ESG CHECKLIST

BACKGROUND
Why? This checklist is to be used to screen for high-level ESG risks in order to scope the ESG Due Diligence
When? Screening Phase
Who? The deal Team

INSTRUCTIONS
a) Fill in yellow cells for each chapter of the checklist.
b) The following chapters:
- Governance,
- Environment,
- Social.
require a high-level evaluation of:
- Relevance to the target Company: Likelihood of the ESG topic to represent a material risk or opportunity given the characteristics of the
target Company (business sector and type of operations).
- Maturity of the target Company: Degree of awareness and understanding of the target Company regarding risks and opportunities related to
each environmental, social or governance aspect and of the management capacity to address such issues.

The high relevance / poor maturity aspects would need to be further assessed during the ESG Due Diligence.
The contents of this checklist are based on a series of international reference documents mainly CDC, the GRI, the SASB, the BVCA, the PRI,
Invest Europe:
http://toolkit.cdcgroup.com/downloads-and-reference-materials
https://www.globalreporting.org/standards/
https://www.sasb.org/materiality/sasb-materiality-map/
https://www.bvca.co.uk/Our-Industry/Responsible-Investment
https://www.unpri.org/investor-tools/private-equity
https://www.investeurope.eu/
ESG CHECKLIST - BUSINESS OVERVIEW
Topic Information
Company name
Industry/ Business sector
Type of operations associated with the business e.g. office,
manufacturing/production, warehousing, logistics etc.
Exclusion list check - as per applicable Fund 3:

Rules & Regulations: Please confirm that the Company does not derive its revenues
from pornography and prostitution, production, sale or distribution of weapons of mass
destruction, artillery and antipersonnel landmines, illegal drugs, polychlorinated
biphenyl and asbestos
Side Letters: Please confirm that the Company does not derive its revenues from
tobacco, palm oil, nuclear power, coal-fired power plants
231 Model
A. Has the company implemented an Organization Model 231?
B. Does the model cover environmental and social aspects?
Sustainability /Non Financial Disclosure Report
A. Does the Company prepare a Sustainability (or Non Financial Information) Report?
Please note that in such Reports it is possible to find some information that may be
used in the compilation of tabs "Environment", "Social" and "Governance".
B. Is the Company subject to the Legislative Decree no. 254 regarding non financial
disclosures (click here for more information on the scope of the Legislative Decree)?
ESG Policy, Environmental Policy, Health&Safety Policy, Social Policy
Does the Company have policies that cover ESG aspects (ESG Policy, Environmental
Policy, Health&Safety Policy, Social Policy)?
Sustainability section on the website
Does the Company publish sustainability information on its website?
ESG CHECKLIST - ENVIRONMENT

ASSESSMENT GUIDANCE
Aspects that can be considered when assessing the relevance of the topic (reported on the left) to the target and the level of maturity.
Level of Maturity of the target
ID Topic Relevance to the Target ID Description/ questions for guidance Note
Company
A. Serious incidents/regulatory breaches regarding environmental aspects. Nature of the incident, improvements
E.1 Regulatory compliance E.1
made/lessons learnt and regulatory action (enforcement/prosecution/fine).
E.2 Natural hazards E.2 Is the Company subject to flood, seismic or other natural hazards?
Carbon emissions
A. Does the Company operate in an energy intensive sector? Does the Company monitor GHG emissions (inclusive of
non directly generated e.g. outsourced logistics, use of final product etc)? Is the production (in particular the carbon
intensive activities) mainly outsourced? Is the company subject to a cap and trade scheme (EU ETS)?
B. Plans or actions to control and/or reduce emissions.
E.3 Carbon emissions/ Climate change E.3
Exposure to climate changes
Could operations be at risk from current/evolving climate change regulation and/or physical changes associated with
climate change (including increased flooding, drought or other severe weather events), for example: business
disruption or damage to assets and production?

