Responsible Investing Policy

About Banyan Capital Partners

Banyan Capital Partners Ltd. (“Banyan”) is the private equity affiliate of Connor, Clark & Lunn Financial Group focused on making equity investments in middle-market businesses across Canada and the United States. Banyan’s ultimate objective is to build a sustainable and diversified portfolio of  private equity investments that generate strong financial returns for its investors.

Introduction

The purpose of this Responsible Investment (“RI”) Policy is to outline Banyan’s approach to incorporating Environmental, Social and Governance (“ESG”) considerations into its investment process. This policy shall apply to all portfolio companies controlled by Banyan, though the methodologies applied may vary depending on the stage of the investment process.

Banyan’s Approach to RI

Banyan believes that, all else equal, companies with sound business practices and effective management of ESG related risks and opportunities may be better positioned to deliver sustainable long-term performance. Consistent with this view, Banyan integrates ESG considerations into its investment process with the objective of supporting and enhancing long-term value creation.

Governance

Banyan’s Management Committee has ultimate responsibility for the firm’s RI strategy. The Investment Committee serves as the central decision-making body responsible for evaluating and approving new investments, including providing oversight to ensure that ESG considerations are appropriately factored into investment decisions. Investment team members are responsible for implementing Banyan’s RI approach, including considering material ESG factors as part of their investment analysis.

ESG Integration

Banyan’s investment team considers material ESG factors that may individually or in combination affect long-term value creation. Banyan defines materiality as factors that may have direct or indirect financial impacts on the financial performance, economic value, reputation, or legal prospects of an investment or asset class. Material ESG factors are identified through sector analysis and investment team judgment.

Deal Sourcing: Investment opportunities must satisfy Banyan’s investment criteria from the perspective of its financial metrics, industry characteristics and transaction rationale before proceeding to be assigned to a deal team. Banyan does not formally exclude companies or sectors based solely on ESG factors. We believe it is important to consider ESG factors as part of our overall investment process rather than unduly narrowing the universe of potential investments. Accordingly, investment decisions are made on a risk-adjusted basis following a holistic assessment of each opportunity, taking into account both financial and material ESG considerations.

Pre-Investment Due Diligence: The investment team will conduct a thorough and comprehensive assessment of the deal’s potential and suitability, which may include any material ESG risks or opportunities. Due diligence will be performed based on publicly available information and information gathered through discussions with the company’s management team.

Investment Decision: The investment team will compile its findings and present its analysis to the Investment Committee, including any material ESG risks and opportunities identified during due diligence as part of the overall risk assessment.

Ongoing monitoring: Banyan maintains an active ownership model, typically holding board positions in its portfolio companies and engaging closely with management through regular interactions. Any material ESG considerations will be monitored post-investment, with a focus on identifying significant ESG issues that may impact prospects for future performance or investment risk.

Review

This RI Policy will be reviewed on an annual basis and revised, as appropriate.