Sustainability related disclosures

Blue Forest Management GmbH (“Blue Forest”), is an alternative investment fund manager
within the meaning of the German Investment Code (Kapitalanlagegesetzbuch, KAGB) and
as such publishes the following information in light of the consideration of sustainability-
related aspects in accordance with Regulation (EU) 2019/2088 of the European Parliament
and of the Council of 27 November 2019 on sustainability disclosure requirements in the
financial services sector (“SFDR”).

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Art. 3 SFDR –Sustainability risk policies statement

Blue Forest addresses sustainability risks in its investment decision-making process insofar
as relevant. “Sustainability risk” means an environmental, social or governance event or
condition that, if it occurs, could cause an actual or a potential material negative impact on
the value of the investment. During the due diligence on potential investments, Blue Forest
conducts a careful analysis of the investment's exposure to environmental, social, and
governance risks that could impact its value. When identifying a sustainability risk during the
due diligence on potential investments, Blue Forest decides in light of the specific situation
taking due account of the proportionality principle whether it gives up on the investment or
proceeds with the investment alongside appropriate measures to mitigate the relevant
sustainability risk. Blue Forest regularly reviews its policies to ensure that they address new
and emerging risks as well as investors’ concerns.

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Art. 4 SFDR – No consideration of principal adverse impacts

Blue Forest does not consider principal adverse impacts of investment decisions on
sustainability factors. “Sustainability factors” mean environmental, social and employee
matters, respect for human rights, anti-corruption and anti-bribery matters. Blue Forest does
not use sustainability indicators.
The standardized catalog of Key Performance Indicators (KPIs) provided by Annex I of the
regulatory technical standards (RTS) issued under the SFDR is not tailored to the specific
needs of the investment strategy of Blue Forest.
In many instances, data will be insufficient for analyzing PAI, and on occasions where data is
obtainable, it tends to offer little in terms of comparability and fails to provide additional
insights for Blue Forest. Therefore, collecting data on PAI will not only increase the
administrative burden and costs but also fail to provide a new perspective for Blue Forest.
Blue Forest is open to considering PAI in the future if it becomes evident that doing so would
significantly enhance the ability of Blue Forest to identify and mitigate possible adverse
impacts of the investments while maintaining operational efficiency and cost-effectiveness.

 

Art. 5 – Remuneration Disclosure

As a registered alternative investment fund manager within the meaning of the KAGB, Blue
Forest does not have and does not need to have, a remuneration guideline or policy in
accordance with the requirements of the KAGB. Sustainability risks are not considered with
respect to the determination of remuneration.

Art. 10 SFDR – Sustainability-related information about financial products that
promote environmental or social characteristics

Blue Forest Management GmbH (“Blue Forest”), is the alternative investment fund manager
of Blue Forest TAIGA GmbH & Co. KG (“Blue Forest TAIGA”), within the meaning of the
German Investment Code (Kapitalanlagegesetzbuch, KAGB) and as such publishes the
following information in light of the consideration of sustainability-related aspects in
accordance with Regulation (EU) 2019/2088 of the European Parliament and of the Council
of 27 November 2019 on sustainability disclosure requirements in the financial services
sector (“SFDR”).

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Summary

This financial product promotes environmental or social characteristics but does not have as
its objective a sustainable investment. The promoted characteristics are investment
restrictions. 100% of the investments will be in line with its investment strategy and
investment restrictions.
No reference benchmark has been designated to attain the environmental or social
characteristics promoted by the financial product.

Zusammenfassung

Dieses Finanzprodukt bewirbt ökologische oder soziale Merkmale, strebt aber keine
nachhaltigen Investitionen im Sinne der Definition des Art. 2 Nr. 17 SFDR an. Bei den
beworbenen Merkmalen handelt es sich um Ausschlusskriterien. 100 % der Investitionen
werden im Einklang mit der Anlagestrategie und den Anlagebeschränkungen getätigt.
Es wurde kein Referenzwert benannt, um die mit dem Finanzprodukt beworbenen
ökologischen oder sozialen Merkmale zu erreichen.

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No sustainable investment objective

This financial product promotes environmental or social characteristics but does not have as
its objective sustainable investment.

