2023 EmergeVest Sustainable Value Creation Report

SUSTAINABLE VALUE CREATION REPORT

ABOUT THIS REPORT

This is EmergeVest’s 2023 Sustainable Value Creation Report, summarizing the firm’s approach, stewardship and environmental, social and governance (ESG) investment integration. This report is designed to be updated annually and will highlight key topics that are important to our business and stakeholders. All data in this report is as of 31 May 2023, unless otherwise noted. For additional information, please visit EmergeVest.com

EmergeVest ESG Highlights

100%

of investments undergo ESG due diligence

29%

of Females in the Investment Committee of EmergeVest

of Companies supported to measure GHG emissions

76%

Preqin: ESG transparency rating

29% 15%

CO2 reduction at portfolio companies within 12 months (between 2021 and 2022)

100% Committed Approved Endorsed Signatory

ILPA Diversity in Action initiatives

Science Based Targets of our Portfolio Companies in the logistics sector

of United Nations Principles for Responsible Investment (UN PRI)

Reduction in Scope 1 CO2 emissions at portfolio companies within 12 months (between 2021 and 2022)

Initiative Climat International (iCl) committments

The EmergeVest Company Overview

EmergeVest was formed in 2013 and is a global investment firm with US$850m+ of AUM that seeks to build great businesses, provide innovative capital solutions and generate value for all stakeholders.

Core Business Strategy

Cross-border mid-market growth buyouts

Office Locations

Hong Kong

Singapore London

EmergeVest engages in responsible investment because we believe that environmental, social and corporate governance (ESG) issues can affect the performance of investment portfolios across various degrees. EmergeVest recognizes that aligning investment practices with these principles can better match investors with the broader objectives of society.

EmergeVest sees its responsibility to beneficiaries as going beyond simply generating financial returns, to also ensuring the sustainability of those returns and the contribution to a stable, inclusive and environmentally friendly economy. This approach respects our fiduciary duty, while acknowledging that responsible, diverse and inclusive businesses tend to be more successful.

EmergeVest commits to a responsible investment approach that values people, culture, reducing our carbon emissions and the ‘doing the right thing’ ethos, aiming to create an impact through responsible investments and extending corporate responsibility to all stakeholders.

Welcome

Heath Zarin Founder, Chairman & CEO

At EmergeVest, we strive to ensure that the investments we make are not only profitable but also socially responsible. We understand that the decisions we make today can have a direct effect on the world around us, and we are committed to utilizing our resources in a way that will create a positive environmental, social and economic impact.

This is why we have created our Sustainable Value Creation Report for 2023. This report outlines the various initiatives we have taken in order to ensure that our investments are sustainable, and that our portfolio companies are committed to making a positive impact on the world.

Since EmergeVest was founded 10 years ago, we have prioritised sound ESG principles. In 2020, we took a pivotal step forward by institutionalizing these principles into a formal ESG program. This initiative included the establishment of our ESG policy, the integration of ESG into our investment processes and the hiring of a dedicated ESG resource.

In 2021 we hired a Managing Director - Head of Sustainability who is also a member of the Investing and Sustainability Committees of EmergeVest. She is responsible for assessing ESG risks and opportunities during due diligence. She also works on identifying materiality and defining ESG strategies for our portfolio companies, measuring progress with key ESG indicators. Her function also ensures ESG considerations are integrated throughout the investment cycle and leads the EmergeVest ESG reporting.

In a continued effort to solidify our commitment to sustainable investment, EmergeVest became a signatory of the United Nations Principles for Responsible Investment (PRI) in 2020 and of the Institutional Limited Partners Association (ILPA) Diversity In Action in 2021.

In November 2021, both EmergeVest and our largest portfolio company EV Cargo joined the CALSTART delegation at COP26 in Glasgow and endorsed the MOU at the summit to support Zero Emissions Heavy and Mid Vehicles to promote decarbonization in the logistics sector. At COP 27 in Egypt we presented the Decarbonisation Roadmap of our flagship portfolio company EV Cargo.

EmergeVest has taken many steps to ensure that our portfolio companies are developing in a sustainable manner. We have set material targets for all our portfolio companies in the logistics sector to reduce their emissions, use renewable energy sources, and invest in projects that will benefit the environment by reducing air emissions, waste, single use plastics and energy consumption among other key material topics.

We have also put in place measures to ensure that our companies are measuring, monitoring and reporting on their environmental, social and governance impact. We have invested in an IT tool to account for CO2e emissions from our logistics portfolio companies and we are following the Global Logistics Emissions Council methodology that is widely accepted in this sector.

Dr. Virginia Alzina Managing Director Head of Sustainability

Sustainablity Overview

EmergeVest’s overall approach to responsible investment involves integrating ESG issues into our investment analysis and decision-making processes, our policies and practices and our disclosure requirements. This approach is embedded within our investment and growth thesis, as well as our portfolio management strategy, the EmergeVest Operating System (EVOS).

EmergeVest is committed to responsible investment practices and upholding high standards in its business operations. Our policies focus on addressing climate change, promoting diversity and inclusion, adopting responsible investment practices, operating in accordance with ethical standards and fostering collaboration and transparency in the private equity industry.

