MERIDIAM SUSTAINABILITY RISK POLICY Approach for a Responsible ESG and Sustainability Management

Meridiam is a Benefit Corporation under French law and supports the UN Sustainable Development Goals TABLE OF CONTENTS

INTRODUCTION...... 3

INFORMATION ABOUT MERIDIAM...... 3 General ESG/SDG Approach...... 3 Meridiam’s Sustainability Strategy...... 3 Meridiam’s ESG/SDG Management Approach...... 4 Mission Committee...... 5 Proprietary SDG Analysis Methodology – Simpl...... 5 Climate Strategy...... 6 Resources...... 6 Investor Information...... 7 Meridiam’s Funds...... 8 ESG/SDG charter, code, and label...... 9 ISO 9001 Certification...... 9 External ESG Audits...... 10 PRI Signatory...... 10 Certifications of the Portfolio Companies...... 10

MERIDIAM’S ESG AND SDG ANALYSIS PROCEDURES...... 11 Principal Adverse Impacts Policy...... 11 Main ESG Criteria...... 12 SDG Positive Screening...... 15 ESG and SDG Analysis within the Investment and Asset Management Processes...... 16 Internal ESG and SDG Expertise and Knowledge Sharing...... 17 ESG and SDG Monitoring...... 17

2 INTRODUCTION

Responsible investment is an essential part of the strategic positioning and management of Meridiam funds. Since its creation in 2005 and the launch of its first fund, Meridiam has ensured that its investments achieve the highest environmental, social and governance (ESG) objectives. In 2019, Meridiam positioned itself as one of the first French company to change its by-Laws to become a French Benefit Corporation within the meaning of the French law, and by doing so, reaffirmed its commitment to balancing profit with achieving positive impact. In this context, Meridiam updated its Principal Adverse Impact Policy (PAIP) to classify the ESG risk of investment opportunities and assets and evaluate their positive impacts using the internationally agreed, referential framework of the United Nations Sustainable Development Goals (UN-SDGs). This document outlines how ESG criteria and relevant performance measures are considered in Meridiam’s investment and asset management process. More specifically, this document demonstrates how the Meridiam funds also comply with the regulatory requirements for the application of ESG criteria in France1 as well as in Europe2.

INFORMATION ABOUT MERIDIAM

General ESG/SDG Approach

Meridiam’s Sustainability Strategy

Meridiam places consideration of ESG quality issues at the heart of its activities, due to the very nature of its investments, and their sustainability. As rigorous risk identification is a fundamental step in the project evaluation process, Meridiam commits itself only when these are in line with its commitments and the general interest of the communities for which they are intended.

Since its creation, Meridiam has therefore placed the consideration of ESG issues at the heart of its priorities by adopting a Charter on Sustainable Development focused on these issues. In particular, the Charter on Sustainable Development commits Meridiam to: Protect the environment Respect fundamental rights and develop human capital Meet the expectations of the community Value the human capital of Meridiam Apply the rules of good governance

The Sustainable Development Charter is available on Meridiam’s website

Following its change of status to a French Benefit Corporation, Meridiam reinforced its sustainability strategy by defining 5 pillars based on the SDGs most relevant to its role as a long-term infrastructure asset developer, investor, and manager. These 5 pillars, presented in the table below, set the long-term key measurable objectives of Meridiam’s long-term sustainability strategy. To achieve these 5 objectives, Meridiam is equipped with a variety of tools, notably its tailor-made ESG/SDG survey and dashboard called Simpl., and a set of climate stress test and carbon-related methodologies including the carbon footprint evaluation tool and the 2-Infra Challenge tool. All of these are detailed latter in this document.

1 Decree No. 2015-1850 of December 29, 2015 applying Article 173 (paragraph VI) of the LTECV of August 17, 2015. 2 Regulation (EU) 2019/2088 of the European parliament and of the Council of 27 November 2019 on sustainability-related disclosures in the financial services sector (SFDR). 3 Resilient Clean and Climate Decent work, inclusion, Biodiversity infrastructure and affordable strategy and gender Sustainable Cities energy

Provide resilient Accelerate Avoid Promote good work Protect and infrastructure energy emissions conditions, inclusion, enhance and develop transition and reduce diversity and gender biodiversity sustainable cities them equality

This global responsibility is also central to Meridiam’s commitment to policy makers and public institutions to promote and encourage long-term investment and foster communities’ sustainable development.

