DACH Value

In accordance with Article 8 of the SFDR, the fund aims to promote a combination of environmental and social characteristics, and the companies in which it invests must follow good governance practices. To promote and monitor these objectives, the fund uses sustainability assessments maintained by external providers to evaluate sustainability risks and sustainability factors related to its investments. The fund seeks to achieve clearly higher returns than funds with broader diversification.

Sustainable Investment Objective

The financial product promotes environmental or social characteristics, but does not make sustainable investments.

Environmental or Social Characteristics of the Financial Product

This financial product promotes environmental and social characteristics. The companies in which the fund invests must follow good governance practices.

To promote and monitor these objectives, Proprius uses exclusion criteria, the consideration of sustainability factors, active ownership and engagement. We always seek to gain as complete an understanding as possible of the social and environmental impacts of our investments, and to engage in dialogue with companies based on these observations.

The good governance practices of investee companies are analysed before an investment is made and monitored during the holding period for any deficiencies.

Investment Strategy

The fund invests its assets in securities of listed companies located in German-speaking Europe, applying a value-oriented investment style.

ESG characteristics are incorporated into the fund’s strategy by taking PAI indicators into account when making investment decisions, as well as the company-specific net impact calculated by Upright. In addition, the fund’s overall net impact, as calculated by Upright, forms part of the investment process.

Proportion of Investments

At least 50% of the fund’s net assets are expected to be allocated to investments that are aligned with the environmental or social characteristics promoted by the fund.

Monitoring of Environmental or Social Characteristics

In its investment activities, Proprius Partners Oy’s portfolio management primarily uses Upright’s impact assessments, which provide an estimate of the investee company’s impact on the environment and society.

The net impact assessment provides a score across four different dimensions, which are combined to form the company’s overall net impact score. In addition, the fund uses climate and other environmental indicators, as well as social indicators, to measure the attainment of environmental or social characteristics to the extent that relevant information is available directly from the investee companies themselves.

Methodologies

Sector- and Values-Based Exclusions

The purpose of exclusions is to limit investment exposure to certain sectors or activities that may be considered harmful to the environment and/or society more broadly. In the sector assessment, a company’s involvement in a given activity is evaluated using revenue derived from that activity as the relevant measure. Sector exclusions are based on the data and methodologies of the data providers selected by Proprius.

When constructing the portfolio, exclusion criteria are applied to restrict investments in companies and issuers with significant links to the following sectors:

• Tobacco
• Companies involved in weapons prohibited by international conventions
• Gambling companies
• Producers of adult entertainment

Principal Adverse Impacts (“PAI”)

The adverse impacts of investments on sustainability factors are taken into account when making investment decisions, as an integral part of the investment process.

Active Ownership

On behalf of its clients, Proprius Partners Oy engages in a broad range of dialogue aimed at encouraging investee companies to improve their environmental, social and governance practices and to take a long-term perspective into account in decision-making.

Net Impact of the Fund

Upright’s net impact model evaluates four dimensions on a balanced basis: Society, Knowledge, Health and Environment. Upright’s platform calculates a score for each of these four dimensions using research findings and publicly available company- and industry-level data.

The result is a single net impact score, which Proprius Partners uses as a sustainability indicator both for the fund as a whole and for individual investments.

Binding Elements

The fund’s net impact, based on Upright’s model, must always be at least zero.

For investments with a negative net impact, the fund’s portfolio management team must document the rationale for making the investment and provide a credible explanation either as to why the team’s view differs from the impact assessment or how the investee company can improve its impact.

At least 50% of the fund’s investments must have a positive net impact (>0). Sector screening prevents investment in sectors that Proprius Partners has excluded.

Data Sources and Processing

We use a range of internal and external data sources and data providers to ensure that the fund’s investments are made in accordance with the environmental and/or social characteristics it promotes.

The primary data source consists of Upright’s net impact assessments, which we seek to supplement with company-specific reported data.

