M7 SFDR Website Disclosure
M7 Real Estate Financial Services Ltd, M7 Real Estate Ltd and M7 Capital Ltd (collectively “M7”) are managers and advisers to “Article 6 Funds” as defined in 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, as amended from time to time (“SFDR”)). Sustainability Risks refer to environmental, social or governance events, or conditions, such as climate change, which could cause a material negative impact on the value of an investment.
Sustainability risks are an important aspect of real estate investment and management and, therefore, a contributor to the financial performance of the funds. A broad range of sustainability risks are considered as part of M7’s investment decision-making process and ongoing property management. M7 has adopted an ESG Framework, which was built in collaboration with external advisers, as of September 2021, and is implementing best practice across the business in areas including:
- A firm-wide Responsible Investment Policy and ESG Strategy, with oversight from an ESG Committee.
- ESG Pre-Acquisition and Due Diligence Checklists as part of the investment process.
- Property Manager Standards of Sustainability and Guidance covering:
- Tenant Management and Green Leases
- Sustainable Tenant Fit-Outs
- Sustainable Development and Refurbishment
- Sustainability risks that are considered as part of the investment process include:
- Phase 1 (and if applicable, Phase 2) environmental reviews during purchase due diligence.
- Data such as age of building, energy rating, sustainability certification, flood risk, site contamination, deleterious materials, climate risk assessment, fire risk and health & safety risk.
- Social risks such as occupiers posing problems in respect of bribery and corruption, anti-slavery and child/forced labour, diversity and equality issues or significantly high environmental impact.
- Establishing appropriate environmental management plans accordingly.
Each real estate asset will present a unique set of circumstances, both in respect of acquisition and ongoing management. M7 actively monitors its underlying investment portfolio holdings with respect to ESG issues and opportunities, and will increasingly capture and report specific ESG data as capability in this area develops. M7 will also continue to develop its ESG Framework in accordance with regulations and industry best practice. Some further information on M7’s practical day-to-day approach to sustainability practices is available on the website under Corporate Governance > Environment & Sustainability.
The EU Regulation also covers Principal Adverse Impacts, which are any negative effects that investment decisions or advice could have on sustainability factors. M7 is not a “large entity” for the purposes of the regulation and does not consider or measure principal adverse impacts on sustainability factors, as the nature and volume of the data collection and level of assessment required would be disproportionate at this time. As with all aspects of the ESG Framework, this approach is subject to ongoing review and will further develop over time.
M7 has a remuneration policy in adherence with the applicable FCA remuneration codes. The policy includes measures to ensure an appropriate balance between fixed and variable remuneration that takes into consideration M7’s policies and procedures, and does not encourage excessive risk taking. Where the remuneration policy applies to an individual, adherence with M7’s ESG policies and consideration of sustainability risks will therefore form a part of the assessment of an individual’s remuneration.
In respect of the EU Taxonomy Regulation, the investments underlying M7’s funds do not take into account the EU criteria for environmentally sustainable economic activities.