E.4 Air emissions E.4 Can the Company operations originate significant emissions to air (e.g. oil&gas, energy, transportation, chemical)?
A. Are the Company operations energy or water intensive?
B. Are there any plans in place to reduce energy consumption, increase percentage of renewable energy in the
E.5 Energy and water management E.5
Company's energy mix?
C. Do the products offered have energy labelling/certifications?
A. Are chemicals/hazardous substances used in the production process?
B. Is management aware of any potential disruption to the supply of chemical/hazardous substances used in the
Chemicals/hazardous substances handling
E.6 E.6 production process through regulatory phase-out (e.g. REACH regulation)?
& supply chain
C. Is the company considering the use of more environmental friendly and safer raw materials/chemicals in the
production process?
A. Does the production process originate relevant quantities of waste or hazardous waste?
E.7 Waste management/ end of life of products E.7 B. Waste management initiatives to minimise or reuse/recycle waste.
C. Are products offered designed in order to reduce their end-of-life footprint?
A. Is there a risk of soil contamination resulting from the activities of the target company?
B. Is the company aware of any former or current soil/groundwater contamination issues at the site(s) and is there a
E.8 Soil&groundwater E.8 need to conduct investigation or remediation activities?
C. Has the company recognised any financial provision in the accounts to address any environmental liability such as
contaminated land/environmental restoration?
E.9 Biodiversity impact E.9 Has the production process an impact on biodiversity (including deforestation and land degradation)?
E.10 Green products E.10 Does the Company offer "green" or "low impact "product lines?
A. Do the products offered by the Company require a relevant amount of packaging (eg. Fragile goods)?
E.11 Packaging E.11
B. Are sustainability criteria considered in the design of packaging?
ESG CHECKLIST - SOCIAL

ASSESSMENT GUIDANCE
Aspects that can be considered when assessing the relevance of the topic (reported on the left) to the target and the level of maturity.
Level of Maturity of the target
ID Topic Relevance to the Target ID Description/ questions for guidance Note
Company
A. Workforce composition (employees, self-employed, trainee, seasonal workers)
B. Do all employees have a formal contract of employment?
C. Turnover rates and talent retention
D. Diversity issues (e.g. diversity on boards, pay gap)
S.1 Human resources S.1
E. Serious labour related complaints/claims/enforcement actions
Workers

F. Freedom of association and collective bargaining

G. Training
H. Benefits provided to employees
A. Is the Company operating in an industry that presents a high risk for health and safety? Are workers exposed to high incidence or high
risk of diseases related to their occupation?
S.2 Health and safety S.2
B. Has the company been subject to enforcement actions by the regulators for breaches of relevant H&S legislation?
C. Is the Company classified as a major risk facility? (ie under Seveso Directive)
Community

A. Community investments, sponsorships, product donations

S.3 Community involvement S.3 B. Formal programmes in place to promote company involvement with the community (volunteering, stakeholder engagement, etc.).
C. Previous NGO/media negative campaigns, community/workforce unrest

A. Product or sector specific regulations (e.g. food safety, pharma GMP, other)
S.4 Consumer safety /product regulations S.4
B. Actions taken to ensure the health and safety of consumers
Customers and products

A. Company's data security policy and IT security management system

B. Sensitivity of information in possess of the Company
S.5 Customer privacy S.5
C. Breaches in cyber security within the last years
D. Substantiated complaints regarding breaches of customer privacy and losses of customer data
A. Requirements for product and service information and labelling
S.6 Fair disclosure and labelling/Fair marketing S.6 B. Incidents of non-compliance concerning product and service information and labelling
C. Incidents of non-compliance concerning marketing communications
S.7 Innovation S.7 R&D investment plans, patents, innovative products and/or services
ESG CHECKLIST - GOVERNANCE

ASSESSMENT GUIDANCE
Aspects that can be considered when assessing the relevance of the topic (reported on the left) to the target and the level of maturity.