External service providers are reviewed annually to assess the methodologies applied and to ensure the quality of the data. In addition, the portfolio management team maintains an ongoing dialogue with companies and with Upright regarding any shortcomings or potential misunderstandings in the impact assessments.

Limitations to Methodologies and Data

Data sources and service provider methodologies may change over time, and forecasts and data may be incomplete or differ from real-world observations.

Due Diligence

Proprius Partners continuously applies appropriate due diligence by engaging with service providers and critically assessing the quality of data and forecasts in relation to Proprius’ own observations of company operations and the companies’ own reporting.

Engagement Policies

We practise an active ownership policy. We regularly meet with the senior management and investor relations teams of the companies we own, giving Proprius effective channels to directly influence company conduct, for example by raising any identified concerns regarding a company’s operations.

Through our contacts, we also have the ability to communicate with major shareholders and board members. For Proprius, the most effective way to promote active ownership is therefore to maintain regular contact with company management and other decision-making bodies.

To us, ownership means closely monitoring companies and their businesses, and engaging in constructive dialogue with senior management, owners and other stakeholders. By far our strongest opportunities for influence are typically found in management dialogue, which is where we place particular emphasis.

Especially in companies with smaller market capitalisations, we may be significant shareholders. This can mean holdings amounting to several per cent of a company’s total share capital.

General Meetings

We vote at general meetings, or authorise another party to vote on behalf of our funds, when we believe this genuinely promotes the interests of our unitholders and when we consider the matters being voted on to be particularly important for the companies in question. Such situations include, for example, mergers and acquisitions and other special situations.

Board and Other Positions of Trust in Companies

Significant ownership stakes may also create various opportunities or obligations to participate in a company’s board work or other positions of trust within the company.

Participation in nomination committees is not in the interests of our funds’ unitholders without compelling reasons, as exposure to inside information may restrict portfolio management flexibility. We also do not appoint a person outside portfolio management to nomination committees, as members of such committees should have a strong understanding of the company and/or its industry.

We do not participate in board work, as it would significantly restrict portfolio management flexibility.

To us, ownership means closely monitoring companies and their businesses, and engaging in constructive dialogue with senior management, owners and other stakeholders. By far our strongest opportunities for influence are typically found in management dialogue, which is where we place particular emphasis.

Use of a Proxy Adviser

We may use a proxy adviser as referred to in the Finnish Securities Markets Act, whose registered office is located in Finland or in a third country, provided that the services are offered within the EEA.

A proxy adviser refers to an entity that, as its business, analyses information published by the issuer of shares admitted to trading on a regulated market in order to prepare research supporting investors’ voting decisions, or to provide advice and recommendations relating to the exercise of voting rights.

Before subscribing, please carefully review the fund’s Key Information Document, Fund Prospectus and Fund Rules. These documents set out the detailed subscription and redemption terms, which you accept as a client when paying the subscription amount. A written subscription notice must be submitted to Proprius Partners Oy no later than three (3) banking days before the subscription date, either using the subscription form or the online subscription form. All supplementary information pages must be submitted as attachments to the subscription form.

Proprius Partners’ non-UCITS funds are open for subscriptions twice a month: on the 15th day of each calendar month and on the last banking day of each calendar month. If the subscription date is not a banking day, the subscription date will be the preceding banking day. The subscriber must notify Proprius Partners of their intention to subscribe for fund units and the amount to be invested no later than three (3) banking days before the subscription date. The investment amount must be credited to the fund’s bank account on the subscription date. The minimum initial subscription amount is EUR 50,000, and the minimum additional subscription amount is EUR 10,000. Please transfer the amount corresponding to your subscription to the bank account of the relevant fund. In the payment message field, please include the client’s name and date of birth or, in the case of a company, the Business ID.

The subscription price is the value of the fund unit on the subscription date less any applicable subscription fee. Confirmation of the subscription is available in the Proprius Partners client portal.