Cottonwood Technology Fund MP B.V. (hereafter referred to as ‘Cottonwood’) is obligated to adhere to the 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 (referred to as ‘SFDR’). Cottonwood is responsible for publishing its policy on integrating sustainability aspects into its investment practices and reporting on the sustainability impact of its funds.
Integration of sustainability risks
Sustainability risks may vary from investment to investment and can include risks of environmental damage, social risks (including safety and human rights violations and exploitation), governance risks (inadequate oversight and internal governance of the companies, board structure, compensation and approach to anti-bribery and anticorruption), litigation risks linked to ESG issues, as well as the risk of political and regulatory changes on investments related to each of the foregoing.
Cottonwood has established a dedicated investment process to mitigate such risks and ensure that its investments are aligned with the fund’s investment strategy. When selecting investments, Cottonwood considers sustainability risks during the due diligence phase. During the investment due diligence, potential sustainability risks for a fund are identified. Once identified and evaluated as financially material for an individual investment, sustainability risks and the mitigation thereof are directly integrated in the related investment decision.
Cottonwood has identified the most important and relevant sustainability risks for the Cottonwood funds and included the likely impact of the sustainability risks, if they occur, on the returns of the investments of the funds.
No consideration of adverse impacts of investment decisions on sustainability factors
In line with Article 4, Subsection 1(b) of SFDR, Cottonwood explicitly declares that it does not consider adverse impacts of investment decisions on sustainability factors as outlined. Consequently, Cottonwood does not disclose information as described in Article 4, Subsection 1(a) of SFDR. This because, the costs connected to it are disproportionate to the nature and size of Cottonwood.
Contact Us
If you have any questions about this SFDR Statement, please contact us at info@cottonwood.vc.