We have implemented a comprehensive ESG policy since 2020, which outlines the integration of ESG processes during the investment process. This policy is anchored on robust investment

principles that EmergeVest consistently applies when evaluating all investment opportunities and executing post-investment plans for portfolio companies. In addition to the ESG policy, in 2021 we established an equity, diversity and inclusivity policy. Our investment professionals are mandated to adhere to and comply with both policies, as well as to our Code of Conduct for employees, ensuring a steadfast commitment to upholding our core values and strategic investment approaches. We regularly update our policies to include the latest changes in the ESG landscape.

Responsible Investment Commitments

EmergeVest has made several major responsible investment commitments that reflect our dedication to sustainability, diversity and environmental stewardship:

2020

United Nations Principles for Responsible Investment

In 2020 we became signatory to the United Nation’s Principles for Responsible Investment (UNPRI), and its 6 Principles. EmergeVest recognizes the importance of transparency and the role it plays in responsible investment.

By becoming a signatory, EmergeVest is committed to the following six principles for responsible investment:

Principle 1

We incorporate ESG issues into investment analysis and decision-making processes.

Principle 3

We seek appropriate disclosure on ESG issues by the entities in which we invest.

Principle 5

We work together to enhance our effectiveness in implementing the Principles.

Principle 2

We are active owners and incorporate ESG issues into our ownership policies and practices.

Principle 4

We promote acceptance and implementation of the Principles within the investment industry.

Principle 6

We report on our activities and progress toward implementing the Principles.

Responsible Investment Commitments

These commitments reflect EmergeVest’s broad-based approach to responsible investment, encompassing not only environmental sustainability but also social equity and good governance.

By doing so, EmergeVest seeks to align its investment strategies with the broader objectives of society, while also meeting its fiduciary responsibilities to its beneficiaries.

2021

Institutional Limited Partnership Association Diversity in Action

2022

Private Equity Action on Climate Change Initiative Climat International

As signatories of the Institutional Limited Partners Association (ILPA) Diversity in Action initiative, EmergeVest has pledged to foster greater diversity and inclusion within the private equity industry. This commitment involves both internal practices, such as recruiting and promoting diverse talent within the organization, and external practices, like considering diversity in due diligence and investing in diverse managers and companies.

EmergeVest joined iCI on 27 July 2022. Private markets are an integral component in the global economic engine, facilitating sustained growth across industries and market sectors.

In light of this, the iC International’s clarion call is clear: namely, that the global private markets industry does its part by leveraging tried-andtested methodologies to analyze and mitigate carbon emissions and exposure to climate-related financial risks in their portfolios.

2021

Memorandum of Understanding

2021

Driving Ambitious Corporate Climate Action Zero Emissions Medium Heavy Duty Vehicles Science Based Targets

As signatories of the Zero Emissions for Medium Heavy-Duty Vehicles (MOU ZE-MHDV) since 2021, EmergeVest is actively working to accelerate the transition towards zero-emission medium and heavyduty vehicles. We are not only making a commitment to invest in companies that follow this direction but also actively lobby others, including the US government, to sign this Memorandum of Understanding (MOU) as well. This Global Drive to Zero MOU is an ambition with an interim goal targeting 30% of sales of new MHDVs to be zero-emission by 2030, and a full transition of new MHDVs to zero-emission by 2040.

We supported joining the Science Based Targets initiative in 2021 for our portfolio companies, an initiative which provides companies with a clear pathway to reducing greenhouse gas emissions.

Investing Responsibly

and with purpose

We value people, culture and doing the right thing. We believe that diverse and inclusive businesses are more successful. We believe responsible investments should make an impact. We believe that corporate responsibility extends to all stakeholders.

As institutional investors, we have a duty to act in the best long-term interests of our beneficiaries. In this fiduciary role, we believe that ESG issues can affect the performance of investment portfolios (to varying degrees across companies, sectors, regions, asset classes and through time). We also recognize that applying these principles may better align investors with broader objectives of society.

Sustainability Targets

EmergeVest promotes the incorporation of ESG into investment decision-making. Sustainable, responsible and impact investing remains at the heart of EmergeVest’s investment and growth thesis. Our approach is summarized in a Business Combination Criteria: Targets with focus on sustainability. On the back of EmergeVest’s UN PRI pledge we intend to focus on either acquiring targets that already have a strong focus on ESG, or targets where our team believes that ESG can be implemented as part of our value-add process.

EmergeVest Operating System

EmergeVest’s approach to portfolio management is called the EmergeVest Operating System (EVOS). EVOS is key to our success, providing a unique investment approach to generate sustainable value creation. Utilizing our knowledge, experience and strategic global position, we have created a tried and test framework, tools and process to facilitate and support growth and transformation. ESG leadership is a key driver of overall EVOS success, including ESG considerations ranging from people and planning to operational excellence. ESG is viewed as an enabler of investment success. All of this is driven by the EVOS strategic plan.

Active Ownership

EmergeVest has made includes integrating ESG issues into investment analysis and decision-making processes and ESG stewardship in portfolio companies. More specifically, with respect to stewardship (active ownership) of portfolio companies, EmergeVest has supported the material assessment of portfolio companies, choosing relevant ESG issues, setting measurable objectives and targets, and tracking results. Specifically, we have been very active tracking several of the material environment topics and in particular climate change.

Investment Integration

At EmergeVest, we believe that incorporating ESG topics into all stages of the investment process is essential.

We take ESG factors into account in our fundamental, bottom-up analysis because we recognize the importance of understanding relevant ESG risks and identifying ESG opportunities. ESG analysis also enables us to engage with investee companies and promote improved ESG standards that may contribute to positive environmental and societal outcomes.