ID Topic Relevance to the Target Level of Maturity of the target ID Description/ questions for guidance Note
Roles and responsibilities
A. Has an ESG committee/steering committee been established?
B. Commitment and responsibilities at a senior management level on sustainability.
C. Has a designated reference person for day-to-day ESG matters been assigned?
Policies & Procedures
A. Are ESG Values and principles clearly communicated (e.g.. on the website)?
B. Does the Company have Sustainability or Business Conduct policies? Do polices cover discrimination, and child, forced or compulsory
G.1 ESG systems and processes G.1
labour, health and safety and environmental issues?
C. Are there environmental/health and safety procedures or management systems in place?
D. What is the level of establishment and embedment of procedures?
Monitoring & Reporting
A. What are the arrangements in place for monitoring and reporting ESG issues and performance to senior management/the Board?
B. Does the Company publish an ESG/CSR/Sustainability report or a designated section in the annual accounts?
C. Is there a Sustainability section on the website?
A. What does the organisation currently do to safeguard against illegal practices? Any corporate governance and/or ethical related
employee claims/breaches/ enforcement/litigation action relating to issues such as anti-bribery and corruption, cases of unfair labour
practices, human rights abuses, and other unethical business practices?
G.2 Corruption and business ethics G.2
B. Does the Company make financial or in-kind political contributions?
C. Does the Company participate in public policy development or lobbying activities?
D. Are there any anti-trust issues?
A. Are key suppliers located in emerging markets with high social, human labour, environmental risks?
B. Is the supply chain part of an industry with high social, human labour, environmental risks?
G.3 Supply chain G.3
C. Does the company have a responsible purchasing policy/Code of Conduct for suppliers? Are ESG criteria included in the selection and
monitoring of key suppliers?
ESG CHECKLIST - ENVIRONMENT

ASSESSMENT GUIDANCE
Aspects that can be considered when assessing the relevance of the topic (reported on the left) to the target and the level of maturity.
Level of Maturity of the target
ID Topic Relevance to the Target ID Description/ questions for guidance Note
Company
A. Serious incidents/regulatory breaches regarding environmental aspects. Nature of the incident, improvements
E.1 Regulatory compliance E.1
made/lessons learnt and regulatory action (enforcement/prosecution/fine).
E.2 Natural hazards E.2 Is the Company subject to flood, seismic or other natural hazards?
Carbon emissions
A. Does the Company operate in an energy intensive sector? Does the Company monitor GHG emissions (inclusive of
non directly generated e.g. outsourced logistics, use of final product etc)? Is the production (in particular the carbon
intensive activities) mainly outsourced? Is the company subject to a cap and trade scheme (EU ETS)?
B. Plans or actions to control and/or reduce emissions.
E.3 Carbon emissions/ Climate change E.3
Exposure to climate changes
Could operations be at risk from current/evolving climate change regulation and/or physical changes associated with
climate change (including increased flooding, drought or other severe weather events), for example: business
disruption or damage to assets and production?

E.4 Air emissions E.4 Can the Company operations originate significant emissions to air (e.g. oil&gas, energy, transportation, chemical)?
A. Are the Company operations energy or water intensive?
B. Are there any plans in place to reduce energy consumption, increase percentage of renewable energy in the
E.5 Energy and water management E.5
Company's energy mix?
C. Do the products offered have energy labelling/certifications?
A. Are chemicals/hazardous substances used in the production process?
B. Is management aware of any potential disruption to the supply of chemical/hazardous substances used in the
Chemicals/hazardous substances handling
E.6 E.6 production process through regulatory phase-out (e.g. REACH regulation)?
& supply chain
C. Is the company considering the use of more environmental friendly and safer raw materials/chemicals in the
production process?
A. Does the production process originate relevant quantities of waste or hazardous waste?
E.7 Waste management/ end of life of products E.7 B. Waste management initiatives to minimise or reuse/recycle waste.
C. Are products offered designed in order to reduce their end-of-life footprint?
A. Is there a risk of soil contamination resulting from the activities of the target company?
B. Is the company aware of any former or current soil/groundwater contamination issues at the site(s) and is there a
E.8 Soil&groundwater E.8 need to conduct investigation or remediation activities?
C. Has the company recognised any financial provision in the accounts to address any environmental liability such as
contaminated land/environmental restoration?
E.9 Biodiversity impact E.9 Has the production process an impact on biodiversity (including deforestation and land degradation)?
E.10 Green products E.10 Does the Company offer "green" or "low impact "product lines?
A. Do the products offered by the Company require a relevant amount of packaging (eg. Fragile goods)?
E.11 Packaging E.11
B. Are sustainability criteria considered in the design of packaging?
ESG CHECKLIST - SOCIAL

