04.04.2019

NN IP Adopts Equator Principles

NN Investment Partners (NN IP) has completed the process of adopting the Equator Principles (EPs) for its infrastructure and project finance investments. The EPs is a risk management framework, adopted by financial institutions, for determining, assessing and managing environmental and social risk in projects and is primarily intended to provide a minimum standard for due diligence and monitoring to support responsible risk decision-making.

While the EPs have already played an important role in our investment process in the past, their formal adoption also adds a reporting obligation. No funding will be granted to infrastructure and project finance investments that do not comply with the EPs, strengthening the sustainable character of our portfolio of investments.

NN IP is adopting the Equator Principles (EPs) as of today. By doing this we are committing ourselves to the globally-recognized benchmark for the financial industry to manage environmental, social and corporate governance risks. The EPs were launched in 2003 with the objective of ensuring that projects are developed in a socially responsible manner and reflect sound environmental management practices. The third edition of the EPs, which came into effect in 2013, extend their application from infrastructure, project finance and advisory services to project-related corporate loans and bridge loans.

The EPs are adopted voluntarily by financial institutions that wish to reduce their impact on the environment and society through the projects they finance. At present, there are over 90 financial institutions in 37 countries that have adopted the EP. With this step NN IP underpins the strong focus on sustainability in our infrastructure debt strategy. The EPs are based on the International Finance Corporation’s (IFC) Performance Standards on Environmental and Social Sustainability, and on the World Bank Group’s Environmental, Health and Safety Guidelines.

Valentijn van Nieuwenhuijzen, CIO at NN Investment Partners: “We are very proud to adopt the Equator Principles, which are a logical addition to our Responsible Investing framework. We firmly believe that integrating these elements into our analysis and decision-making process can contribute to enhancing returns and mitigating risks. Financing the right projects enables us to generate attractive returns and offers diversification benefits for more traditional fixed income portfolios while working towards a more sustainable future. Think of low carbon mass transit, flood protection infrastructure or building schools.”

Being a member of the EP Association perfectly supports NN IP’s goal of contributing to a more sustainable economy and prosperous society. The sustainable infrastructure debt strategy is a good example of a strategy where sustainability and returns go hand-in-hand. The strategy focuses on social infrastructure, transportation, energy assets, utility and environmental assets, and digital infrastructure – giving it a broader sustainability strategy than just green energy. This will also be reflected in the reporting that the fund provides to investors, which will include measures such as GHG avoidance, energy produced and waste reduced, or more specific data depending on the sector, such as increased capacity in transportation (e.g. Lightrail) or reduction of water & energy consumption (buildings). All of our infrastructure investments are linked to the UN Sustainable Development Goals, and our reporting gives a clear view of the specific goals the fund contributes to.

Source: NN IP

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