Our structured ESG Health Check, in conjunction with our proven investment process, gives us a strategic advantage in identifying potential risks and opportunities. This combination yields a detailed roadmap, pinpointing specific areas where we can enhance value within our portfolio companies.

Investment Approach

ESG factors are seamlessly woven into EmergeVest’s investment process, as detailed in our ESG Policy. In response to the everchanging ESG landscape, we constantly refine our ESG integration processes. Our focus is on comprehending and fulfilling aspirations for ESG integration and stewardship, working collaboratively with relevant stakeholders to achieve results.

Integration of ESG analysis is crucial and forms a core part of our screening process before investing in a company, underscoring the responsibility of our investment professionals.

A dynamic, forward-looking approach: The trajectory of an investment’s ESG profile can be as important, or more so, than its current state.

Active engagement over exclusion: We believe in driving outcomes through direct engagement with our investments, rather than relying on exclusion lists.

Investment approach: EmergeVest has built its track record on strong, bottom-up investing, driven by fundamentals and a longterm risk management approach that considers an increasing set of sustainability factors. We recognize that ESG risks are inherently long-term in nature. Our ESG integration process captures material risks that may affect a company’s performance within our investment timelines and beyond if the investment case is deemed to be impacted from a forward-looking perspective.

ESG Committee

The EmergeVest Sustainability Committee was formally established in September 2022. The committee is responsible for providing oversight of the ESG policy, ESG integration and stewardship-related strategies and programs and ensuring that EmergeVest complies with its obligations as a signatory to sustainability-related memberships and commitments.

Katrina Yu Head of Administration

Heath Zarin Chairman & CEO

Gary Edwards Managing Director

Lu Wang Director Craig Sears-Black Operating Partner

Dr. Virginia Alzina Managing Director Head of Sustainability

The ESG committee at EV boasts a diverse array of expertise: Heath Zarin, the CEO, brings a comprehensive strategic vision; Virginia Alzina is a key player with her expertise in overall ESG strategy and vast experience in the sector; Gary Edwards contributes deep insights from his finance background;

Lu Wang offers specialized knowledge in investment analysis and strategy; Craig Sears-Black enriches the team with his extensive experience in technology; and Katrina Yu adds valuable perspective with her focus on labour standards.

ESG Transparency Rating

Preqin is a leading provider of data, analytics and insights for the alternative assets industry. Preqin provides comprehensive data and insights on ESG factors in the alternative assets industry. Its research and analytics covers various aspects of ESG integration and reporting in private equity, venture capital, hedge funds, real estate, infrastructure, private debt and natural resources sectors.

2021 ESG Transparency

Global Median 5%

2022 ESG Transparency

Global Median 5%

16% 76%

In 2021 we obtained an initial score of 16% and we worked hard to improve on several of the non financial indicators.

3 of 16 Firm Governance Indicators

3 of 12 Portfolio Governance Indicators

0 of 9 Asset Governance Indicators

At the beginning of 2023 our score improved on 28 out of the 37 data points and we obtained a 76% ESG transparency rating, that´s an impressive 60% improvement.

13 of 16 Firm Governance Indicators

8 of 12 Portfolio Governance Indicators

7 of 9 Asset Governance Indicators

Transition to a Low Carbon Economy

At EmergeVest, we recognize the profound impacts of climate change on our planet, society and the global economy. As a responsible investment firm, we are committed to addressing the urgent challenge of climate change and contributing to the global transition towards a sustainable, low-carbon future.

We believe that taking action on climate change is not only a moral obligation but also a business imperative. By integrating climate considerations into our investment strategies and decision-making processes, we aim to reduce risks, enhance long-term value and create positive environmental outcomes for our portfolio companies, investors and communities. To demonstrate our commitment, we have committed to:

Integrate Risk Assessments Support Portfolio Companies

Integrate climate risk assessment and management into our due diligence process, investment decision-making and ongoing portfolio company monitoring.

Support our portfolio companies in setting and achieving meaningful climate-related goals and targets, including reducing greenhouse gas (GHG) emissions, improving energy efficiency and increasing the use of renewable energy sources.

Encourage Transparency

Encourage transparency and disclosure of climate-related risks, opportunities and performance metrics, in line with recognized global standards such as the Task Force on Climate-related Financial Disclosures.

Share Best Practices Review and Update

Collaborate with our investors, peers and other stakeholders to share best practices, drive industrywide climate action and advocate for supportive policies and regulations.

Regularly review and update our climate change approach, ensuring that it remains aligned with the latest scientific evidence, technological advancements and international climate agreements, such as the Paris Agreement.

Supporters of the Task Force on

Climate-related Financial Disclosures

We identified climate-related risks and opportunities affecting our investments. Being largely dependent on transportation infrastructure, our industry is notably susceptible to the effects of climate change. Risks include the potential disruptions to operations in ports, roads, and air travel due to rising sea levels, floods, and hurricanes.

Recognizing these risks, we are working diligently to adapt to climate change, prepare for climate shocks, and

Scope 1

EmergeVest has not generated any CO2 emissions under Scope 1 during 2021 and 2022.

