January 3, 2022

To our stakeholders:

I am pleased to confirm that ProA Capital reaffirms its support of the Ten Principles of the United Nations Global Compact in the areas of Human Rights, Labour, Environment and Anti-Corruption.

In this annual Communication on Progress, we describe our actions to continually improve the integration of the Global Compact and its principles into our business strategy, culture and daily operations. We also commit to sharing this information with our stakeholders using our primary channels of communication.

Because of the nature of our business, Asset Manager for Private Equity Funds, most of the undertaken actions are conducted at the companies owned by the funds we advise. In addition, we have taken action also at ProA Capital level such us partnering with Fundación Prodis and Fundación Aura, conducting a cybersecurity assessment or upgrading our corporate governance policies.

Sincerely yours,

Fernando Ortiz
Managing Partner

We state our commitment to support the Universal Declaration of Human Rights, not only at company level but also to assess our providers. Since we operate mainly in Spain and Italy and we satisfy all legal requirements for those jurisdictions, the risk assessment is low for our portfolio companies.

All the companies owned by Funds advised by ProA Capital have now (apart from those recently acquired) the relevant policies in place to ensure the following:
o Ensure workers are provided safe, suitable and sanitary work facilities
o Protect workers from workplace harassment, including physical, verbal, sexual or psychological harassment, abuse or threats
o Take measures to eliminate ingredients, designs, defects or side-effects that could harm or threaten human life and health during manufacturing, usage or disposal of products

These elements are contained within the following policies (it varies by company):
o Acknowledgement of ProA Capital´s ESG Policy: All companies are aware of our policy and acknowledge that it fixes the minimum standards for their respective policies
o ESG Policy: All companies have now their ESG policies where the company states it commitment to comply with Human Rights
o Equal Opportunities and anti-harassment
o Health and safety
o Food safety for those companies where it applies (i.e., Delafruit, Moyca and Pastas Gallo)

To ensure that all these policies are beyond all regal requirements and keep up to date we reached an agreement with CHR Legal, a boutique specialized on governance. CHR conducts an assessment after our investment to identify gaps and opportunities, states an action plan and conduct annual checks to ensure that the company keeps its framework and practices up to date.

We keep constant dialogue with our portfolio companies. As described in the following sections, we conduct thoughtful Due Diligence on Labor, Legal and ESG matters before any investment is made. Upon acquisition, we monitor more than 30 KPIs on ESG matters on monthly basis.

Labour rights are critical for our portfolio companies since we employee thousands of employees and we want to attract and develop the best possible talent. Before any investment is made a complete Labor Due Diligence is conducted to fully understand risks and opportunities.

We don´t directly manage the companies where we invest. But through the Boards of Directors, we have implemented the polices framework that covers all the following elements:
• Ensure that the company does not participate in any form of forced or bonded labour
• Comply with minimum wage standards
• Ensure that employment-related decisions are based on relevant and objective criteria
Besides we are encouraging all companies to achieve ISO 45001 certification on Health and Safety to certify, by a third party, that the companies are beyond any legal requirement.

Finally, on the labor area we reached an agreement with Fundación Prodis in Madrid and Fundación Aura in Barcelona to employ people with some disabilities at our companies. As of today, we have employees of these Foundations at Neoelectra, IPD, Pastas Gallo and as well as at ProA Capital.

On monthly basis all portfolio companies monitor and report to their respective Boards of Directors a set of KPIs composed by more than 30 KPIs. As an example of the monitored KPIs on Labour are: Number of incidents with and without days lost, turnover of employees, Health and Safety trainings, % of temporary workers, % of women at Executive, Middle Management and Total workforce, % of employees with disability, etc.

Environmental risk varies by company given the sector they operate at. However, we take thoughtful analysis before any investment is made, analyzing both risks and opportunities and define concrete action plans to materialize them.

All companies have now an Environmental Policy approved and implemented that covers all these matters:

o Avoid environmental damage via regular maintenance of production processes and environmental protection system (air pollution control, waste, water treatment systems, etc.)
o Ensure emergency procedures to prevent and address accidents affecting the environment and human health
o Minimize the use and ensure safe handling and storage of chemical and other dangerous substances

In addition, in the ESG Action Plan we requested, we encouraged companies where the possibility exist to build a PV plant. These plants are now under construction or about to be constructed. The companies are Moyca, Pastas Gallo, Avizor and Delafruit.

Besides, one of our portfolio companies, Neoelectra, is conducting through its engineering division an energy efficiency assessment to identify areas of improvement to save energy.

Finally, on the environmental area, we partner with ClimatePartners to conduct a CO2 footprint calculation for 2020 emission as a first step to develop action plans during 2022.

We request companies to monitor and report a complete set of KPIs on monthly basis. The section on Environment contains metrics such us: Energy and Water consumption, % of recycled water, % of energy from renewable sources, GHG emissions, Waste produced, etc.

We are now gaining perpective on the KPIs to then, hopefully in 2022, being able to define action plans.

We conduct thoughtful legal and Tax Due Diligence before any investment is made to ensure our investment don´t conduct such practices. Once the investment is made we define a plan to conduct a thoughtful corporate compliance assessment. To then define and implement an action plan.

As committed, all portfolio companies have now an ABC policy that covers all the points below:
o Assess the risk of corruption when doing business
o Mention “anti-corruption” and/or “ethical behavior” in contracts with business partners
o Ensure that internal procedures support the company’s anti-corruption commitment

This is an area of specific focus of the diagnostic conducted by CHR Legal on annual basis, to ensure ABC risk is properly covered at our portfolio companies.

In addition, our companies are preparing action plans to achieve ISO 37301 on Corporate Governance to ensure all are beyond any legal requirements.

Besides, we conduct regular training at ProA and portfolio companies to ensure the culture is implemented.

On monthly basis we monitor the % of employees trained in anti-corruption practices. Besides, all incidents are inmediatelly reported to the respective Boards.