University of Iowa, USA

Meridiam’s ESG/SDG Management Approach These ESG and SDG priorities are translated into By integrating the UN-SDGs to its procedures, operational terms by an internally developed Meridiam has reinforced the rigorous impact ESG/SDG approach to analyze and monitor all evaluation assessment and monitoring investment opportunities. This strategy applies of projects, ensured consistency with its to all funds and throughout the lifecycle of sustainability strategy objectives and captured assets. It is based on a selective filtering ahead the positive contribution of these assets of investments, via exclusion and restriction on issues such as health, education, water, lists, followed by a positive selection of resilient sanitation, energy, urbanization, environment, infrastructure projects that answer the needs and social justice. of local communities. This approach is based on international standards, such as the UN Meridiam’s approach to managing ESG and Principles for Responsible Investment (UNPRI), SDG issues is operationalized using tailor- the Equator Principles, and considers the made procedures and tools. The procedures ESG criteria of major financial development and tools are described in upcoming sections institutions such as the International Finance of the document. This approach is part of Corporation (IFC), the World Bank, the European Meridiam’s ISO 9001 system. Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD).

4 Mission Committee A specific Mission Committee was established the Supervisory Board, management, staff to monitor a rigorous and genuine evaluation and one independent member from the of the impact of our investments against industry. The Mission Committee will engage our pillar goals and set new targets for with the Supervisory Board and the employee improvement. This includes a climate strategy representative body called the Comité Social addressing climate-related issues. This et Économique (CSE) at least twice a year. committee of 6 includes representatives of

Proprietary SDG Analysis Methodology – Simpl.

Meridiam has updated its investments contextualized benchmarks that calibrate assessment and monitoring procedures a carefully designed scoring system. It uses to systematically incorporate the SDG data and KPIs available at the portfolio referential framework and to ensure a company level, and collected through an rigorous alignment to global priorities. This annual online survey, to rigorously monitor approach includes the following major steps: and identify each investments’ relevant  contribution to the UN-SDGs. Preliminary assessment of the core and direct Establishment of an SDG Objectives goals material to Meridiam’s activities. Roadmap per asset to identify strongpoints Systematic identification of the relevant pre- and areas of improvement in the upcoming selected indicators during asset assessment years. This will place responsibility on the and validation of related performance portfolio company team to achieve a higher measures and objectives. level of contribution to the SDGs relevant to the asset. Use of its tailor-made tool called Simpl. to evaluate and enhance assets’ positive This process drives each investment team impacts during their lifecycle. Simpl. was members to proactively incorporate rigorous designed to focus on the pre-assessed core performance objectives to their decision- and direct impacts of its sectors of activities making and ensure Meridiam’s commitment while being adaptable to the different to achieving positive impacts. stages of an asset’s development thanks to

DASHBOARD & REPORTING SDG IMPACT SYNTHESIS

5 Climate Strategy

Meridiam specializes in the development, Meridiam has also collaborated with Carbone financing, and long-term management of 4 to develop a risk analysis methodology sustainable public infrastructure in three related to energy, carbon, and climate core sectors: mobility, energy transition and change. Based on the French Development environment, and social infrastructure, all. Agency’s approach, this methodology applies investments that can provide critical solutions to Meridiam’s various project categories. to the collective needs of communities. These Therefore, as part of our investment process, are all selected to align with Meridiam’s we integrate this Energy/Carbon/Climate risk commitment to address climate-related risks evaluation to the project or portfolio company. and achieve its climate strategy for which Based on the results of this evaluation, the specific fund-level objectives are defined, as development team will be able to follow up evoked in our Sustainability Strategy. and prepare the in-depth impact analysis.

