ESG

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Welcome To PrimeHills

The importance of environmental, social and governance (ESG) factors in investment decisions continues to grow exponentially - to the point where an understanding of ESG now appears critical to carrying out a skillful investment process. At PrimeHills, we are committed to helping our clients navigate this important and evolving aspect of investment management. In light of this, we surveyed 300 firms from the active management industry1 across equity, fixed income and private markets to understand how asset managers are integrating ESG considerations in their investment process. Our results are presented across the following categories:
* Formalization of responsible investment policies
* Dedicated personnel for ESG-related research
* The use of quantitative ESG data
* Engagement with portfolio companies


Our ESG Investment Philosophy

Because we're committed to creating a sustainable tomorrow, we're deeply aware that the investment decisions we make today will resonate far into the future - for our clients, communities and planet. That's why we've taken concrete steps to formally integrate environmental, social and governance (ESG) information into our investment analysis. We're continually looking at ways to engage companies to improve their ESG credentials and develop more sustainable business models. Our ingrained fundamental approach enables the systematic analysis of ESG topics through our interactions and engagements. This insight provides us with a dynamic picture of risks and opportunities, reflected by our firm-wide ESG scoring system. We're building a better future, as we invest in lasting change together.

Our ESG Approach

At PrimeHills, we think holistically about returns

We invest and engage with the conviction that authentic ESG integration across our portfolios leads to exceptional value creation and positive, long-term impact on the environment and society. Our drive for continuous improvement informs how we approach our business and investments. We focus on addressing the complex challenges of today as well as the critical issues of tomorrow.

We believe that strong ESG management leads to better investment outcomes and positive impacts for our stakeholders • We strive to integrate ESG considerations into how we operate as a firm, our investment processes and portfolio management approach • We seek to incorporate ESG risks and upside throughout our investment and ownership processes, and tailor our ESG approach to each investment strategy and critical ESG factors that shape long-term growth and performance • We aim to deliver strong returns and positive social and environmental outcomes as a leader in ESG integration

Partners with management teams to help build and grow great companies. As pioneers of the value-added investment approach, our success is built on a highly rigorous approach utilizing deep industry and company insights and a significant investment in resources and expertise to drive strategic and operational transformation at our companies. We embed ESG priorities into our diligence approach and long-term strategies – meeting our portfolio companies where they are and continuously improving to build capabilities, set metrics and implement goals to hold ourselves accountable.

Double Impact

Invests in mission-driven companies that deliver both competitive financial returns and measurable social and environmental impact in three core impact themes: health and wellness, education and workforce development, and sustainability. We identify companies in sectors that can create transformational change by helping them reach their full social and/or environmental potential. We leverage deep industry experience and an active, valueadded approach. Our focus on operational additionality enables us to drive impact results alongside financial returns by scaling and transforming companies.

Invests in pharmaceutical, biotechnology, medical device, diagnostic and life science tool companies across the globe, with a focus on companies that drive both medical innovation across the value chain and enable innovation to improve the lives of patients with unmet medical needs. ESG is inherently linked to our strategy, and we seek to build a diverse portfolio of highimpact, high-value-creating companies with our rigorous, science-first approach.

Invests to transform major industries by partnering early with mission-driven founders to build enduring technology companies at all stages. This starts with a partnership that has deep domain expertise and extensive operating experience, leveraging the firm's global platform to create a path to scale. We include ESG considerations in the strategic investment approach and aim to create lasting impact for all stakeholders.

Focuses on hard-to-access sectors at the nexus of emerging economic and demographic trends. Through this approach, we aim to create durable income streams to deliver strong, consistent performance. We are committed to integrating ESG into investment management and decision

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Integrating ESG

Setting the Foundation

At PrimeHills, we anchor our investment decision-making in strategic, fact-based due diligence that considers a broad range of risks and value levers, including those related to ESG factors. We seek to understand investment opportunities holistically, taking into account strategies, products, services and business practices. Our investment teams strive to assess key ESG diligence findings, elevate material risks and opportunities for discussion with investment committees and articulate potential ESG areas of focus for post-investment blueprinting and monitoring. For new investments, we evaluate relevant ESG factors aligned to our core ESG commitments and aim to achieve the following diligence goals.

Portfolio Management

Engaging to Drive Holistic Returns.

We believe embedding ESG into business strategy and responsible operations is an integral part of our approach to creating value and growing great businesses. Postinvestment, we are committed to driving meaningful progress across our core ESG commitments and improving performance on material ESG factors specific to each business. As investors and global citizens, we strive to support the environment and society by harnessing the influence of our firm, investments and people.

Portfolio Management

Engaging to Drive Holistic Returns.

We believe embedding ESG into business strategy and responsible operations is an integral part of our approach to creating value and growing great businesses. Postinvestment, we are committed to driving meaningful progress across our core ESG commitments and improving performance on material ESG factors specific to each business. As investors and global citizens, we strive to support the environment and society by harnessing the influence of our firm, investments and people.

Active Governance & Stewardship

Our Active & Intentional Approach to Governance.

