ADDITIONAL INFORMATION

Information provided by Space Bridge spółka z ograniczoną odpowiedzialnością with its registered office in Lublin, at Tomasza Zana 38 lok. 1003A, 20-601 Lublin, entered in the Register of Entrepreneurs of the National Court Register kept by the District Court Lublin-East in Lublin with its seat in Świdnik, VI Economic Department of the National Court Register under KRS 0000697150, REGON 36838439500000, NIP 7123348365, with a share capital of 5. 000.00 PLN, in connection with the requirements under Regulation (EU) 2019/2088 of the European Parliament and of the Council of November 27, 2019 on disclosure of information related to sustainable development in the financial services sector (SFDR)

1. Preliminary issues
This study has been adopted by the Board of Directors of Space Bridge spółka z ograniczoną odpowiedzialnością, based in Lublin, at Tomasza Zana 38 lok. 1003A, 20-601 Lublin, entered in the Register of Entrepreneurs of the National Court Register kept by the District Court Lublin-East in Lublin with its seat in Świdnik, VI Economic Department of the National Court Register under the number KRS 0000697150, REGON 36838439500000, NIP 7123348365, with the share capital of 5. 000.00 PLN (“ZASI”), i.e. a company authorized as an external manager of alternative investment companies to manage ASI Space Bridge Limited Partnership with its registered office in Lublin, at 38 Tomasz Zana St. lok. 1003A, 20-601 Lublin, entered in the Register of Entrepreneurs of the National Court Register kept by the District Court Lublin-East in Lublin with its seat in Świdnik, VI Economic Department of the National Court Register under KRS No. 0000776210 and NIP No. 7123383870, (“ASI”) in accordance with the Law on Investment Funds and Management of Alternative Investment Funds dated June 23, 2022. (Journal of Laws of 2022, item 1523, as amended), Directive 2011/61/EU of the European Parliament and of the Council of June 8, 2011. on Alternative Investment Fund Managers and amending Directives 2003/41/EC and 2009/65/EC and Regulations (EC) No. 1060/2009 and (EU) No. 1095/2010 (“AIFMD”) and Commission Delegated Regulation (EU) No. 231/2013 of December 19, 2012 supplementing Directive 2011/61/EU of the European Parliament and of the Council with regard to exemptions, general operating conditions, depositaries, leverage, transparency and supervision (“AIFMR”) and pursuant to Regulation 2019/2088 of the European Parliament and of the Council of November 27, 2019, on Disclosure of Information Related to Sustainable Development in the Financial Services Sector (“SFDR”).

The SFDR Regulation is an act that establishes unified regulations for the financial services sector, which address clarity with regard to the introduction of sustainability risks into operations and the consideration of adverse sustainability effects in the operations of participants in the sector, as well as with regard to their presentation of sustainability-related information on financial products.

The information indicated above primarily concerns:

  1. transparency regarding the strategy for introducing sustainability risks into the business in the investment decision-making process,
  2. consideration of the main adverse effects of investment decisions on sustainability factors,
  3. determination of how to ensure the consistency of the financial market
  4. participant’s adopted remuneration policies with the introduction of risks for sustainable development into the business.

2. Article 2 of the SFDR Regulation
ZASI is covered by the SFDR Regulation because it is classified as a financial market participant due to the object of its activities. In doing so, the object of its activities is: management of alternative investment funds and management of portfolios that include one or more financial instruments.

3. Risk for sustainable development

Risks to sustainability are environmental, social, management-related situations or conditions that, if they materialize, could have, actual or potential, a negative impact on the value of investments.

In particular, factors affecting the level of risk include:

  1. climate change due to global warming;
  2. rational use of water resources (both marine and inland);
  3. ecological focus on energy production;
  4. respect for human rights;
  5. adherence to universally recognized norms of labor law (including, most notably, prohibition of child labor, forced labor or prohibition of discrimination);
  6. sustainable and responsible social and territorial development;
  7. ensuring the protection of labor rights;
  8. supporting anti-corruption measures.

The most important objective of ZASI is to take into account the interests of ASI participants and its clients. ZASI takes into account the disposition of sustainability risks, which may be included in the investment process to a non-uniform extent, depending on the strategy, assets and/or portfolio structure of a given ASI. ZASI is authorized to use specific methods and databases that contain information on the prevention of environmental degradation, social responsibility and corporate governance from external analysis companies, or that contain the results of internal research and analysis.

4. Taking into account the main negative effects of investment decisions on the factors of
sustainability

Assessing the risks that are associated with sustainability is a complex matter and may be based on data that relates to ESG. At the same time, this data may be difficult to collect, incomplete, estimated, outdated or materially inaccurate for other reasons.

In the case of investments where there are indications that sustainability criteria may not be met, or such criteria are impossible to establish, it is then that a decision is made to include a particular issuer or exclude it from the permissible ASI focus area.

Once industry standards are developed, in terms of taking into account sustainability risks, as well as with the development of regulations on how to disclose sustainability-related information (primarily due to the entry into force of the technical regulations to Regulation (EU) 2019/2088 of the European Parliament and of the Council of November 27, 2019. on disclosure of information related to sustainability in the financial services sector) during the investment decision-making process in the financial services sector, and at the same time as the availability of sustainability-related data from issuers increases, the sustainability risk management process may undergo changes aimed at bringing it in line with current market standards.

5. Products that promote an environmental or social aspect (or both), or aim at sustainable investments – SFDR Articles 8 and 9

As for the ASIs that are offered by ZASI, none of the ASIs contain elements that promote environmental and social aspects within the meaning of Article 8 of the SFDR Regulation (i.e., “light green products”), nor are they aimed at sustainable investments within the meaning of Article 9 of the SFDR Regulation (i.e., “dark green products”).

The ASI investments that make up the ASI investment universe do not take into account the European Union’s criteria for environmentally sustainable economic activity.

ZASI takes environmental and social criteria into account when making investments. The basis of any investment decision is the three sustainability factors, meaning environment (E), society (S) and responsible corporate governance (G).

Sustainability analysis is combined with an in-depth, financial analysis of the company during the various selection steps. Sustainability analysis during the selection steps is as follows:

Initially, an initial selection of the entire investment universe is made. The analysis is independent of asset classes and applies only to issuers. ESG selection consists of criteria such as:

  • such as sector of activity,
  • global standards and controversy.

Positive criteria such as minimum ESG ratings are also taken into account. They are subject to constant monitoring, while they can be changed or adjusted based on new information and market developments. During the first stage of selection, companies that do not meet the indicated criteria will be eliminated from the investment universe. This is a step that leads to a significant reduction in the original investment universe.

Negative criteria for companies are mainly: controversial weapons, coal, shale gas, tobacco and alcohol.

Negative criteria for countries acting as issuers of government bonds are also distinguished. These criteria include ratification of international agreements (such as the Nuclear Non-Proliferation Treaty, the Paris Agreement on climate change, labor and human rights agreements).

Issuers are then reduced using qualitative analysis. This is an asset class-independent step; it only applies to issuers. With standard corporate analysis, various aspects of sustainability are taken into account. ESG criteria are analyzed in particular detail. The sector of operation, compliance with global standards, and significant controversies are also examined. On a best-in-class basis, companies and countries with the highest ESG standards are selected in the area of the industry or region.

 

7. Implementation of the “do no serious harm” principle
The “do no serious harm” principle is applied to investments under ZASI. It takes into account the European Union’s criteria for environmentally sustainable business activities.