The Initiative Climat International (iC International) is a global collaboration between 71 private equity investors who collectively commit to understand and reduce carbon emissions of their portfolios and to secure sustainable investment performance. iC International believes that the consequences of climate change will generate both risks and opportunities for the companies in which they invest, and

mitigate climate risk where we can. Simultaneously, we are identifying opportunities to be more cost-efficient and developing new services for our customers that support their transition to net zero. These efforts reflect our commitment to understanding the intersection of climate issues with our investments and proactively addressing both the risks and opportunities they present.

Scope 2

Our Scope 2 emissions for 2022 were 25 tonnes CO2e for FY2022

recognizes that private equity, with its levers for transformation and growth, has a vital and unique role to play in driving the transition to a zero-carbon, climate resilient global economy, and ultimately achieving the Paris Agreement’s objective of limiting global warming to well-below two degrees Celsius.

In 2023 EmergeVest has participated in the Decarbonizing Working Group of iCI part of the Net Zero working group. We

Scope 3

GHG emissions of EV Cargo are included in table on page 25. Our business travel for the reporting 2 years is 10.5 tonnes of CO2e

have prepared a series of 4 webinars on How to Understand the GHG emissions of the Value Chain of Portfolio Companies. The working group seeks to develop cross sectoral tools, knowledge, webinars and best practices to better educate PE firms and portfolio companies on the topic of Scope 3 emissions, and support portfolio companies’ emissions reduction pathways.

Diversity, Equity & Inclusion

At EmergeVest, we firmly believe that diversity and inclusion are essential drivers of innovation, growth and long-term value creation. We are committed to fostering a diverse and inclusive environment across our organization and within our portfolio companies, recognizing that embracing different perspectives, backgrounds and experiences leads to better decision-making and improved business performance.

Diversity of Investment Committee

To substantiate this belief with action, we track diversity metrics at both the fund and portfolio company levels. For the fund our focus encompasses ownership, the investment committee and professionals. We utilize a comprehensive approach that integrates both quantitative and qualitative information, enabling a nuanced understanding and actionable insights into our organizational diversity.

Gender Summary Metrics

Ethnicity Summary Metrics

Diversity & Inclusion (Continued)

At the portfolio company level, where the fund holds a significant or controlling interest, we extend our focus on diversity metrics to include the Boards of Directors, Board Chairs and Senior Management. This ensures that diversity is deeply ingrained in the leadership and decision-making processes, fostering environments where varied perspectives thrive. To bolster our commitment, we have instituted a robust diversity, equity, and inclusion policy both at the fund and portfolio company levels that addresses recruitment and retention, ensuring that our practices not only attract but also support a diverse range of talents. Moreover, our Code of Conduct is unequivocal, with stringent provisions that cover harassment and discrimination, thereby cultivating a respectful and inclusive work environment. Recognizing the significance of work-life balance in enhancing employee satisfaction and productivity, we have also implemented thoughtful family leave policies that affirm our commitment to supporting our employees through various life stages.

Diversity is deeply ingrained in the leadership and decisionmaking processes.

In a stride towards embodying our dedication to diversity and inclusion, before the close of the 2021 cycle, all Investment Committee staff, as well as executives and senior managers at the fund and our portfolio companies, participated in comprehensive diversity and inclusion training. This initiative saw over 150 staff members from EmergeVest and portfolio companies being rigorously trained over a period of three months, dedicating over 7.5 hours each to cultivate a profound understanding and appreciation of diversity and inclusion practices.

In celebration of International Women’s Day over the past two years, EmergeVest, led by the Managing Director and Head of Sustainability, conducted training sessions on ‘Unconscious Bias’. This initiative was not only directed towards the staff of the fund but also extended to the portfolio company levels, ensuring a wide-reaching impact and garnering diverse insights. Over 50 participants actively engaged in these sessions, making them

a significant step in EmergeVest’s continuous efforts to foster a diverse, equitable and inclusive environment.

The training, titled ‘50 Ways to Fight Bias’, is a comprehensive digital program aimed at empowering all employees to identify and confront bias head-on. Tailored for virtual workshops, the program encompasses a short video that elucidates the most prevalent biases women face and a digital card activity. In this activity, participants in small groups discuss specific bias instances, brainstorm resolutions and are provided with research-supported recommendations. The program is meticulously curated, comprising 12 sets of digital cards, each aimed at different audiences and workplace scenarios, such as one for managers and another focused on biases in hiring and promotions.

Human Rights

Anti-Corruption & Anti-Bribery

We have established robust codes and procedures to prevent corrupt practices. Our policy ensures compliance with the U.S. Foreign Corrupt Practices Act (FCPA) and other pertinent international laws.

Since the introduction of the Guiding Principles (UNGPs) by the UN Human Rights Council in 2011, the emphasis on human rights in responsible investment has grown significantly. Savvy investors have recognized that aligning with these international standards results in enhanced financial risk management.

By embracing these standards, we maintain integrity and ethical conduct in our business dealings. At EmergeVest, we advocate for portfolio companies to align with the UN Global Compact (UNGC) and its 10 principles, emphasizing human rights guidelines. Our portfolio companies, global logistics operators, work with us to identify and mitigate risks of unethical conduct in operations and the supply chain. We align strategies with universal principles on human rights, labor, environment, and anti-corruption, taking action to advance societal goals. We ensure our portfolio companies uphold human rights and share our values.

EU & UN Sanctions Compliance

Anti-Money Laundering

We adhere strictly to the Specially Designated Nationals and Blocked Persons Lists as maintained by the Office of Foreign Assets Control, U.S. Department of Treasury (OFAC). Additionally, we comply with similar sanction lists as mandated by the European Union and the United Nations.

