Den Sociale Kapitalfond At the same time as the annual report, KS is launching the foundation’s impact report for 2022, which shows progress on a number of important target figures for the work with sustainability. In several areas, the fund and its portfolio companies have progressed further than planned on the set objectives. Overall, the portfolio companies both improved their financial performance and at the same time delivered significant results on a number of ESG parameters.
2022 was a good year, with the fund continuing its positive development. We are very pleased that the fund delivers a profit of DKK 43 million and a total portfolio return for the fund’s preliminary five-year life of 37% (gross IRR). The results reflect value gains generated through growth and bottom-line improvements in the nine companies that made up the fund’s portfolio in 2022, as well as two successful divestments of the companies Refurb and HITSA. During the year, we also made three new investments in WaterCare, BM Silo and Tolstrup
Lars Jannick Johansen
Impact report 2022: Social responsibility contributes to the bottom line
Private equity competencies in growth and business development combined with special expertise in social sustainability and ESG are at the core of Den Sociale Kapitalfond Invest’s work with investments in Scandinavian SMEs. The fund has a special focus on strengthening inclusion and improving opportunities for vulnerable people who either have physical, mental or social barriers to participate on ordinary terms in the labour market, in the education system or are otherwise marginalised. The impact report shows that 20% of all employees in the fund’s portfolio companies on average come from the fringes of the labour market, which is far above the level for SMEs in Denmark in general.
In 2022, the portfolio companies committed to joining the Science Based Targets Initiative, and are thus working to set climate targets in accordance with the Paris Agreement in a desire to actively contribute to energy reduction and the green transition in general. This applies, for example, to the company Koatek, which invests in solar cells to increase sustainable energy and reduce CO2 from production, recycles and uses recycled packaging and ensures the recycling of all surplus material.
At the same time, the portfolio companies have all committed to adhering to the UN Global Compact’s 10 principles in their work to strengthen human rights, labour rights and anti-corruption. Increased transparency, comparability and quality in sustainability reporting are important elements in the fund’s work with social investments. All portfolio companies report annually on sustainability, and in 2022, Den Sociale Kapitalfond Invest established a reporting platform where portfolio companies are helped to become industry leaders in the ESG area.
We believe in transparency in our work with sustainability, which is why we share both our successes and challenges. This is the third year that we report on ESG key figures in the fund, and this year all portfolio companies have made their own impact reports. We are currently experiencing a great deal of momentum among SMEs around social responsibility and ESG in general, and we can see that the combination of private equity competencies and special ESG competencies is an essential key to success
Lars Jannick Johansen
Den Sociale Kapitalfond Invest is in the process of raising the next fund of DKK 500 million, and is experiencing great investor interest in this connection.