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The ARETE Investment Group considers responsible investing as one of its priorities. For this reason, we have successfully implemented an ESG strategy for the ARETE INDUSTRIAL fund. As a result, we have become one of the first so-called “light green” real estate funds in the Czech Republic.

Responsible and sustainable investment not only brings value to individual investors but also to society. We take pride in being one of the pioneers in the Czech capital market to introduce international standards.

“It is clear that capital appreciation can be achieved in a socially responsible manner. Therefore, our ARETE INDUSTRIAL investment fund evaluates not only financial but also social, environmental, and ethical factors in its investment decision-making process,” explains ARETE’s ESG Manager, Josef Novotný.

The implementation of the ESG strategy is just the beginning. We also aim to further develop and extend our sustainability policy in the future and potentially expand our criteria considered for the fund’s investments.

As a participant in the financial market, we are obliged to report under the European SFDR (Sustainable Finance Disclosure Regulation) directive whether and how we achieve or aim to achieve a sustainable policy. The ARETE INDUSTRIAL SICAV a.s. fund has chosen to support a sustainable finance policy as defined in Article 8 of the SFDR directive.

Taking a comprehensive view on ESG issues in the fund’s investment activities, we address all three letters of the ESG acronym. The letter “E,” representing Environment, involves assessing the impact of companies’ activities (primarily properties, in our case) on the environment. From ARETE Group’s perspective, this includes the use of renewable resources in the ARETE INDUSTRIAL fund’s real estate portfolio and taking active care for its surroundings.

We also focus on meeting social criteria represented by the letter “S” (Social) through collaboration with local stakeholders. For example, we contribute to local development by working with municipalities. The fund’s second pillar in the social area is the proportion of satisfied tenants with long-term lease agreements, as well as the evaluation and selection of tenants with business activities that are sustainable for the local region in the long-term.

The letter “G” (Governance) represents criteria for responsible company management. Our priorities in this area primarily involve full compliance with legislative and regulatory requirements, fair practices, and adherence to ethical standards reflected in the ARETE Group’s Code of Ethics.

The ARETE Group primarily supports sustainability in these areas:
Environment

• We reduce energy demand and carbon footprint of our assets:
  • At least 80 % of the properties in the ARETE INDUSTRIAL fund portfolio must have BREEAM certification rating of “Very Good.”
  • We will install photovoltaic panels on all roofs within our property portfolio where technically feasible.
  • We commit to achieving zero use of electricity produced from fossil fuels by no later than the end of 2050.
  • We are committed to reducing direct greenhouse gas emissions and aim to achieve net-zero emissions by no later than the end of 2050.
• We support biodiversity:
  • Within our group, we will continue our long-term collaboration with organizations that support biodiversity protection. Our support primarily involves providing financial contributions to their activities, cooperation, and consultation during new construction projects.
  • We have committed, as a group, to plant one tree for every 500 square meters of a newly built lettable area.
  • We support the protection of conversation areas and endangered wildlife species.
• Water Resource Protection and Waste Management:
  • We have been working on waste reduction and recycling in the construction of buildings. At least 60% of waste from new construction projects will be designated for recycling.
     

Social

• We care for the health, safety, and well-being of employees and tenants:
  • We regularly ask our tenants and group employees about their satisfaction with their workplace environment. This includes lighting, air circulation and filtration, adequate breakout areas, and collaboration on monitoring and reducing CO2 emissions and other sustainability factors.
  • We commit to conducting an annual tenant and employee satisfaction survey.
  • We create sufficient breakout areas in all ARETE Group spaces.
  • Within the group, we promote long-term collaboration with tenants. For ARETE INDUSTRIAL, the fund’s goal is to enter into long term lease agreements for a period of five or more years and to maintain occupancy levels within the fund’s portfolio at a minimum of 90 %.
• We support local communities:
  • We have been supporting local communities and nonprofitcorganizations. In the past year, we contributed one hundred thousand Czech crowns to the Olympie football club in Zdice. We also provided a financial grant of half a million Czech crowns to the town of Zdice for community development. Similarly, we supported the town of Rokycany and local associations with a total amount of one hundred and sixty thousand Czech crowns.
  • Our employees regularly participate in voluntary activities to support the environment, such as tree planting and waste cleanup.
  • We support charitable organizations, including the Czech Ski School of Amputees (CSSA), which assists individuals with lower limb amputations. We, also contributed to ALSA, Nedoklubko, and the Chance for Cancer Children Foundation through participation in charitable beach volleyball tournament.
     

Governance

• We advocate ethical values in management and governance:
  • We commit to an ethical code and whistleblowing rules. We have established a policy for proper governance, and in the future, we will collaborate with suppliers who also adhere to the ARETE Group’s Code of Ethics. We regularly inform and train company employees on the above policies and rules, including the ESG strategy, its implementation, and the subsequent compliance with individual criteria.
• We promote gender equality and ethical values:
  • As a group, we have consistently advocated and supported gender equality. We fill job positions primarily based on the assessment of candidates’ experience, skills, and abilities. The values and work habits of candidates, which must align with our corporate culture and ethical code, also play a role in selection. In terms of compensation, the group has implemented a fair and non-discriminatory remuneration policy to close gender pay gap.