We have put in place a solid policy, along with procedures and controls, to reduce the risks associated with money laundering and terrorist financing.

Since becoming UNGC signatories, our portfolio companies follow an ethical trade policy based on principles 1-6 of the UNGC, ETI Base Code, and Global Reporting Initiative (GRI). Compliance is monitored through internal and external auditing by our Ethical Trade Manager and third parties. An Ethics & Compliance Committee oversees all ethical and social responsibility matters.

Our portfolio companies have a Supplier Code of Conduct reinforcing human and labor rights in the supply chain. Strict

due diligence checks apply to all third parties, including new ones during onboarding and existing ones throughout the relationship.

To address modern slavery, employee awareness is crucial. We provide training to new hires and yearly refresher trainings for all employees to identify and report issues in any part of our business or supply chain.

Collaborative Engagements

At EmergeVest, we understand the value of engaging with investee companies and other entities, both individually and collaboratively. We believe that collaborative engagements can be an effective stewardship tool to help drive prioritized ESG objectives and outcomes, driven by a desire to consolidate efforts and streamline engagement goals. Our aim is to ensure that our contributions are active and meaningful.

United Nations’ Principles for Responsible Investing (UNPRI)

Zero-Emission Medium and Heavy-Duty Vehicles (MOU ZEMH)

Institutional Limited Partners Association

Diversity in Action Initiative (ILPA)

The Initiative Climat International (iCI)

United Nations’ Principles for Responsible Investing

Demonstrating EmergeVest’s commitment to responsible investing, we have been a signatory to the United Nations Principles for Responsible Investing (PRI) since December 2020.

This commitment involves adherence to its six principles of responsible investment, as well as transparency and accountability through the PRI’s annual reporting and assessment process. We remain dedicated to upholding these standards as part of our mandate to maintain a high standard of ESG integration, stewardship and reporting.

EmergeVest works with the PRI Secretariat and other signatories to enhance the effectiveness of implementing the PRI, promoting the acceptance and implementation within the investment industry, regularly reporting on our activities and progress and collaborating with other signatories in policy issues through the platform. EmergeVest actively participated in several initiatives on the UNPRI Collaboration Platform, emphasizing a comprehensive approach to enhance global sustainability practices.

Contributions included engaging with the HKEX Consultation Paper to improve climate disclosures under its ESG framework and participating in the PRI’s response to the ISSB Consultation, aiming to enhance the international applicability of SASB standards. EmergeVest also involved itself in discussions spearheaded by the UK Financial Conduct Authority, focusing on aligning firms’ governance and sustainability-related considerations. Furthermore, we supported a unified investor statement advocating for stronger alignment in regulatory and standard-setting efforts

concerning sustainability disclosure, emphasizing simplicity and coherence in corporate sustainability reporting.

Additionally, EmergeVest contributed to the European Commission’s consultation focusing on ESG ratings and credit ratings, an initiative set to influence legislative actions concerning ESG ratings and sustainability factors within credit ratings. We also played a role in the 2022 Global Investor Statement, emphasizing urgent government action to address the climate crisis and we participated in the ISSB’s consultation on exposing general requirements for sustainability-related financial information disclosures, underlining the necessity of refining and enhancing these directives for improved clarity and efficacy in sustainability reporting.

Our Managing Director Head of Sustainability also attended and participated in the three-day UNPRI Annual Meetings in Barcelona, Spain in the fall of 2022.

Memorandum of Understanding: Zero-Emissions Medium & Heavy-Duty Vehicles

In 2021, at COP 26 in Glasgow EmergeVest and our flagship portfolio company EV Cargo became signatories to the Global Memorandum of Understanding: Zero Emissions Medium and Heavy-Duty Vehicles. (MOU ZEMH).

The logistics sector is a significant contributor to global carbon emissions and, as such, it has a crucial role to play in the fight against climate change. One way to achieve this is through the adoption of zero-emission medium and heavyduty vehicles, which can significantly reduce the carbon footprint of logistics operations. However, the transition to such vehicles requires substantial investments in research and development, infrastructure and policy support.

In 2021, at COP 26 in Glasgow EmergeVest and our flagship portfolio company EV Cargo became signatories to the Global MOU ZEMH. The Global MOU supports countries and companies to aim for 30% of new MHDV sales to be zeroemission by 2030, and a full transition of new MHDVs to zeroemission by 2040. We are advocating for measures that can accelerate the transition to a low-carbon logistics sector. The Global MOU signatories participate in a large knowledgesharing platform to support the implementation of the entire suite of policies, incentives, and investments needed to make the transition to 100% zero-emission commercial vehicles. In 2022, we lobbied the US government to endorse the COP26 Global Memorandum of Understanding on Zero-Emission Medium and Heavy-Duty Vehicles (MHDVs) with a positive result as the US also became a signatory of the MOU.

As a significant player in the global logistics industry, we believe in our role to drive policy changes and support efforts towards decarbonization. We are open to measures such as tax incentives, subsidies, and regulations that promote the use of zero-emission vehicles and infrastructure development.

