Sustainability
Disclosure

Mekong Capital implements an E&S structure in the investment process, which ensures that all activities undertaken by Mekong Capital itself and/or by the Funds are consistent with the Applicable Requirements. Mekong Capital’s applicable requirements draw upon the IFC Performance Standards on Environment and Social Sustainability, ADB’s Safeguard Policy Statement, World Bank’s EHS guidelines, as well as the relevant local laws and regulations.

Mekong Capital’s Investment Committee will factor in sustainability risks in the decision making process by:

• Defining the investment strategy, how sustainability risks will be considered, and whether the proposed strategy has an E&S characteristic or objective;
• Overseeing and approving investments to ensure E&S risks has been considered in the investment decisions;
• Monitoring the performance and impact of E&S on the returns to the fund; and
• Updating, as required, the investment strategy to ensure that E&S risks in the underlying investments of the Funds under management are in line with the overall investment strategy.

The following E&S due diligence process is integrated in the investment decision making process:

• Assess proposed deals against Mekong Capital’s exclusion list;
• Carry out proper E&S due diligence of proposed deals to identify E&S risks and gaps in meeting with Mekong Capital’s sustainability policy; and
• Propose an E&S corrective action plan and ensure that the Portfolio Company will fulfil the corrective action plan.

Mekong Capital will consider the principal adverse impacts, whether material or likely to be material, of the following sustainability factors on investment decisions: biodiversity; climate change; deforestation; ecosystem degradation; soil and land pollution; toxins; water pollution; health and safety; labor rights; harassment and discrimination; business ethics; stakeholder management; corporate governance; and supply chain management.

Mekong Capital has a remuneration policy, which includes appropriate working conditions for its personnel. Mekong Capital employees are aware of their roles in performing in line with Environmental and Social Management System of Mekong Capital which ensures all sustainability risks are routinely monitored and mitigated.