Social and Environmental Responsibility : Doing Well by Doing Good

CEF has a proven record of generating excellent financial returns while achieving important environmental and social goals. CEF believes social and environmental (S&E) compliance strengthens core competence and enhances financial valuation in portfolio companies.

Since inception CEF has worked with renowned socially and environmentally conscious limited partners such as LESS, ADB, FMO, Norfund and Calvert Ventures. Through collaboration with policy makers, industrial players and investors, the Fund has led socially and environmentally responsible investing in China, and developed a growing stable of highly successful companies.

In a time in which corporate social responsibility is widely claimed, CEF's ethical investment experience and ability to deliver genuine, sustainable results is vital to investors seeking to develop genuine corporate citizenship. As the first cleantech fund in China, CEF's credentials as a socially responsible investor (SRI) are unparalleled.

CEF is the first private equity fund in China to implement an industry S&E standard in the area of cleantech investment. A systematic approach to assessing, then routinely monitoring companies' suitability for responsible investing is used, with a cutting-edge system of environmental auditing. The audit identifies areas of environmental concern, environmental strengths and weaknesses, and assesses compliance with legislation, organizational policies and good environmental practice. The audit also prioritizes actions that need to be undertaken.

Not only does CEF fund companies whose aims and products are compatible with its cleantech vision: it also requires companies with the right practices and production techniques.

The Fund monitors the following areas: training and communications for staff in areas of environment, health and safety, to ensure that environmental goals are known to more than simply the top management; air pollution, including a full list of all emissions rather than just major discharges; water pollution, including assessment of the possible results of spillages; waste management, with particular focus on recycling opportunities; energy efficiency, including electrical and gas equipment, lighting, air conditioning and company vehicles; hazardous materials, including environmentally harmful materials such as solvents and scarce resources such as tropical hardwoods; and transport and distribution, including environmental purchasing criteria for vehicles.

CEF also requires broadly high ethical standards of its investee companies beyond the environmental domain. The required ethical treatment of staff covers on site health and safety, equal opportunities and living wages, as well as family-friendly working hours policies and no use of child labor. Fighting corruption has rightly become recognized as a vital factor in successful development, and CEF looks for companies with international standard accounting systems, proper interest-disclosure, transparent financial reports and publicly known anti-bribery policies.

CEF also works pro-actively with companies to ensure they maintain and improve their standards, using Fund action plans to correct any areas which may be lacking and working with management to oversee their continuous implementation.