ASSESSMENT GUIDANCE
Aspects that can be considered when assessing the relevance of the topic (reported on the left) to the target and the level of maturity.
Level of Maturity of the target
ID Topic Relevance to the Target ID Description/ questions for guidance Note
Company
A. Workforce composition (employees, self-employed, trainee, seasonal workers)
B. Do all employees have a formal contract of employment?
C. Turnover rates and talent retention
D. Diversity issues (e.g. diversity on boards, pay gap)
S.1 Human resources S.1
E. Serious labour related complaints/claims/enforcement actions
Workers

F. Freedom of association and collective bargaining

G. Training
H. Benefits provided to employees
A. Is the Company operating in an industry that presents a high risk for health and safety? Are workers exposed to high incidence or high
risk of diseases related to their occupation?
S.2 Health and safety S.2
B. Has the company been subject to enforcement actions by the regulators for breaches of relevant H&S legislation?
C. Is the Company classified as a major risk facility? (ie under Seveso Directive)
Community

A. Community investments, sponsorships, product donations

S.3 Community involvement S.3 B. Formal programmes in place to promote company involvement with the community (volunteering, stakeholder engagement, etc.).
C. Previous NGO/media negative campaigns, community/workforce unrest

A. Product or sector specific regulations (e.g. food safety, pharma GMP, other)
S.4 Consumer safety /product regulations S.4
B. Actions taken to ensure the health and safety of consumers
Customers and products

A. Company's data security policy and IT security management system

B. Sensitivity of information in possess of the Company
S.5 Customer privacy S.5
C. Breaches in cyber security within the last years
D. Substantiated complaints regarding breaches of customer privacy and losses of customer data
A. Requirements for product and service information and labelling
S.6 Fair disclosure and labelling/Fair marketing S.6 B. Incidents of non-compliance concerning product and service information and labelling
C. Incidents of non-compliance concerning marketing communications
S.7 Innovation S.7 R&D investment plans, patents, innovative products and/or services
ESG CHECKLIST - GOVERNANCE

ASSESSMENT GUIDANCE
Aspects that can be considered when assessing the relevance of the topic (reported on the left) to the target and the level of maturity.

ID Topic Relevance to the Target Level of Maturity of the target ID Description/ questions for guidance Note
Roles and responsibilities
A. Has an ESG committee/steering committee been established?
B. Commitment and responsibilities at a senior management level on sustainability.
C. Has a designated reference person for day-to-day ESG matters been assigned?
Policies & Procedures
A. Are ESG Values and principles clearly communicated (e.g.. on the website)?
B. Does the Company have Sustainability or Business Conduct policies? Do polices cover discrimination, and child, forced or compulsory
G.1 ESG systems and processes G.1
labour, health and safety and environmental issues?
C. Are there environmental/health and safety procedures or management systems in place?
D. What is the level of establishment and embedment of procedures?
Monitoring & Reporting
A. What are the arrangements in place for monitoring and reporting ESG issues and performance to senior management/the Board?
B. Does the Company publish an ESG/CSR/Sustainability report or a designated section in the annual accounts?
C. Is there a Sustainability section on the website?
A. What does the organisation currently do to safeguard against illegal practices? Any corporate governance and/or ethical related
employee claims/breaches/ enforcement/litigation action relating to issues such as anti-bribery and corruption, cases of unfair labour
practices, human rights abuses, and other unethical business practices?
G.2 Corruption and business ethics G.2
B. Does the Company make financial or in-kind political contributions?
C. Does the Company participate in public policy development or lobbying activities?
D. Are there any anti-trust issues?
A. Are key suppliers located in emerging markets with high social, human labour, environmental risks?
B. Is the supply chain part of an industry with high social, human labour, environmental risks?
G.3 Supply chain G.3
C. Does the company have a responsible purchasing policy/Code of Conduct for suppliers? Are ESG criteria included in the selection and
monitoring of key suppliers?