LIMITED PARTNERS

INSTITUTIONAL ASSOCIATION

Institutional Limited Partners Association Diversity in Action Initiative Commitments:

In support of our commitment to diversity and inclusion, we are proud to endorse the Institutional Limited Partners Association (ILPA) Diversity in Action initiative. This initiative promotes meaningful action to advance diversity, equity and inclusion within the private equity industry

Strive to create a diverse and inclusive workplace culture by implementing policies and practices that promote equal opportunity, prevent discrimination and encourage an inclusive and supportive environment for all employees.

Actively recruit, retain and develop diverse talent at all levels of our organization, ensuring that our workforce reflects the diversity of the communities in which we operate.

Encourage diversity and inclusion within our portfolio companies, supporting their efforts to implement inclusive hiring practices, develop diverse leadership teams and create inclusive workplace cultures.

Collaborate with our investors, peers and other stakeholders to share best practices, drive industrywide diversity and inclusion initiatives, and advocate for supportive policies and regulations.

Regularly measure, monitor and report on our progress in advancing diversity and inclusion, ensuring transparency and accountability to our stakeholders.

Action on Climate Change: Initiative Climat International

The Initiative Climat International (iCI) recognizes that private markets, with their levers for transformation and growth, have a vital and unique role to play in driving the transition to a net zero emissions, climate resilient global economy, and ultimately achieving the Paris Agreement’s objective of limiting global warming to wellbelow two degrees Celsius.

The initiative Climat International (iCI) believes that the effects of climate change will generate both risks and opportunities for the companies in which they invest and recognizes that private markets, with their levers for transformation and growth, have a vital and unique role to play in driving the transition to a net zero emissions, climate resilient global economy, and ultimately achieving the Paris Agreement’s objective of limiting global warming to well-below two degrees Celsius.

The iCI is a collective commitment to reduce carbon emissions of private markets-backed companies and secure sustainable investment performance by recognizing and incorporating the materiality of climate risk. iCI membership currently boats 236 private equity members with US$ 3 trn in assets under management.

For iCI’s members, this implies a commitment to effectively analyze and manage climaterelated financial risk and emissions in their private equity portfolios, in line with the recommendations of the Taskforce for Climaterelated Financial Disclosure in June 2017.

Initiative Climat International (iCI) commitments that EmergeVest has endorsed: 01 02 03

We recognize that climate change will have adverse effects on the global economy, which presents both risks and opportunities for investments.

We will join forces to contribute to the objective of The Paris Agreement to limit global warming to well-below two degrees Celsius.

We will actively engage with portfolio companies to reduce their greenhouse gas emissions, contributing to an overall improvement in sustainability performance.

Trainings delivered to portfolio companies on value chain emissions

Unpacking value chain emissions complexity

Data collection and transparency

ESG Stewardship

at our portfolio companies

During the 2021-22 period, EmergeVest has delineated its innovative approaches to integrating substantive Environmental, Social and Governance (ESG) strategies to meet sustainability value creation objectives.

ESG Assessment Framework

EmergeVest introduced a “Comprehensive ESG Assessment Framework” at our portfolio companies. This initiative is focused on recognizing, evaluating, and prioritizing ESG risks and opportunities across investment portfolios, ensuring alignment with EmergeVest’s sustainability policy and aspirations. Essential processes involved include Materiality Analysis, Stakeholder Engagement, and Risk Analysis, concluding with the meticulous prioritization of relevant topics based on their social and financial impacts. This procedure has cultivated a strategic approach to sustainability, ensuring the effective channelization of resources towards domains of utmost relevance and substantial impact.

Green Logistics Strategy

EmergeVest pioneered the “Development and Deployment of Green Logistics Strategy,” aiming to truncate the carbon footprint inherent in logistics operations. The strategy encompasses the adoption of the Global Logistics Emissions Council (GLEC) framework and the EcoTransIT World (ETW) tool for precise GHG emissions measurement and reporting, coupled with the strategic reduction of emissions through innovative alternatives such as the use of HVO fuel. This initiative has markedly enhanced EmergeVest’s environmental stewardship, yielding remarkable reductions in GHG emissions and contributing significantly towards broader sustainability value creation.

ESG Materiality Opportunities

EmergeVest integrated material ESG risks and opportunities within EmergeVest’s 100-day plans, outlining the environment, social and governance risks and opportunities thoroughly. Each category elucidates specific risks and opportunities, identifying the teams responsible for their successful execution and the processes for diligent monitoring and evaluation.

Logistics Company EV Cargo

We strive to create a diverse, equitable and inclusive workplace enabling opportunities for all.

Materiality Assessments

We aim to reduce our overall CO2e emissions.

Diversity, Equity & Inclusion

We will work only with suppliers that share our values.

EmergeVest has a proactive approach to stewardship within our portfolio companies. By implementing recognized standards and utilizing cutting-edge tools, we promote responsible environmental practices and transparency, ensuring that we are actively contributing to global efforts to mitigate climate change, improving diversity, equity and inclusion and protecting human rights among other material topics.

Greenhouse Gas Emissions

Embedding a culture of emplyee safety and regulatory compliance. We will become fully active in our communities to make a positive impact.

Stakeholder Engagement

We will minimise our waste and avoid single-use plastics.

Our overall goal is to be scope 1 and 2 carbon neutral by 2030.

Materiality Assessments

EmergeVest participated on an impact materiality assessment in 2021 and later in 2022 conducted a double materiality assessment at our logistics portfolio companies with the support of key external consultants.