We believe good governance is good business and helps our companies grow with integrity and respect for people and the environment. Our senior leadership is highly engaged in driving ESG integration across the firm, our businesses, investment evaluation and portfolios. Our comanaging partners and business unit heads make up the ESG Leadership Coordination Team, which was created in 2020 to further strengthen ESG efforts and drive ESG integration across investment processes and portfolio management. Thus far, the team has led several key initiatives, including sharpening our firm's purpose, defining the firm-wide ESG strategy, prioritizing our five core ESG commitments across our platform and executing the firm's carbon neutral pledge.


This team continues to advance our ESG approach and provide thought leadership and best practice sharing across the platform. PrimeHills values engaging and collaborating across ESG forums. We are signatories of the United Nations Principles for Responsible Investment (UN PRI) and commit to embrace all six principles. We integrate our core ESG commitments and considerations into the firm's operations, investment processes, and portfolio management approach. We also participate in a number of industry initiatives focused on sustainability and climate action, including the Private Equity Task Force at Ceres and the Climate Action and Biodiversity working groups at the Private Equity Sustainable Markets Initiative, both leading climate-focused forums that foster collaboration across GPs and LPs to help advance sustainable investment practices. PrimeHills is a member of Focusing Capital on Long Term Global (FCLTGlobal), concentrating on stakeholder capitalism and leading responsible investment practices. We are also members of Business for Social Responsibility (BSR), an organization of sustainable business experts that works with its global network of the world's leading companies to build a just and sustainable world.

Sustainable Growth & Reducing Climate Impact

Climate change poses a systemic risk to the global economy, representing not only a strategic and business challenge for all companies and investors, but also a significant opportunity for those that align their businesses, operations and portfolios on a pathway to decarbonization. Significantly scaling back emissions by mid-century requires businesses to develop sustainable business lines, adapt to new regulations, build stronger stakeholder relationships and improve resource efficiency and cost savings along the way. We take a broad view of climate-related risks and strive to embed sustainability into our investment decisions and portfolio management approach. Recognizing that the global transition to low carbon, climateresilient pathways will require change and collaboration across industries, geographies and communities, we aim to do our part to accelerate this transition, consistent with the goals of the Paris Agreement. We have grounded our approach to sustainable growth and reducing climate impact in areas where we believe we can have meaningful, measurable impact.



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Fair Employment, Engagement & Well-being







At PrimeHills, we value growing talent from within. We pride ourselves on being a purposedriven team with a distinct collaborative culture. We aim to be a high-performing organization with engaged employees. To attract, retain and develop people, we continue to refine and evolve our talent value proposition to provide tailored and relevant growth opportunities for our employees through ongoing training, mentorship opportunities and senior leadership engagement. We prioritize employee wellbeing through employee networks, comprehensive programs and benefits. With a strong commitment to pay equity, we conduct regular pay practice reviews. We continue to build leading teams with strong, positive culture and working dynamics globally despite recent challenges associated with the COVID-19 pandemic. Our apprenticeship-based culture grounds our talent strategy. As we scale teams and functions across business units, we have doubled down on investing time and resources on employee development and training opportunities. Across business units, we provide dedicated resources, training tools and leadership development opportunities to position our people for success.

Community Engagement







At PrimeHills, we engage and contribute to our communities locally and across the globe while also encouraging our companies and investments to establish meaningful community initiatives.. Giving back to our communities with our time, expertise and resources has long been a part of PrimeHills's DNA. Our guiding philosophy is to engage with intention and do our part across our local and global communities. Since our founding, PrimeHills has supported a wide array of charitable and nonprofit organizations in communities around the world with our time, expertise and resources. Our commitment to citizenship has been a longstanding priority for our partnership and our employees. Our employees are collectively involved with more than 220 nonprofit organizations, serving on a variety of boards, and donate time and resources to hundreds more. Through PrimeHills Community Partnership (BCCP), we strive to make real impact in the neighborhoods where we work and live. Across our investments, we encourage and support our investments' efforts to engage and contribute to their communities, locally and across the globe. PrimeHills has established multiple initiatives and ongoing programs to solidify our contribution to communities around the world:



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HealthCare

Expanding Access to Care and Improving Patient Outcomes. At PrimeHills, successful healthcare investing is about expanding access to care and improving quality and outcomes for patients and healthcare consumers. With more than three decades of experience, we have seen firsthand how evolving regulatory and payer dynamics, trends in medical practice, technology and new consumer models are shaping the future of healthcare. We build companies with the conviction that the key to strong business and patient outcomes is people throughout the organization. The COVID-19 crisis made clear the impact that dedicated, talented people can have on the well-being of a population, from frontline healthcare workers delivering care to the most vulnerable to pharmaceutical R&D teams racing to develop game-changing vaccines.


Healthcare skills at all levels of the industry are in finite supply – meaning that the ability to attract and retain the best talent can make the difference between merely participating in a healthcare sector and leading it. As such, when we make a new healthcare investment where we have significant influence, one of our first moves is to ensure a senior focus on employees by empowering the Chief Human Resources Officer, creating a trickle-down awareness that people are the center of growth plans. Across our investments, we make concerted effort to demonstrate our care for the needs of frontline staff, partnering with companies to strengthen relationships between caregivers, patients and communities, and energizing employees to provide high-quality patient care.