ESG

NovaQuest is committed to incorporating consideration of Environmental, Social and Governance (ESG) factors in our investment decision-making process. In addition to being in line with our “One Health” philosophy, we believe that incorporating ESG considerations creates value for our investors by mitigating undue risk and emphasizing long-term sustainability and resilience in our investment portfolio.

To this end, NovaQuest has developed an ESG Policy that outlines our approach to integration and consideration of ESG factors in our investment processes.

The ESG Policy outlines a standard process of ESG diligence and investment decision-making for all product finance and equity investments being contemplated by NovaQuest’s Investment Committees.

The ESG Policy also outlines procedures for engagement and monitoring of ESG-related matters across the portfolio, subject to limitations that may be posed by virtue of NovaQuest’s role in a given transaction.

Through implementation of this ESG Policy, NovaQuest aims to minimize exposure to ESG-related risks and to encourage improvements in ESG performance over time where our position allows us to do so.

EU SFDR Notice

Novaquest Capital Management, L.L.C. (“NovaQuest”) proactively manages operational risk, including ESG considerations, in its investments and has adopted processes and procedures to integrate the assessment of sustainable risks in its investment decision-making process as appropriate. However, NovaQuest does not consider or focus on the “adverse impacts of investment decisions on sustainability factors” as contemplated by European Union Regulation (EU) 2019/2088 on Sustainability-Related Disclosures in the Financial Sector (“SFDR”) as it is not required to do so under SFDR.