing. We are also continuing to reduce our carbon footprint and office waste.
Principles for Responsible Investment
We are keen to learn and collaborate with others to enable real property climate change action. In 2020, we became a signatory to the Principles for Responsible Investment (PRI) and are exploring further engagement with key climate change initiatives.
Internal reporting will be managed by the Chair of the SSC. Reporting to the Board will occur at least twice per year, and to the Executive Team at least quarterly. Reporting to key stakeholders and investors will occur via ongoing communication channels. PRI reporting will occur as per membership requirements.
The Chair of the SSC is responsible for communicating the contents of the policy and advising the Executive Team of any breaches of the policy, which will be recorded in the incidents and breaches register maintained by the Director – Group Compliance.
The policy will be reviewed annually, and more frequently if appropriate. The Chair of the SSC is responsible for the review, and any changes to policy will be provided to the Board for approval.