At Horizon Capital, we believe that investing responsibly aligns us with the objectives of our investors, benefits our partners and portfolio companies that we back, and the communities that we live and operate in. Doing good is also good business as we believe that high standards of Environmental, Social and Governance (“ESG”) result in a positive impact on the financial and operational performance of our investment portfolio.

ESG has been central to Horizon Capital’s DNA since we launched the firm in 2006. We have benefited greatly by the backing and support in adopting best-in-class ESG at Horizon Capital from international financial institutions and impact investors who back us, with their wealth of expertise and know-how, including the European Bank for Reconstruction and Development (“EBRD”), the International Finance Corporation (“IFC”), Dutch Entrepreneurial Development Bank (“FMO”), Deutsche Investitions- und Entwicklungsgesellschaft (“DEG”) and a subsidiary of KfW Group, Société de Promotion et de Participation pour la Coopération Économique (“Proparco”), the Swiss Investment Fund for Emerging Markets (“SIFEM”), Investment Fund for Developing Countries (“IFU”), the Western NIS Enterprise Fund, and the Zero Gap Fund, an impact investing collaboration between The Rockefeller Foundation and the John D. and Catherine T. MacArthur Foundation.

The high standards of our global institutional investor base, with a capital base of nearly $600 billion, motivate, inspire, and support Horizon Capital in our role as an ESG standard-bearer in our Region. Horizon Capital is a proud signatory to the United Nations Principles for Responsible Investment (UNPRI), whose principles we share and have furthered in our investment operations. We do so by taking a systematic approach to risk assessment and Environmental and Social (E&S) management through the application of IFC Performance Standards on Environmental and Social Sustainability (IFC Performance Standards), and the Environmental, Health and Safety (EHS) Guidelines. The established Environmental and Social Management System (ESMS) is detailed in each fund’s Investment Policies and Procedures, including relevant Environmental and Social Policies and Procedures and incorporates E&S issues into the investment decision-making process. Funds under management include relevant E&S Covenants, which are integral elements of each Fund’s Limited Partnership Agreement.

Horizon Capital pays particular attention to ESG issues from the very beginning of a new partnership, incorporating a thorough evaluation of such issues in conducting due diligence of prospective investment opportunities, and during the life cycle of our investments. We identify gaps between ESG requirements and best practices during this evaluation stage, and post-investment, incorporate suggested improvements into action plans for implementation by portfolio company management, supporting this process with templates, best-practices shares and ongoing consultation.

Corporate governance is a crucial component of ESG. Horizon Capital focuses extensively on establishing effective corporate governance mechanisms together with each  investee, negotiating key elements prior to entering the investment and ensuring strong corporate governance . rights post-investment.

Horizon Capital has also implemented a strong Integrity and Anti-Corruption Compliance System at the firm, incorporating EBRD Integrity Guidelines to identify and manage integrity and anti-corruption compliance risks with respect to firm operations, operations of funds under management, and supporting the implementation at the investee level led by portfolio company management.

We work closely with portfolio companies to implement improvements, providing our partners with guidance and assistance as they strive to raise standards within the portfolio, and provide annual as well as ad-hoc comprehensive firm and portfolio company E&S reporting to our esteemed investors.