Good governance is essential to ensuring FGEN's portfolio achieves its targeted returns. We hold board positions for each of our assets, which are fulfilled by Foresight on our behalf.
Board members work to promote good governance as part of the Fund’s active engagement with projects. As a baseline, we consider the following governance criteria during due diligence and ongoing monitoring of assets:
- Anti-bribery and corruption
- Modern slavery
- Audit and tax practices
- Board composition.
We are in the process of formalising the reporting of governance indicators, and continually add and review indicators to help promote improved performance over time.
| Governance KPI | Measurement |
|---|---|
| Portfolio audits of health and safety practices | % of assets audited |
| Portfolio audits of tax and financial practices | % of assets audited |
| Governance oversight | % of assets which comply with a governance policy and associated documents, that are reviewed on a periodic basis |
| Cyber security(1) | % of assets with cyber security policy in place |
(1) New KPI for 2023/24.
Diversity of SPV directors
To drive progress and increase gender diversity, we will be tracking gender diversity of SPV directors across all of our investments with the intention of proactively increasing the proportion of female board members over time.
Inclusion of ESG in SPV board agendas
While HSE reporting has been formally included in all board agendas for some time, we are now mandating that all board agendas routinely include discussions around ESG matters to drive proactive approaches to ESG going forward.
Modern slavery and human trafficking
Our policy and practices in relation to modern slavery and human trafficking are included in Foresight Group’s Modern Slavery Act statement. The statement sets out Foresight’s approach to services and supply chain due diligence, and recruitment, training and welfare of employees.
CASE STUDY
ENHANCED SCOPE OF MANAGEMENT OPERATIONS ON THE AD PORTFOLIO
This year, the largest operator on FGEN's AD portfolio has been contracted for an enhanced scope of service to improve ESG monitoring and implementation of ESG initiatives. As part of this, a specialist ESG coordinator has been employed by the operator.
Some key areas of the enhanced scope include:
- Environment
- Biodiversity
- Greener farming
- Health and safety reporting
- Community engagement
- Employee engagement
This enhanced scope of activities is particularly beneficial on the AD portfolio which has close ties with the area in which it works and local farming communities.