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Phi’s ESG Policy

PHI believes in building sustainable business and creating long term shareholder value through operational partnership. PHI follows a sector agnostic approach through implementing principles of responsible investing. PHI commits to integrate ESG risk identification and management into the overall investment strategy and decision- making process and be ESG compliant across the portfolio investments. The ESG commitments will be implemented through a comprehensive ESMS to ensure continual improvement.

PHI’s ESG Commitments

In line with its commitments, PHI has established a comprehensive ESG Policy committing to uphold globally- accepted ESG standards and practices by means of:

  • Compliance with all applicable local, national ESG legislations, and reference frameworks such as IFC Performance Standards, BII Code of Responsible Investing, DEG E&S Policy and other frameworks, as applicable.
  • Adhere to the highest standards of ethical conduct of its business operations and integrate ESG factors throughout the investment cycle from selection of investment, due diligence process and engagement with portfolio companies such as periodic monitoring, oversight, value addition and technical assistance. Exclude from financing business activities that do not meet the investors’ Exclusion List and PHIs’ principles.
  • Evaluate all E&S risks and impacts and identify E&S opportunities associated with the portfolio company’s operations (including their supply chain) and integrate the same in the investment review and decision-making process to ensure E&S considerations are addressed consistently across all investments. Encourage the development of ESG Policy for all portfolio companies (if not in place) and provide support and guidance to establish a comprehensive management system to identify E&S risks and manage the same on an ongoing basis in line with agreed ESG terms & conditions.
  • Ensure management and mitigation of any identified E&S risks/ impacts through implementation of effective and responsible management processes and preventive measures.
  • Promote adoption of E&S safeguards, sustainable use of natural resources, reduction of GHG emissions which contribute to climate change, efficient waste management procedures, implementation of resource efficiency and pollution prevention measures.
  • Promote compliance w.r.t social and employee welfare related regulations (as applicable) such as payment of wages; benefits; overtime; prohibition of child & forced labour; freedom of association and collective bargaining; at Fund and Portfolio levels.
  • Apply the principles of fair labour and working conditions, non-discrimination and equal opportunity for employees and contractors on PHI and its Portfolio Companies in terms of recruitment, progression, terms and conditions of work and representation, on the basis of gender, race, colour, caste, disability, political opinion, sexual orientation, age, religion, social or ethnic origin, marital status, HIV status etc. Ensure and encourage responsible stakeholder engagement at Fund and Portfolio levels and assure implementation of applicable ESG compliance requirements throughout engagement with different stakeholders. Maintain transparency about the investment process to concerned stakeholders.
  • Establish a fair and transparent Grievance Redressal Mechanism to be made available to all the relevant stakeholders.
  • Exhibit honesty, integrity, fairness, diligence and respect in all business dealings by adhering to, and requiring Portfolio Companies to adhere to the principles of good corporate governance and integrity standards.
  • Monitor and evaluate ESG performance of the portfolios through set Key Performance Indicators and report the overall ESG performance of PHI and individual portfolios to investors.
  • Put in place an organizational structure, roles and responsibilities and additional resources to implement this ESG Policy Statement at Fund level.
  • Adopt and implement policies to prevent extortion, bribery, fraud, corruption and financial crime. Properly record, report and review financial and tax information.
  • Exhibit honesty, integrity, fairness, diligence and respect in all business dealings by adhering to, and requiring Portfolio Companies to adhere to the principles of good corporate governance and integrity standards.

Roles & Responsibilities

PHI will maintain E&S capacity at all times in the form of internal competency/ external competent consultant with the oversight from the senior management. PHI has the following roles & responsibilities under the ESG Policy:

  • Monitoring and evaluating the portfolio companies. Every portfolio company of PHI will report on the ESG Performance on annual basis, highlighting the portfolio’s KPIs.
  • Annually monitor the effectiveness and implementation of PHI’s ESG Policy.
  • Annually report to investors and stakeholders on the ESG Performance of their investments. Periodically revise, update and strengthen its ESG Policy and all its elements in line with nature of its investments and applicable regulations in the country, by periodically consulting concerned stakeholders.
  • Disclose relevant information related to ESG aspects and corresponding strategies formulated, E&S performance of every portfolio subject to investment agreement conditions, communication mechanism to address enquiries, feedback and grievances of various stakeholders.

Communication

PHI will communicate the ESG policy to all employees and other stakeholders and provide training and resources to ensure its effective implementation.