In 2021, we initiated our impact materiality assessment based on the Principles of Selecting Material Issues in the Global Reporting Initiative (GRI) Standards. We further refined our material topics through stakeholder engagement processes, which included interviews, surveys and workshops with our senior leadership, divisional management teams, employees, suppliers and customers.

15%

Subsequently, in 2022, we collaborated with a third party to conduct a double materiality assessment. This assessment served to deepen our understanding of both our impacts on the world and the impact of material topics on our business, operations and financial planning. The notion of double materiality entails the reporting of a company’s financial impact on its operations, as well as the impact of the company’s activities on society and the environment. This assessment allowed us to refine our sustainability focus areas further, informing the indicators we report on and the data we collect.

We also carried out a financial materiality exercise using global frameworks such as the GRI and the Sustainability Accounting Standards Board (SASB) to understand how relevant topics might affect the performance, position and value of our largest portfolio company EV Cargo. This involved an analysis of the risks inherent to the sector and geographies it operates in, supplemented by an assessment of key global risks, as identified by references like the World Economic Forum Global Risk Report. This exercise concluded with an internal stakeholder session aimed at prioritizing topics from a financial perspective.

The findings from this assessment will help direct our future efforts to our most material topics. These stewardship activities underscore our commitment to responsible investment and engagement with investees or portfolio companies fostering sustainable and positive changes across the board.

35%

Greenhouse

Gas Emissions

EmergeVest implements stewardship at our portfolio companies by actively monitoring and managing greenhouse gas (GHG) emissions, particularly within our largest portfolio company EV Cargo. This commitment aligns with our broader sustainability goals and responsibilities as an investor.

CO2e

We have 100% control over all emissions in our value chain

EmergeVest is dedicated to significantly reducing carbon dioxide emissions within its logistics portfolio companies, recognizing the crucial role businesses play in combating climate change. To ensure scientifically grounded targets aligned with the Paris Agreement, EmergeVest has worked with the Science-Based Targets initiative (SBTi) to approve emissions reduction goals. By adhering to the SBTi framework, EmergeVest demonstrates its commitment to transitioning to a low-carbon economy.

The SBTi collaborates with campaigns like Race to Zero, which aims to achieve net zero emissions by 2050. By aligning its operational strategy with a 1.5°C trajectory, EmergeVest contributes to global climate change mitigation efforts and the transition to a net-zero economy.

EmergeVest utilizes the Global Logistics Emissions Council (GLEC) methodology to assess greenhouse gas (GHG) emissions annually and track progress toward climate objectives. This globally recognized framework ensures accurate calculation and reporting of logistics company carbon footprints. To support carbon reporting, EmergeVest employs EcoTransIT World (ETW), an

emissions calculation tool compliant with the GLEC framework and ISO 14083. ETW enables measurement of GHG emissions across the supply chain, including thirdparty transportation and distribution emissions.

In 2022, EmergeVest conducted a carbon footprint assessment of EV Cargo, focusing on scope 1, 2, and 3 emissions. EV Cargo achieved a 29% reduction in total GHG emissions, from 542,332 tCO2e to 383,844 tCO2e.

2021-2022 GHG Emissions Summary

2022 GHG emissions (tCO2e) 2021 GHG emissions (tCO2e)

Scope 1* 46,726

Scope 2* 1,232

Scope 3 10,903

Scope 3 324,982

Total 1+2 47,958

Total 1+2+3 383,844

Scope 1* 54,425

Scope 2* 1,483

Scope 3 13,010

Scope 3 473,414

Total 1+2 55,908

Total 1+2+3 542,332

* Scope 1 and 2 include emissions from EV Cargo’s acquisitions in 2022.

Green House Gas Emissions (continued)

EmergeVest collaborated with AB InBev to introduce sustainable HVO fuel as a replacement for traditional diesel, resulting in a 90% reduction in vehicle emissions. This initiative contributed to a 14.8% reduction in scope 1 emissions, surpassing the set target. The project received recognition, winning the Best Logistics and Supply Chain Green Initiative Award at The Drinks Business Green Awards. Additionally, EV Cargo accounted for all relevant scope 3 categories in its science-based targets submission.

Overall, EV Cargo achieved a 29% reduction in GHG emissions across all scopes in 2022 compared to the 2021 baseline year. Despite expanding operations with 16 new sites, EV Cargo managed a 14.8% reduction in scope 1 emissions. The adoption of HVO fuel, along with the use of more efficient vehicle models, significantly decreased diesel and LPG consumption. Switching to 100% renewable sources contributed to a 35.1% reduction in scope 2 emissions compared to 2021. Various efficiency measures were implemented to reduce scope 3 emissions. EV Cargo remains committed to reducing GHG emissions annually in alignment with SBTi guidelines.

Scope 1

Scope 2

Scope 3

Direct emissions reduction from reporting company. Indirect emissions reduction from energy purchasing. Indirect emissions reduction from value chain purchasing.

*2022 Data excluding new acquisitions.

Gender & Equality

EmergeVest recognizes that a diverse mix of people creates additional value for the portfolio companies, and this is reflected in our commitment to ILPA Diversity in Action initiatives and the DEI initiatives.

EmergeVest values diversity, as seen in our commitment to ILPA Diversity in Action and DEI initiatives. We support the UN SDGs, including SDG goal 5: gender equality. In 2022, we completed the Target Gender Equality program.

