Karma Ventures is an early-stage venture capital firm, supporting entrepreneurs in figuring out the path to growth in all aspects-commercial, strategic, and technological. As investment manager, we have a duty to act in the best long-term interests of our investors. In this fiduciary role, we believe that environmental, social, and corporate governance (ESG) issues have an impact on the performance of our investment portfolio.We believe that healthy growth is intertwined with taking responsibility–environmentally, socially and in governance.
Our ESG policy is a set of principles expressing how our values and responsibility are mirrored in our investment activities and our business operations.
Our values are:
Trust - we aim to have mutual trust with the founders and the management of the companies we invest in, our investors and all of our team members and partners
Transparency - we aim for an open and honest dialogue with all counterparties to increase mutual understanding, trust and confidence in each other
Respect - we value and care about the companies we invest in and their founders; the same applies for our investors as well as the society and the environment
While we have defined these values internally, we aim to advocate the same values within our portfolio companies as well as the local venture capital ecosystem.
We have integrated ESG into the full life-cycle of our investment activities. We have set clear ESG screening aspects, that we analyse before each potential partnership to evaluate related risks and set expectations. During the investment period, we actively liaise with our portfolio companies, contributing as board members and/or observers, guiding and supporting the companies in finding their own ESG approach. We seek appropriate disclosure on relevant ESG issues by the entities we invest in.
We are actively participating in the pan-Baltic and Estonian VCA activities, contributing to the development of our industry in the region and highlighting the importance of sustainable financing and responsible investment. We belong to the Invest Europe family and closely follow the ESG related developments in the broader ecosystem.
We also aim to keep an honest dialogue and active relationship with our investors and other stakeholders and seek alignment on sustainability-related values and principles. Karma Venture's ESG report will be published and made available to our investors once a year.
No consideration of adverse impacts of investment decisions on sustainability factors
As described above, we consider sustainability factors in our investment practices and business operations. However, at this stage, we do not consider principal adverse impacts (PAIs) of our investment decisions on sustainability factors as outlined in the Sustainable Finance Disclosure Regulation.Given the nature of the business and development stage of our target investments (small early-stage software companies), we consider our current approach to be proportional and adequate for ESG risk monitoring and reporting. Although we have no plan to start considering adverse sustainability impacts of our investment decisions on sustainability factors in the near future, we shall disclose any relevant changes to this on our website.
Remuneration policy
We have not integrated sustainability risks into our remuneration policy. However, interests of our investment managers are aligned with the goal of long-term, sustainable value creation through their share in the carried interest.
The principles above are valid for Karma Ventures S.à r.l. and Karma Ventures II GP S.à r.l., Alternative Investment Fund Managers registered in Luxembourg. The information has been updated as of 08.01.2024.