Responsible Investment Policy

Exagon Impact Capital (“XIC”) was founded with a mission to deliver sustainable infrastructure and renewable energy investments throughout Latin America and the Caribbean (the “Region”) that generate superior risk-adjusted returns with meaningful, measurable impact. We are committed to growing our business and meeting our investment objectives while meeting the highest industry standards and best practices for environmental, social, governance, and impact (“ESGI”) management.

To achieve these goals XIC commits to:

Attract capital from investors looking to have a meaningful impact.
Attract the highest caliber talent, hiring like-minded individuals with a drive to positively impact society.
Ensure a strong alignment of interests between the XIC team and its investors for all financial and non-financial objectives.
Prioritize quality and results over growth.
Improve continuously by, fostering a team culture, and emphasizing the importance of performing with integrity, accountability, and a “ready-to-learn” mentality.
Integrate the highest ESGI Standards by working with the investments’ stakeholders during the investment’s lifecycle.

To this purpose, XIC has developed a proprietary ESMS that applies to all our investments, including the following ESGI Policy, the ESGI Standards and requirements, organizational capacity and competency, and our monitoring and reporting processes. The ESMS is reviewed annually and updated as needed to reflect improvements in our alignment to meet the highest ESGI Standards.

Policy Statement

XIC’s mission is to achieve superior financial returns while accelerating the transition to a sustainable and circular economy through ESG-oriented global impact infrastructure investing in the Region. Therefore, our sustainable investment strategy is focused on three main aspects.

*A triple-bottom-line sustainable approach, investing in companies and projects that we believe meet both our financial return and impact criteria*

With a strong focus on (predominately greenfield) renewable energy, XIC aims to invest across the following sustainable infrastructure sectors:

Thus, XIC’s ESGI policy has a tripartite approach on ESG, impact and gender.

ESG commitments

To successfully comply with its ESGI processes, XIC commits to:

Comply with all applicable national and local regulations in our target markets.
Forbid investments in any project or company with primary business activities listed in XIC’s Exclusion List.
Identify, assess, and mitigate adverse ESG impacts and risks following the mitigation hierarchy.
Respect and promote human rights in accordance with the United Nations (“UN”) Guiding Principles on Business and Human Rights and the International Bill of Human Rights in our relationships with our employees, investment companies, communities, contractors, and suppliers.
Enforce ESG standards and values through active ownership of the investment companies and exercising voting rights.
Integrate ESG matters throughout the investment process through the incorporation of recognized frameworks and standards, including the UN Principles of Responsible Investing (“PRI”), the International Finance Corporation (“IFC”) Performance Standards (“PS”), the World Bank Group’s Environmental, Health and Safety Guidelines (the “WB EHS guidelines”), the European Investment Bank (“EIB”) E&S Standards, our investors’ E&S principles, the UN Sustainable Development Goals (“SDGs”), 2X Challenge, the Organization for Economic Co-operation and Development (“OECD”) Guidelines for Multinational Enterprises, the UN Guiding Principles on Business, and the Human Rights, the International Labor Organization (“ILO”) Core Convention and the International Bill of Human Rights.
Disclose and report ESG outcomes and indicators.
Continuously enhance its capacity to adopt and foster responsible investing principles and practices.

Impact commitments

Through its investments, XIC aims to play a significant role in closing the financial gap necessary to meet the UN SDGs and achieve measurable impact. Therefore, XIC commits to:

Develop a theory of change consistent with the investment strategy that clearly defines the impact objective(s).
Assess and analyze the expected impact of each investment based on a defined impact measurement and monitoring methodology.
Define impact indicators based on the results of the theory of change.
Assess, address, monitor, and manage potential negative impacts of each investment.
Monitor the progress of each investment in achieving impact through the defined indicators.
Appropriately disclose and report impact outcomes and indicators.
Review, document, and improve decisions and processes based on impact outcomes and lessons learned.

Diversity and Gender commitments

XIC is committed to fostering diversity, equity and inclusion in its investments and operations, focusing on gender equality. The firm values diversity in all forms, including race, gender, religion, ethnicity, sexual orientation, nationality, political affiliation, physical ability, marital or family status, age, and culture. These elements are integral to creating an inclusive environment where employees feel welcomed, valued, respected, and heard. By investing in diversity and promoting an inclusive culture, XIC believes it will attract top talent and help close the gender gap in its investments, ultimately benefiting all its stakeholders. Therefore, XIC commits to:

Provide equal employment opportunities to all and have in place zero tolerance procedures for discrimination and gender-based violence and harassment (“GBVH”).
XIC will apply a gender lens to its investment strategy, increasing women’s participation in renewable energy and infrastructure. It will implement a gender action plan to support portfolio companies in fostering inclusive workplaces and advancing women’s careers.

By 2030, and in line with the 2X Challenge, XIC is committed to:

At the investment manager level: Address “Leadership” (criteria 2) by having at least 30% women representation in the Investment Committee (“IC”) and other leadership positions, and “Employment” (criteria 3) by achieving equal gender representation (50%) in its workforce and having in place employment indicators beyond compliance.
At the portfolio level: Address “Leadership” and “Employment” criteria by having at least 30% of portfolio companies with women in leadership positions or a balanced share of women in the workforce per the 2x criteria and employment indicators beyond compliance.

ESGI integration

XIC’S ESMS has been designed to integrate ESGI considerations into its investments from the initial stages through exit

On ESG: The E&S assessment includes (i) reviewing XIC’s Exclusion List; ii) conducting thorough due diligence to identify gaps between each investment, local regulation, and ESG international standards; (iii) establishing ESG contractual clauses in legal agreements as Environmental and Social Action Plans (“ESAPs”); and (iv) implementing a monitoring process to track each investment’s E&S performance.

On Impact: Each investment’s impact is assessed through a continuous process of measurement, monitoring, and reporting using specific indicators.

On Gender: XIC will adopt the BII Gender Toolkit to embed a gender-smart approach throughout our investment operations, from origination and due diligence to decision-making, deal structuring, portfolio management, and reporting.

ESGI organizational capacity

XIC has established governance systems to ensure ESGI considerations are consistently implemented, updated, and monitored throughout the investment process. This commitment is driven by visible leadership, resource allocation, and ongoing actions to enhance ESGI performance. Senior management approves all ESGI policies and procedures, while the ESGI specialist oversees, implements, and updates them with the support of investment professionals and external E&S advisors.

XIC Managing Partners