Responsible Ownership Statement
TowerBrook is committed to responsible ownership. This means sourcing, investing and managing investments in a way which is consistent with TowerBrook’s values, and holding ourselves and our portfolio companies accountable to our investors, their beneficiaries and, more widely, the communities in which we operate. We seek to make a meaningful and lasting contribution to the stakeholders in our business and to the places in which we work and live.
We identify and consider responsible ownership risks and opportunities throughout our investment process. We are prepared to invest in imperfect businesses in order to help build them into better businesses. There are some areas we exclude. We will not invest in companies whose business is tobacco, armaments or sexual exploitation: and we will not invest in companies that we know are involved in violations of internationally recognised human rights or exploitative, discriminatory or harmful practices without a plan for remediation.
In addition to our commitment to comply with all applicable laws and regulations, we strive to achieve the highest standards of ethical conduct in our own firm and expect our portfolio companies to do the same.
Building on the established framework of environmental, social and governance (ESG) considerations, we describe TowerBrook’s approach to responsible ownership in terms of three Ps: planet, people and partnership – all of which contribute to delivering the fourth P – performance.
We work to ensure that we at TowerBrook, and our portfolio companies, incorporate environmental sustainability practices into our operations. We seek to mitigate the environmental impact of our own operations when possible, and we encourage our portfolio companies to proactively manage their environmental footprint. We promote awareness of environmentally efficient, effective and economic practices amongst our portfolio companies.
We expect every member of the TowerBrook team to exemplify the highest standards of ethical conduct and to act with regard for the wellbeing, health and safety of others. We encourage the development of practices, both in our firm and at our portfolio companies, that support an engaged, healthy, safe, and productive workforce. We are committed to comply with applicable international, national and local labour laws and workplace health and safety laws and standards, and expect our portfolio companies to comply as well.
We promote and support a diverse and inclusive workforce that embodies integrity, teamwork and respect for others and encourages new ideas and perspectives. We seek to encourage diversity in, and the development of, our people through recruitment and retention programmes as well as through training and mentoring. We expect our partners, employees and other stakeholders to treat others fairly and without prejudice in respect of gender, race, ethnic or national origin, socioeconomic status, immigration status, age, religion, sexual orientation or disability.
We respect the human rights of those affected by our investment activities and seek to ensure that our investments do not support companies that use child or forced labour or maintain discriminatory practices. We partner with our portfolio companies to ensure that, where applicable, their suppliers adhere to ethical practices and respect human rights, including in respect of working conditions, child labour, and forced labour. We also engage with our supply chain to ensure our suppliers are not violating human rights.
For TowerBrook, the social aspect of responsible ownership extends to community engagement. Since 2006, a proportion of the profits of our business has been allocated to the TowerBrook Foundation, which works with a wide range of charitable causes introduced by members of the TowerBrook team.
We approach governance as a true partnership with the management teams to whom we entrust the direction and development of TowerBrook’s portfolio companies.
In addition to implementing effective and fit-for-purpose governance and reporting structures, we require our portfolio companies to adopt clearly articulated governance principles designed to ensure that their approach to social, environmental, and ethical issues is consistent with our commitment to the values of responsibility, integrity and sustainability. Just as we expect our portfolio companies to rigorously manage enterprise risks, we monitor their efforts to track ESG risks and to identify and act on ESG value creation opportunities.
In each of our portfolio companies, the Board and relevant Board committees meet at least annually to ensure that the company’s ESG activities are adequately led and monitored. We encourage clear, accurate, timely and transparent activity reporting affecting all material aspects of our portfolio companies, including material ESG aspects. Should any material ESG issue arise with our existing portfolio companies, we will work closely with their management teams to seek an appropriate outcome.
We design appropriate financing structures to ensure that our portfolio companies will be able to meet all their obligations, including during challenging trading conditions. This means that levels of debt will typically be set conservatively to ensure that companies can operate robustly, even in turbulent economic circumstances.
As investors, we seek to strengthen businesses, helping them to improve their performance and increase their value. That means ensuring alignment on the strategy for value creation, agreeing on clear objectives and deliverables, setting appropriate metrics to measure progress, and supporting management with strong, value-adding Boards as well as with TowerBrook’s Portfolio Group.
At TowerBrook, we take the view that values are inextricable from value. Responsible ownership is not only the right way to conduct our business: it can also help deliver better long-term returns for our investors.
We are committed to transparency within our firm and with our portfolio companies, reporting to them annually on our responsible ownership performance.
Management of our Responsible Ownership Programme
We take steps to ensure that this statement and our corresponding practices are understood and shared across the TowerBrook team, our portfolio companies, key service providers and other stakeholders. We have formed a Responsible Ownership Committee, composed of senior TowerBrook professionals, that is tasked with the management and oversight of our Responsible Ownership Programme. We keep this statement, and our monitoring of the ways in which it is implemented, under continuous review.
This Responsible Ownership Statement applies to all private equity investments made by TowerBrook for which TowerBrook has control or significant influence (“portfolio companies”). In cases where TowerBrook is a minority investor, where other circumstances impact TowerBrook’s ability to assess, set, or monitor ESG-related performance goals, or where we identify material ESG issues that cannot reasonably be addressed, we may not necessarily be able to fully implement this Responsible Ownership Statement. In such cases, TowerBrook will make reasonable efforts to encourage consideration of relevant ESG-related principles by the investee company.