As part of its commitment and stewardship Finally, Meridiam carries out the carbon activities regarding climate-related initiatives, footprint evaluation of projects at financial Meridiam contributed with other investors close by using a tool developed by Carbone 4. and with Carbone 4 to the elaboration This tool measures the project’s emissions in of a methodology to firstly measure the construction and operation and the emissions alignment of infrastructure portfolios with a induced or avoided compared to the reference 2°C trajectory, as agreed at the Paris climate- situation. The results are presented in a Scope agreement, secondly, evaluate the exposure 1, 2 or 3 basis. of assets to climate risks, notably caused by physical impacts of climate hazards, and finally, Finally, Meridiam takes a selective approach exposure of assets to transition risks which to infrastructure investment. Our strategy include political, technological, market and excludes and restricts investments that do reputational risks arising from the transition harm to the environment or weaken the to a low-carbon economy. The methodology communities they serve. Consequently, covers the European and North American we have never invested in the extraction, geographies and work is ongoing to cover processing, or transportation of fossil fuels, and Africa. The methodological approach, called never will. Nor will we invest in infrastructure the 2-Infra Challenge methodology, is based using coal as an energy source. on reliable and contextualized data, and the results are validated by a scientific committee.

Resources Meridiam has a team of full time ESG/ employees. If necessary, Meridiam partners SDG specialists but holds each member of with technical experts for ESG evaluations as personnel responsible for the integration part of due diligences, to evaluate the carbon of ESG and SDG themes within investment footprint of projects but also to measure the process, relationship with investors or asset positive impact of investment opportunities management. Ongoing trainings and support and assets within the SDG framework.7 enable continuous skill improvement of

Ten Merina Solar Plant, Senegal

6 Investor Information

Investors are aware of Meridiam’s ESG/ In general, Meridiam issues several reports at SDG procedures for the conduct of all its predefined frequencies, by which investors are activities, as well as key ESG issues related informed of the ESG and SDG indicators that to the investments themselves. In addition, are monitored: Meridiam’s ESG and SDG commitments are A quarterly report is sent to investors, which public and accessible on the website. includes a specific note on ESG and SDG issues for each asset. Meridiam considers investor concerns in An annual ESG/SDG report is produced determining ESG criteria for its investment called the «Impact Report», which includes and asset management process as well as a presentation of Meridiam’s approach and their increasing commitments to contribute policy on these aspects and an analysis materially to international sustainable of selected qualitative and quantitative development goals. Meridiam ensures ESG/SDG indicators with a monitoring of compliance with their requirements to produce performance over time. follow-up reports, whether it be through Other ESG/SDG monitoring reports are documented ESG indicators or the frequency prepared according to the requirements of with which information is disseminated. certain investors and for specific funds, as is the case for the Meridiam Infrastructure Africa Fund. The ESG performance of each project is presented, as well as the ESG performance of the fund.

LaGuardia Airport, USA

7 Meridiam’s Funds

Meridiam currently manages 7 funds, the details of which are presented below.

AMF SEC

Meridiam Meridiam Meridiam Meridiam Meridiam Meridiam Meridiam Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Infrastructure Transition5 North North SICAR Europe II Africa Fund3 Europe III4 America II America III

Asset class Infra Infra Infra Infra Infra Infra Infra

Year of 2008 2012 2015 2016 2016 2012 2017 creation

Duration of 25 25 15 25 20 25 25 the funds

OECD OECD OECD Europe, Europe, countries countries countries including including Geographical in North in North in Europe Central and Africa Central and Europe area America America and North Eastern Eastern Eu- and South and South America Europe rope America America

Public utility Transport services and Public Transport Transport Transport in- infrastructures networks utility infrastructures infrastructures frastructures Social Transport Energy services and Social infrastructures Types infrastructures infrastructures networks Social Social infrastructures Public Social Transport infrastructures infrastructures of projects Energy buildings infrastructures infrastructures Energy infrastructures Energy Social in- infrastruc- Public Public infrastructures frastructures tures buildings buildings

Amount of Meridiam’s assets fol- lowing its 100 100 100 100 100 100 100 ESG policy (as a share of funds, in %)

The funds are managed by either Meridiam SAS (MSAS) or Meridiam Infrastructure North America (MINA). MSAS is regulated by the French Autorité des Marchés Financiers (AMF) while MINA is regulated by the Security and Exchange Commission (SEC).

