SFDR Disclosures

OTB Fund Management B.V., OTB Fund 2 Management B.V. and OTB Fund 3 Management B.V. (each, an AIFM, and together, the AIFMs), each a Dutch-based registered alternative investment fund manager within the meaning of article 3(2)(b) of Directive 2011/61/EU of 8 June 2011 on alternative investment fund managers (AIFMD), make the following disclosures for the purposes of Regulation (EU) 2019/2088 of 27 November 2019 on sustainability-related disclosures in the financial services sector (SFDR) and Regulation (EU) 2020/852 of 18 June 2020 on the establishment of a framework to facilitate sustainable investment (the Taxonomy Regulation).

As clarified by the European Commission in its Q&As on sustainability-related disclosures published on 14 July 2021, each AIFM must comply with certain SFDR requirements applicable to registered alternative investment fund managers. Each AIFM has the same policies and practices in relation to the matters described below, and the disclosures set out in this document accordingly apply equally to each AIFM and to each of the Funds (as defined below) that it manages.

OTB Fund Management B.V. acts as registered alternative investment fund manager of Growth Fund I C.V. and OTB Fund Coöperatief U.A. OTB Fund 2 Management B.V. acts as registered alternative investment fund manager of OTB Fund 2 Coöperatief U.A. OTB Fund 3 Management B.V. acts as registered alternative investment fund manager of OTB Fund 3 Coöperatief U.A. (each, a Fund, and together, the Funds).

Each of the Funds qualifies under article 6 of the SFDR as it does not promote environmental or social characteristics (article 8 of the SFDR) nor does it have sustainable investments as its objective (article 9 of the SFDR).

I. AIFM-related disclosures

Transparency of sustainability risk policies and transparency of the integration of sustainability risks – article 3(1) and article 6 of the SFDR

General overview

A sustainability risk refers to an environmental, social or governance (ESG) event or condition that, if it occurs, could cause an actual or a potential material negative impact on the value of an investment.

Each AIFM reviews and assesses potential sustainability risks within the meaning of SFDR as part of its decision-making process and ongoing risk monitoring with respect to investments made or to be made by the relevant Fund(s) it manages and has integrated such review into its internal procedures and policies, as further detailed hereafter.

Relevance of sustainability risks

Sustainability risks may affect the performance of each of the Funds having regard to the types of investments made or to be made in accordance with the relevant Fund’s investment policy and objectives, meaning that if any such risk occurs, returns on investments may be materially negatively affected as a result. Investors and potential investors should note that it is difficult to assess with reasonable certainty the probability of the occurrence of such risks and the likely impact of such materialized sustainability risks on the value of investments.

The identification and assessment of risks, including sustainability risks, will take place on an ongoing basis if and when investments are made in accordance with the relevant Fund’s investment policy. Such review is performed by the relevant AIFM, as summarized below:

1. prior to an investment decision being taken on behalf of the relevant Fund, the relevant AIFM identifies the material risks, including sustainability risks, associated with the proposed investment.
2. these risks form part of the overall investment proposal to be assessed by the relevant AIFM.
3. ultimately and following its assessment, the relevant AIFM makes the relevant investment decision having regard to the relevant Fund’s investment policy and objectives and subject to the investment committee’s approval.

No consideration of adverse impacts of investment decisions on sustainability factors – article 4(1)(b) of the SFDR

Article 4(1) of the SFDR requires fund managers such as the AIFMs to provide a clear statement as to whether or not they consider the “principal adverse impacts” of investment decisions on sustainability factors, e.g. environmental, social and employee matters, respect for human rights, anti-corruption and anti-bribery matters.

Although ESG and sustainability risks are important to each AIFM, none of the AIFMs considers the adverse impacts of investment decisions on sustainability factors in the manner prescribed by article 4(1) of the SFDR, in particular due to the fact that (i) no reliable and sufficiently available or accessible data is available to perform such impact measurement and provide the mandatory reporting imposed by the regulatory technical standards in a consistent manner; and (ii) the underlying investments are not generally required to report on such factors in the manner prescribed by SFDR.

None of the AIFMs intends to consider principal adverse impacts of investment decisions on sustainability factors in the near future.

Transparency of remuneration policies in relation to the integration of sustainability risks – article 5(1) of the SFDR

For the purposes of article 5(1) of the SFDR, each AIFM declares that it has not put in place a remuneration policy in light of the fact that it qualifies as a registered alternative investment fund manager and thus does not fall under such requirement under the AIFMD.

II. Fund-related disclosures

Transparency of other financial products in pre-contractual disclosures and in periodic reports – article 7 of the Taxonomy Regulation

The investments underlying each of the Funds do not take into account the EU criteria for environmentally sustainable economic activities.