This disclosure is made by FlyCap AIFP, SIA (Management Company) to comply with the requirements of Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability‐related disclosures in the financial services sector ("SFDR")

 

BACKGROUND AND SCOPE

 

The Regulation (EU) 2019/2088, also known as the EU Sustainable Finance Disclosure Regulation (“SFDR”), requires financial market participants and financial advisers to publish information on their website about their policies on the integration of sustainability risks in their investment decision making and investment advice, including whether and how adverse impacts of investment advice are considered and how remuneration policies are consistent with the integration of sustainability risks in investment decision-making and investment advice.

 

Article 3 of the SFDR requires financial advisers to publish information about their policies on integrating sustainability risks in their investment advice. Sustainability risk is defined as an environmental, social, or governance event or condition that, if it occurs, could cause an actual or potential material negative impact on the value of investments under Article 2 (22) of the SFDR.

Examples of sustainability risks that are potentially likely to cause a material negative impact on the value of an investment, if those risks occur, are as follows:

• Environmental sustainability risks may include climate change, carbon emissions, air pollution, rising sea levels, coastal flooding, or wildfires.

• Social sustainability risks may include human rights violations, human trafficking, child labor, or gender discrimination.

• Governance sustainability risks may include a lack of diversity at the board or governing level, infringement, or curtailment of rights of shareholders, health and safety concerns for the workforce, and poor safeguards on personal data or IT security.

The sustainability risk can either represent a separate risk category or have a reinforcing effect on other risk categories, such as market risk, liquidity risk, credit risk, or operational risk.

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INFORMATION ABOUT POLICIES ON THE INTEGRATION OF SUSTAINABILITY RISK IN INVESTMENT DECISION-MAKING PROCESSES (Article 3 disclosures)

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FlyCap AIFP, SIA ("FlyCap") incorporates environmental, social, and corporate governance (ESG) risks into our investment decision-making process. A sustainability risk refers to an environmental, social, or governance event or condition that, if it occurs, could cause an actual or potential material negative impact on the value of the investments. ESG risks are assessed throughout the due diligence and investment negotiation processes, with the scope of assessment varying based on the individual characteristics of each investment case. FlyCap recognizes that sustainability factors can, directly and indirectly, influence the return and cost structure of our funds and investments. 

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FlyCap adheres to an exclusion policy, refraining from investing in businesses involved in activities that pose significant sustainability risks, such as the sale of alcoholic beverages, betting and gambling, firearms and ammunition, adult entertainment, and the production, processing, and marketing of tobacco products, and others.

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While ESG considerations are integral to our investment process, they are not the primary objective of our operations. FlyCap does not currently manage any funds that specifically promote environmental or social characteristics.

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STATEMENT OF NO CONSIDERATION OF ADVERSE IMPACTS OF INVESTMENT DECISIONS ON SUSTAINABILITY FACTORS (Article 4 disclosures)

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Currently, FlyCap does not consider the principal adverse impacts (PAI) of investment decisions on sustainability factors as defined by Article 4 of the SFDR. This approach is due to the size, nature, and scale of FlyCap's activities. Our investment focus is on small and medium-sized enterprises (SMEs), which are not required to collect and report the data necessary to assess and monitor PAI reliably. For most SMEs we work with, the requirement to collect and report such data would be disproportionate to their operational size and available resources. FlyCap will continue to monitor the situation and re-evaluate our approach as more data becomes available.

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INFORMATION ON CONSISTENCY OF REMUNERATION POLICIES WITH THE INTEGRATION OF SUSTAINABILITY RISKS (Article 5 disclosures)

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Remuneration Policy promotes sound and effective risk management ensuring that the structure of remuneration and practices that are consistent with, does not encourage excessive risk-taking or conflict of interest. The remuneration policy does not incorporate sustainability risks.​

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This information was first published on 24.08.2022. It was reviewed and updated on 04.07.2024.