3 Fund subject to Decree No. 2015-1850 of December 29, 2015 applying Article 173 (paragraph VI) of the LTECV August 17, 2015. 4 Ibid 5 Ibid

8 ESG/SDG charter, code, and label

Meridiam does not manage specific labelled Meridiam’s approach to the environmental and funds. However, all investments contribute to social responsibility and corporate governance achieving ESG and SDG objectives in their own consists in involving all members of the unique way. Therefore, all Meridiam’s funds development and asset management teams simultaneously consider the environmental, in the process of evaluating, developing and social and governance quality criteria of managing the assets in which the organization Meridiam. This represents 100% of our assets invests. Each employee receives training on ESG under management in 7 funds that integrate and SDG topics on an ongoing basis, so that he ESG criteria and SDG assessment. The Meridiam or she takes ownership of the procedure put in Transition fund was created for the sole place for the responsible consideration of these purpose of financing energy transition projects. issues in all assets. Additionally, Meridiam systematically applies Some of the portfolio companies in which the French Article 173 (paragraph VI) of the Meridiam invests also have a dedicated ESG LTECV of August 17, 2015, regardless of whether team. the fund is subjected to foreign legislation. In addition, there is a procedure in place for However, Meridiam’s funds valuated above sharing knowledge and good practices with 500 M € are not under French regulation and portfolio companies on various topics including thus are not subjected to “investors reporting” ESG and SDG-related impacts. publications.

ISO 9001 Certification

The importance of ESG and SDG issues is also Meridiam’s ESG/SDG procedures included in its reflected in the continuous improvement investment and asset management processes; of Meridiam’s operational methodology, the last renewal was in January 2021. as illustrated by the ISO 9001 certification As a reminder, the ISO 9001 certification obtained in January 2012, the first of its kind is an international standard for quality to be awarded to an investment company. This management and provides guarantees in terms certification is renewed regularly and covers of organizational quality within the company.

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9 External ESG Audits Meridiam conducts audits on Corporate Social specifically as a fund manager), in 2011, 2013, Responsibility (CSR) and, more recently, 2015 and 2017 under ISO 26000 and rated on Sustainability, and calls on specialized Meridiam “Advanced”. In 2020, the CSR audit external consultants such as V:E Moody’s, an was replaced by a Sustainability Assessment, independent international research and ESG also carried out by V:E Moody’s on Meridiam agency offering services to private, public, and S.A.S. and its portfolio companies; it covered a associative organizations and investors. more comprehensive and SDG-oriented range V:E Moody’s carried out a corporate social of topics. Meridiam obtained a score of 64/100, responsibility audit of Meridiam on a bi- rated “Advanced” by V:E Moody’s. annual basis (as an organization rather than

PRI Signatory Meridiam has been a signatory of the United - A+ (29/30) for the overall ESG approach Nations Principles for Responsible Investment - A+ (30/30) on topics specific to infrastructures (PRI) since January 5, 2011. In 2020, Meridiam’s ESG approach received ratings of:

Certifications of the Portfolio Companies

Meridiam ensures that ESG issues are conside- Green Energy certification, the LEED certifica- red by all companies created to manage the in- tion, the BREEAM certification and others. frastructures in which the organization invests. Many portfolio companies have also put in place The achievement of performance objectives of- an environmental management system that ten results in obtaining labels or certifications meets international norms and standards such of national or international scope such as the as the ISO 14001 and OHSAS 18001 standards.

