Genstar Capital believes that responsible corporate behavior with respect to environmental, social and governance (ESG) factors can mitigate risk and have a positive influence on long-term financial performance.

To the extent consistent with our fiduciary duties, our fund private placement memoranda and our limited partnership agreements with our investors, we take ESG factors into account as part of our investment analysis and ongoing portfolio company management.  We are a member of the United Nations-supported Principles for Responsible Investment.  We also adhere to the Guidelines for Responsible Investment developed by the Private Equity Growth Capital Council.  Furthermore, we take into account to the extent applicable the UN Guiding Principles on Business and Human Rights and the UN Sustainable Development Goals.

Investment; Ongoing Portfolio Company Monitoring and Engagement

We consider ESG factors as part of our investment process, as well as during our ongoing monitoring of and engagement with portfolio companies.  Recognizing that the relative importance of ESG factors vary across industries, geography and time, our consideration of ESG factors is tailored to the particular investment.  Our focus is on ESG issues that are, or could become, material to long-term financial performance, including as applicable salient human rights risks.

Genstar seeks to identify relevant ESG risks and opportunities as part of the due diligence process for each portfolio company acquisition.  Our due diligence takes into account, to the extent applicable, information from the target company, third party information and data, third party standards and guidance and stakeholder engagement.  Our internal investment professionals are supported by third party consultants to the extent relevant to the particular investment.  During the due diligence process, the investment team, together with our compliance personnel, identify opportunities where policy development and/or implementation of ESG initiatives would add material value to the portfolio company.  At the conclusion of the due diligence process, any material findings will be incorporated as part of the final reporting by our deal professionals to the Investment Committee.

Genstar’s commitment to responsible investment does not end upon acquisition.  We have a formal ongoing management and monitoring program to mitigate ESG risks and invest in ESG opportunities throughout our ownership period.  As part of this program, we follow up on risks identified in due diligence.  Genstar’s commitment to responsible investment is communicated to the Boards of Directors and senior leadership of portfolio companies – including by providing them with a copy of this policy – and portfolio companies are encouraged to adopt appropriate policies and programs relating to relevant ESG matters.  Portfolio companies also are periodically required to provide us with information on their ESG initiatives.  In addition, we seek to be accessible to relevant stakeholders and will consider engagement with relevant stakeholders as appropriate.

Investor Relations & Reporting

Genstar is dedicated to transparency in the reporting to our investors of our ESG policy, its implementation and results.  We value the ESG-related experience and expertise of our investors and will engage with them and solicit feedback so we may better align our responsible investing goals with theirs.  To that end, we will make periodic progress reports to our investors of efforts related to our ESG policy objectives, significant milestones that have been achieved and our goals for the future.

Ongoing Program Monitoring and Management

This policy and Genstar’s ESG program are monitored by our ESG Committee, and our ESG initiatives are led by senior Genstar compliance personnel.  The ESG Committee includes senior investment, management and compliance personnel.  The ESG Committee will at least annually review this policy and the effectiveness of our related procedures, and will recommend modifications as it determines to be appropriate.

This policy will be attested to by all Genstar employees.  Training on the implementation of this policy also will periodically be provided to relevant Genstar personnel.

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