Polaris ESG | Polaris Capital Group Co., Ltd.

《Polaris ESG》

Environment

By supporting the sustainability management of portfolio companies, we promote the enhancement of corporate value and are working to play a part in achieving a decarbonized society.

Measuring, Disclosing, and Reducing GHG (Greenhouse Gas) Emissions

Polaris Capital Group has been measuring and disclosing GHG emissions since December 2022. In addition, we concluded a comprehensive agreement with Zeroboard Inc. to support the calculation, management, and reduction of GHG emissions for all investees. This leads to the reduction of GHG emissions and the promotion of sustainability management.

Polaris Capital Group GHG (greenhouse gas) emissions in 2022

Scope 1 and 2	34t-CO₂
Scope3	34,083t-CO₂ (Scope 3 Category 15 emissions from portfolio companies are calculated by estimating the Scope 1 and 2 emissions of each portfolio company.)

Social

We strive to respect human rights, practice diversity and inclusion, and contribute to society through the work of diverse staff. We also aim to create a society where each individual can pursue happiness and purpose in life. In the field of education, we will continue our efforts to play a role in improving the financial literacy of students through the provision of endowed courses and internships.

Initiatives for Diversity and Inclusion

Appointed Maoko Kotani as an outside director: In June 2021, Maoko Kotani, who is well-known for WBS newscasting and ESG activities, was appointed as an outside director. At Board of Directors meetings, free and vigorous discussions are held with the goal of enhancing corporate value.

Appointed Chief Sustainability Officer (CSO): In March 2022, Yoshimi Harada, a member of the Operations Group, was appointed as CSO. The ESG Promotion Committee was established headed by President & CEO Yuji Kimura, and we are working to raise awareness within the company and promote ESG in investees.

Open recruitment for professional positions: In April 2022, a new system was established to allow assistants with the necessary knowledge and skills to be promoted to professional positions if they wish. As of September 2023, two assistants have shifted to professional positions using this system and are active in their respective Groups.

Promoting globalization: Polaris CG Singapore Pte. Ltd. employs Singaporean nationals. We will continue to recruit excellent staff.

Contributions in the Field of Education

We opened endowed courses at Hitotsubashi University in 2017 and Kyoto University in 2019. In these endowed courses, we provide lectures based on our abundant investment experience to date, such as on the relationship between enhancing corporate value and ESG, and the roles and challenges of private equity funds. Lectures with real-world atmospheres, such as when inviting the presidents of portfolio companies as guests, are very popular with students and serve as a place for recurrent education and reskilling for the large number of working students enrolled. In addition, we are actively working in the education field and introduced an internship system in 2022.

■Outline of Kyoto University Polaris endowed courses
(examples)

First term: Venture ecosystems	Second term: PE and corporate value improvement
Social Issues and "Venture Ecosystems"	Expansion and Issues of PE
About Venture Capital	The Current Situation of PE Funds and Polaris's Efforts
Prospects for University-originated VCs / University-originated Startups	Investors and PE Funds
Development of a Business Succession-type Search Fund	M&A and PE
Start-ups and IPOs	Investment Banks and PE
Venture-backed Companies that Solve Social Issues	Case Studies of Specific Investees
Carbon Neutrality and Venture Capital	Large Companies (business restructuring)
Initiatives of Venture-backed Climate Tech Companies	Growth-supporting Small Cap PE Funds
PE and the Future	Summary

■Outline of internship (examples)

Concept
Through internships, undergraduate and graduate students are exposed to the knowledge of investment fund management operations we have cultivated since our founding, and learn about the significance and fun aspects of these operations.
Specific details
In this program, participants experience the Investment Committee, which is the decision-making body for execution of investment. The program covers a series of investment flows, such as verifying the appropriateness of investments and proposing measures to improve corporate value.

Governance

We will conduct management with high transparency and fairness in order to be a company that offers value to all stakeholders. We promote the exercise of corporate governance functions not only in the management of our company, but also in investment decision-making and post-investment monitoring.

Corporate Governance

Our Company’s Board of Directors consists of six members, three full-time directors and three outside directors, and the supervisory function from outside directors is exercised appropriately.

As general partners (GPs) who appropriately manage the assets entrusted by investors, the members of the Investment Committee responsible for investment decision-making must be nominated by the Board of Directors. The Investment Committee is chaired by the President & CEO, and decisions are made subject to a majority of the committee members present.

■Corporate Governance System

Compliance

Polaris has established compliance regulations and compliance manuals, and the Compliance Officer plays a central role in managing the operation of these regulations under the supervision of the Internal Control General Manager.
As for compliance with investees, we promote compliance activities in accordance with our basic policy, just as we do at Polaris.

《Basic Compliance Policy》

Polaris Capital Group Co., Ltd. (hereinafter referred to as "Polaris") shall comply with the following matters in good faith and in a fair manner.
In order to ensure thorough compliance with such regulations, Polaris has established compliance regulations, and all officers and employees of Polaris shall observe and act in compliance with these standards.

1. Strict compliance with laws and regulations

Polaris will strictly comply with all laws, regulations, and other requirements and carry out ethical corporate activities in accordance with social ethics.
2. Corporate activities with social responsibility and a public mission

As a company in the financial and funding industries, Polaris will always be aware of the importance of social responsibility and public missions, and will strive to conduct sound and appropriate business operations based on self-responsibility.
3. Respect for human rights

Polaris will strive to eliminate all human rights violations and discrimination in the company, and will endeavor to create a safe work environment in which human rights and personalities are respected.
4. Confrontation with anti-social forces

Polaris will resolutely confront anti-social forces and organizations that threaten the order and safety of civil society.

Sustainability at Polaris