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10 MERIDIAM’S ESG AND SDG ANALYSIS PROCEDURES

The ESG/SDG approach is generalized and of value creation throughout the development systematically integrated into Meridiam’s processes and establish performance indicators ISO 9001-certified investment and asset to enhance projects’ positive impacts. The aim management processes. is to identify, avoid, minimize, and compensate potential adverse impacts of projects Each investment opportunity is thoroughly throughout their lifetime. assessed through an initial due diligence analysis prior to investment. When ESG In general, the methodology used in the ESG concerns are highlighted during this process, and SDG analysis process for investment risk mitigation procedures are included in opportunities is built around two integrated the project documentation and specific risk and equally important work streams: 1) the indicators are identified for the implementation Principal Adverse Impacts Policy (PAIP); 2) the of continuous monitoring. Similarly, relevant SDG Positive Screening. SDG targets are identified to determine areas

Principal Adverse Impacts Policy Meridiam’s PAIP provides a set of tools to the investment teams to identify and manage ESG risks and concerns related to every investment opportunity. The PAIP includes the 4 following steps:

1. Eligibility and regulatory check: Verification of the eligibility of the opportunity against the exclusion list established by Meridiam for its various funds. It also includes ESG framing of the opportunity in regulatory terms.

2. Preliminary evaluation: Initial analysis of risks, whether financial, operational, social, or environmental. The level of risk is detailed for each criterion allowing every investment opportunity to be rated according to its overall risk level.

3. Detailed evaluation: Determination of detailed ESG risks. This can be done by performing a detailed Environmental and Social Due Diligence (ESDD) which can lead to conducting a gap analysis or an Environmental and Social Impact Assessment (ESIA) of the project by a specialized team of local and/or international consultants. This extensive piece of work may be already available or non-compulsory, but it nonetheless represents an assessment of the potential environmental and social impacts of a proposed project, an evaluation of the alternatives, and a design for appropriate mitigation, management, and monitoring measures. Therefore, if deemed necessary, the investment teams will undertakes such detailed studies.

4. Detailed implementation plan: Identification of the ESG mitigation and monitoring strategy. The ESG mitigation and monitoring strategy is mostly defined as part of the ESG risk management plans – the Environmental and Social Management Plans (ESMPs) – following the environmental and social assessment phase.

In addition, Meridiam applies strict compliance and the principle of professional integrity to the conduct of all investments, in accordance with regulatory requirements. To this end, each employee of Meridiam subscribes to the Code of Ethics which includes strict reservations/clauses on the issue of conflicts of interest.

In addition, Meridiam ensures that all partners apply zero tolerance to corruption issues, in line with its anti-corruption policy.

11 Main ESG Criteria

The ESG risk assessment and the establishment of avenues for ESG improvement takes place using a set of more than 45 ESG conditions and criteria against which all investments are analyzed, without distinction by sector of activity or asset class. This ESG analysis framework is used to identify the ESG issues and risks that are associated with investments and to determine the risk level of each criteria and the implementation modalities for investment opportunities that will allow these issues to be effectively considered. Each condition/criterion must be documented during the different analysis phases. Here are some examples of analysis criteria.

A5 Ostregion Motorway, Austria

ESG THEMES Examples of criteria for the evaluation of investments

Free from exploitation of child labor WORKING Free from forced or compulsory labor practices STANDARDS Good working conditions, in terms of health / safety and equality

LAWS AND Legal context and compliance REGULATIONS Procurement procedure

Client’s ESG policy and procedures ESG CAPACITY ESG policy and procedures of Meridiam’s Partners

Impacts on the physical components of the environment ENVIRONMENTAL Impacts on nature protection areas and biodiversity ISSUES Impacts on fauna, flora, and habitats Environmental measures

Social impacts Cultural heritage SOCIAL ISSUES Interests of stakeholders Land acquisition and resettlement

Vulnerability to climate change ENERGY, CARBON Contribution to the fight against climate change AND CLIMATE Combined risk relating to the Energy and Carbon market and Climate risk

12 Four levels of risk can be identified for Nevertheless, no specific weighting is each ESG element that will be assessed; defined for one category of ESG issues the level of risk will vary from «low» to compared to another. The relative weight «constraint». The risk assessment itself of the categories of ESG criteria, some considers criteria such as the intrinsic examples of which are given above, is value of the component affected by the therefore the same for each of them. The proposed investment opportunity, the decision to pursue the development of possibility of implementing measures a potential investment is based on the to control and limit the impacts of the overall assessment of ESG issues and asset on this component, the social risks; Meridiam must be confident that acceptability, etc. The application of it can effectively manage ESG issues to this methodology not only makes it move forward with an opportunity. possible to evaluate all the ESG risks of In the asset management phase, i.e., an opportunity but also to understand during the construction and operation the context in which it is to take place. In of the infrastructures, the ESG and addition, by providing details of the issues SDG analysis is carried out based on related to the asset, the methodology detailed criteria whose scope is adjusted allows for an efficient transition to the according to the type of infrastructure implementation phase of the asset, and the issues it generates. More than namely the construction and operation 200 criteria are used to monitor the of the infrastructure. implementation of ESG measures and to Regarding ESG risks, all funds managed evaluate the ESG and SDG performance by Meridiam integrate all ESG criteria due of assets in portfolio. The following table to the nature of the investment process. shows some of the ESG criteria.