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Environmental or social characteristics of the financial product

The promoted characteristics of this product are investment restrictions:
Blue Forest TAIGA shall not invest, guarantee, or otherwise provide financial or other
support, directly or indirectly, to companies or other entities:
a) whose business activity consists of an illegal economic activity (i.e., any
production, trade or other activity, which is illegal under the laws or regulations

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applicable to the Partnership or the relevant company or entity, including without
limitation, human cloning for reproduction purposes); or
b) which substantially focus on:
i. production of and trade in tobacco and distilled alcoholic beverages;
ii. production of and trade in weapons and ammunition of any kind, it
being understood that this restriction does not apply to the extent such
activities are part of or accessory to explicit European Union policies;
iii. any activities related to controversial weapons (e.g. anti-personnel
mines, cluster munitions, chemical weapons and biological weapons);
iv. casinos and equivalent enterprises;
v. production or trade of pornographic material or business activities
related to prostitution; or
vi. the research, development or technical applications relating to
electronic data programs or solutions, which aim specifically at
supporting any activity referred to under items (i.) to (v.) above and/or
internet gambling and/or online casinos.

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Investment strategy

Blue Forest TAIGA intends to seek long-term capital appreciation through equity and quasi-
equity investments in early-stage technology companies with a focus on deep tech across
different industries, primarily in Europe and selectively in Asia and North America.

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Policy to assess good governance practices of the investee companies

As part of the due diligence and ongoing investment management, the investment team will
review whether a potential investee company has good governance practices in place. This
might include using ESG (environmental, social, and governance) criteria to evaluate
companies' performance in areas such as labor practices, human rights, and corporate
governance, conducting due diligence on investee companies to assess their management
structures, employee relations, and tax compliance, engaging with investee companies
through to encourage improvements in governance practices if necessary. The intensity of
the assessment is carried out in accordance with the principle of proportionality. Where the
manager sees higher risks of a non-compliance, they will intensify the audit.

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Proportion of investments

 

Blue Forest TAIGA will invest fully in line with its investment strategy and investment
restrictions. Blue Forest TAIGA will not invest a portion of its capital in any other asset class.

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Monitoring of environmental or social characteristics

The investment team of Blue Forest TAIGA will initially and continuously monitor whether the
investment restrictions are abided by and whether the investment falls within the investment
policies. Blue Forest TAIGA will not make any investment in the excluded sectors unless
previously approved by the advisory committee. Therefore, the achievement of the promoted
ESG aspects – no investment within the excluded sectors – can be tracked in a simple way.

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Data sources and processing

Blue Forest TAIGA receives data provided by the portfolio companies as part of the due
diligence process and at regular intervals after the investment. Where necessary or
beneficial, Blue Forest TAIGA also makes use of publicly available data. Data processing is
exclusively internal and DSGVO compliant. Estimates of data are not made.

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Limitations to methodologies and data

Blue Forest is partly reliant on the information provided by portfolio companies during the due
diligence process. Moreover, in the post-investment phase, Blue Forest is reliant on the
company’s reported data. In both cases, complete data may not always be available due to
the nature of the investments. The information is verified only if and to the extent
misrepresentations are suspected.
Since Blue Forest TAIGA’s investments are made for a multi-year investment period, Blue
Forest places a high priority on establishing a trusting working relationship with the portfolio
companies to ensure that data is submitted reliably and completely and that the above
restrictions are met.

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Due Diligence

Blue Forest considers the promoted ESG aspects when sourcing new portfolio companies for
Blue Forest TAIGA and during the due diligence on targeted portfolio companies. The due
diligence is performed by obtaining all information relevant to Blue Forest TAIGA using a due
diligence questionnaire, which is then reviewed internally. If necessary, further specific
information is also obtained from the potential portfolio companies, should this still be
necessary after the detailed questioning. The due diligence process is not externally
monitored.

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Engagement policies

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Blue Forest TAIGA invests in the portfolio companies for a period of several years. Therefore,
Blue Forest makes it a priority to establish and maintain a trusting working relationship with
the portfolio companies in order to continuously comply with the investment restrictions. Blue
Forest thus also intends to establish or strengthen the consideration of sustainability risks at
the portfolio level. Blue Forest is in constant dialogue with the portfolio companies, but as a
venture capitalist without majority ownership, the influence Blue Forest can exert on the
portfolio companies is limited.

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