29% in 2021 71% in 2022

On the UN Global Compacts and UN Women International Women’s Empowerment Principles (WEP) Gender Gap Analysis Tool, EV Cargo improved from 29% in 2021 to 71% in 2022

Our efforts to enhance gender equality across portfolio companies have yielded significant results. Our Women’s Empowerment Principles (WEP) Gender Gap Analysis Tool score improved from 29% in 2021 to 71% in 2022. This outperforms the average score of 20 to 25% among analyzed companies, a notable achievement considering the male-dominated logistics industry. Our success stems from implementing policies and practices supported by robust measurement and reporting. To lead in this area, we must address remaining gaps, integrate gender equality into sustainability strategies, and increase transparency with stakeholders.

We emphasize our commitment to SDG 5 by promoting gender equality throughout EV Cargo. One initiative is the Aspirational Women Programme, a 20-week course that fosters confidence and capability in female leaders. Delivered virtually, the program emphasizes community and connectivity, providing participants with mentors for idea-sharing. This initiative aims to increase the number of female leaders within our organization. The first cohort of 15 participants underwent training modules on influence, confidence building, and leadership qualities. They were also challenged to present ESG improvement ideas for their portfolio companies.

In 2022, our CEO received recognition from the UN Global Compact for advancing women in leadership and management positions. The representation of women in management increased from 19% in early 2021 to 31% by 2022. Similarly, women’s representation in EV Cargo’s governance bodies rose from zero to 29%.

The remarkable progress in promoting gender equality by our portfolio companies underscores our ongoing commitment to DEI and creating an improved workplace for all employees. We highly value the feedback received through regular surveys on inclusivity from employees in our portfolio companies. Encouraged by the results, we remain dedicated to our work, ensuring diversity, inclusivity, and equity.

Diversity and inclusivity are integral to our commitment, and we conduct programs like ‘Fighting the Bias’ training on International Women’s Day. These sessions empower our team with enriched perspectives and knowledge, enabling them to navigate the evolving investment landscape with a comprehensive understanding of contemporary ESG trends and practices.

Stakeholder Engagement

Our people are central to EmergeVest’s ability to foster a sustainable, long-term investment environment. To ensure our investment professionals are always at the forefront of ESG developments, we engage in a range of educational activities.

We actively engage with our investors on ESG matters through platforms like one-on-one discussions and quarterly reports, ensuring effective communication. Being a member of iCI and ILPA Diversity In Action, we contribute to industry dialogues on ESG and represent our commitment at various events. Our Managing Director - Head of Sustainability has appeared at prestigious forums such as the HSBC Webinar in 2022 and the ESG Masterclass by the Young Presidents Organization in March 2023. She also participated in COP 27 in Egypt, presenting our decarbonization roadmap, and served as a panelist at the Asian Venture Capital Journal conference in Singapore in November 2022.

Our people are crucial to fostering a sustainable investment environment. To keep our investment professionals up to date on ESG developments, we engage in educational activities like UN PRI annual conferences and courses from the UN PRI Academy. We prioritize continuous learning through external conferences, seminars, and tailored internal training sessions, such as ESG Updates in Regulations, focused on the latest in our sector and regions.

In the logistics sector, we actively participate in industry events, fostering knowledge exchange on ESG with a primary focus on decarbonizing GHG emissions.

We pro-actively engage and share our knowledge beyond our portfolio companies, driving engagement with the customers of portfolio companies and partnering with them for impact deep into the supply chain. By sharing our experience and asking how our portfolio companies can help suppliers and customers improve their own sustainability impact.

ESG Awards & Recognition

AVCJ Private Equity Awards: Responsible Investment

In November 2023, EmergeVest was awarded the Responsible Investment Award at the 36th Annual AVCJ Awards for its work creating Sustainable Value Creation at its flagship portfolio company EV Cargo. The judges were impressed by EmergeVest’s comprehensive approach to measuring and reducing emissions across the entire value chain of EV Cargo, as well as its alignment with the Science Based Targets initiative.

This achievement reflects not only our collective commitment to setting, but also raising the standard for ESG practices in our region. We exemplified clear and direct-action plans for reducing GHG emissions across Scopes 1, 2, and 3, and getting our Science Based Targets approved has allowed us to keep long-term ESG goals in line with our company’s business operations.

EmergeVest Limited

Formed in 2013, we are a global investment firm that seeks to build great businesses, provide innovative capital solutions and generate value for all stakeholders.

We think without limitation. We are operator-led capital allocators. We are personally invested in the success of everything we do. We provide ambitious management teams and founders with access to global institutional capital and expertise through a personal relationship with our team.

We provide investors with access to attractive and differentiated value creation.

We are passionate about the secure and sustainable movement of goods, data and funds across the globe.

We are EmergeVest.

Contact Us at EmergeVest

Head Office

EmergeVest Hong Kong

Suite 2910A, 29/F Skyline Tower

39 Wang Kwong Road

Kowloon Bay Hong Kong

+852 3188 3809

info@emergevest.com

www.emergevest.com

Country Offices

EmergeVest Singapore

80 Robinson Road

#02-00

Singapore 068898

EmergeVest UK

Phoenix House

Oxford Road

Gerrards Cross Buckinghamshire SL9 7AP

United Kingdom

EmergeVest Cayman

Cayman Corporate Centre

27 Hospital Road

George Town

Grand Cayman KY1-9008

Cayman Islands

SUSTAINABLE VALUE CREATION REPORT

2023