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13 Examples of criteria to analyze ESG ESG THEMES the performance of assets

Environmental policy GENERAL Training ENVIRONMENTAL Environmental protection expenditure POLICY Climate change risk management approach

Air quality / emissions CONTROL OF Water POLLUTION Soil AND WASTE Noise ENVIRONMENTAL MANAGEMENT Waste Discharges

Energy consumption SUSTAINABLE USE Water consumption OF RESOURCES Resource consumption

Protected areas and species BIODIVERSITY Minimization and compensation Deforestation

Job creation Diversity EMPLOYMENT Representation of workers Working conditions Management of complaints and grievances

Training policy TRAINING Training results Percentage of employees trained

Safety procedures and programs SAFETY Results in terms of safety for workers and users SOCIAL

Impact on local employment and the economy ECONOMIC AND Questions from stakeholders (employees, unions, suppliers, SOCIAL IMPACT neighboring populations, etc.) Relations with local development and support actors

ARCHAEOLOGY Archaeological discoveries and presence of heritage sites AND CULTURAL Communication to the public HERITAGE

MANAGEMENT Stakeholder involvement

GOVERNANCE

Certifications / labels COMPLIANCE Sanctions / penalties

14 SDG Positive Screening

In addition to the above mentioned ESG criteria, the analysis framework also includes a preliminary assessment of material SDG’s core and direct indicators determined for each type of asset. This enables for the systematic identification of the investment’s associated positive impacts and resulting performance indicators that are to be considered during the development of the project. Thus, the indicators selected by the investment team during the opportunities’ origination will have to be carefully monitored, and when possible, documented for later validation during the analysis phase. According to the 4 development steps of the PAIP, the SDG positive screening includes the following tasks.

1. Eligibility and regulatory check: Verification of the adequacy of the opportunity with Meridiam’s Sustainability Strategy and ancillary objectives.

2. Preliminary evaluation: Initial identification of SDGs relevant to the investment opportunity based on Meridiam’s SDG proprietary framework and using few positive impact indicators.

3. Detailed evaluation: Determination of opportunities to enhance the opportunity’s contribution to SDGs including design optimization options and additional resilience and sustainability measures.

4. Detailed implementation plan: Integration of SDG optimization measures within the asset’s ESG mitigation and monitoring strategy, including in the asset’s ESMPs. Meridiam’s investment teams can rely on specific tools to conduct the SDG positive screening of investment opportunities. These tools provide a set of relevant SDGs and initial indicators which have been identified for each sector of activities or type of assets. Our general approach with respect to identification of material SDGs and indicators is summarized in the following figure.

MERIDIAM’S POSITIVE SCREENING APPROACH BASED ON THE UN-SDGS REFERENTIAL: 17 UN Sustainable Development Goals (SDG) to be achieved by 2030, declined into 169 targets

RELEVANT SCOPE FOR MERIDIAM For each asset, according to its local context and mission, identification of relevant SDGs and targets by following the most material parameters. CORE IMPACT DIRECT IMPACT

INDICATORS AND RELATED SCORING

• Definition of indicators to assess each infrastructure’s impact on its relevant SDGs and targets • For each indicator, definition of a robust benchmark for assessment, accounting for regional context • Transparent all-in-one tool to monitor each asset’s impact and contribution to the SDGs over time

15 ESG and SDG Analysis within the Investment and Asset Management Processes

The assessment and the establishment of avenues for ESG and SDG improvement, conducted according to Meridiam’s PAIP and SDG Positive Screening procedures, take place as soon as investment opportunities are identified using the criteria mentioned above. In practice, this work is undertaken as part of the opportunities’ overall evaluation which also includes financial, commercial, political, reputational, and organizational risks assessment. This comprehensive evaluation will take place at different strategic times during the development of the opportunity and benefit from access to detailed information and to stakeholders as the process evolves. The following diagram shows how ESG and SDG issues are integrated within Meridiam’s investment and asset implementation process.

DEVELOPMENT AND ESG AND SDG INVESTMENT SCOPE OF THE ESG IMPLEMENTATION RISK & IMPACT PROCESS PHASE AND SDG PROCEDURES PROCESSES MANAGEMENT Preliminary Environment Initial ESG/SDG evaluation ESG and SDG and Market based on Meridiam’s ESG/SDG Assessment Analysis / requirements : Origination List of excluded and restricted activities More than 45 ESG conditions and criteria Identification of E&S permitting and reporting requirements Initial evaluation of ESG risk level and of contribution to SDGs

Detailed ESG Risk Initial Project Systematic assessment of ESG Evaluation Development risks and impacts, which include: Investment and SDG Validation Site visits process Detailed E&S studies such as E&S Gap Analysis, detailed E&S Impact Assessments (ESIA) Review and optimization of the project design and of the E&S measures including the overall E&S Management Plan and strategy to optimize contribution to SDGs

Detailed ESG Tender / Active Definition of detailed ESG risk and SDG Development management plans and SDG Implementation optimization measures as well as Plan Resilience performance plan

Asset ESG and SDG Asset Monitoring and reporting based on Construction and Reports Management tailor-made ESG-SDG performance Operation process assessment

16 All of Meridiam’s investment opportunities are complies with Meridiam’s Sustainability Risk reviewed based on Meridiam’s Sustainability policy to go ahead with further development Risk policy using the PAIP and SDG Positive and, eventually, investment. If the opportunity Screening tools, including on the lack of is not aligned with our Sustainability Strategy, controversial elements and the opportunity to or if the ESG issues are too significant and/ engage positively with local stakeholders and or unmanageable, or if the compensatory authorities to develop a sustainable project. measures prove to be insufficient, the investment process is not continued. It is necessary for the investment teams to obtain confirmation that an opportunity

Internal ESG and SDG Expertise and Knowledge Sharing A team of ESG/SDG specialists is involved procedures and SDG assessment by the teams full-time in the implementation of Meridiam’s and their commitment, training sessions Sustainability Risk policy and procedures. In are organized on ESG and SDG topics and addition, all staff are engaged and proactive on the mechanisms for integrating these in integrating ESG and SDG elements into issues into the conduct of their activities. The projects and investment opportunities participation of all team members in official that are controlled under Meridiam’s ISO training sessions with the Meridiam ESG/SDG 9001 system. To ensure ownership of ESG compliance team is mandatory.

ESG and SDG Monitoring

At the assets level, Meridiam is an involved contributes to Meridiam’s ESG/SDG reports via investor and asset monitoring is done on three the annual surveys from the Simpl. tool. These complementary levels: surveys were developed by Meridiam with the assistance of experts in the field, compiling Representation on the Board of Directors: industry best practices and additional Meridiam is represented on the Board of components more specific to its business. Directors of each of the portfolio companies. External audits of the certification processes Staff of the portfolio company: Meridiam take place annually or every two years, led appoints full-time members to the by external certification or rating bodies, management team of each asset or provides whereby Meridiam’s ESG/SDG approach is seconded staff. evaluated. Thus, the organization seeks to Active/involved management of assets maintain a certain standard in the quality of according to a local approach. its management and more generally in its procedures. The proximity with its assets ensures that Internal audits on compliance and ESG topics Meridiam’s investments are managed are also organized on a recurring basis, for transparently in all areas, including for ESG example on an entire portfolio of Meridiam and SDG aspects. Each portfolio company funds or a part of it.

University of Barcelona, Spain

17 CRCHUM, Canada

Meridiam is a Benefit Corporation under French law and supports the UN Sustainable Development Goals