1. Definition and Scope of Sustainability Risk
Sustainability risk is defined as any environmental, social, or governance (ESG) event or condition that, if materialized, could have a significant negative impact on the value of an investment. The magnitude and likelihood of such risk depend on multiple factors, including the nature of the issuer, its economic activity, geographic location, asset class, and type of investment instrument.
In this context, Ginvest Asset Management SGIIC (Ginvest AM), as a financial product manager, assumes the responsibility of integrating considerations beyond purely financial criteria, incorporating, to the extent possible, elements that contribute to a more sustainable economy. Just as financial risks are exhaustively analyzed in any investment decision, sustainability risks must also be evaluated with the same rigor and methodology.

2. Consideration of Sustainability Risk in Managed Funds
Currently, the funds managed by Ginvest AM do not promote environmental, social or governance (ESG) characteristics or have a sustainable investment objective, in accordance with Regulation (EU) 2019/2088 on sustainability-related disclosures in the financial services sector (SFDR). However, although these factors are taken into account in the investment process, they are not decisive in portfolio composition. In line with the position of the European Securities and Markets Authority (ESMA), Ginvest AM is aware of the challenges associated with the heterogeneity of ESG rating methodologies, which hinders comparability for investors. The recent taxonomy regulations aim to mitigate this issue and allow for a more uniform assessment of the sustainability characteristics of financial assets.

3. Application of ESG Criteria in the Investment Process of discretionary management portfolios and advisory services
Although Ginvest AM does not formally integrate sustainability risks into its investment strategies, the entity has an internal objective to allocate a minimum of 50% of its exposure to assets classified as Article 8 or 9 of the SFDR Regulation. Given that investment services are implemented through third-party products, the assessment of the sustainability risks of these assets falls to the managers of the underlying funds, who are required to periodically disclose information on ESG ratings, as well as other qualitative and quantitative indicators relevant to investment decision-making. Within the analysis and portfolio construction process, Ginvest AM will consider this information as an additional element within its analytical models, given that sustainability risks can potentially affect long-term returns for investors.

The institution's investment philosophy is based on a comprehensive assessment of all risks that may impact investment profitability, incorporating tools to identify, manage, and mitigate non-financial risks. To this end, it emphasizes the importance of ongoing communication with the managers of the underlying funds and active investment monitoring.

4. Incorporation of Sustainability Risk Assessment Tools
As part of its commitment to improving risk control processes, Ginvest AM has incorporated an analytical solution from an external provider with experience in ESG risk assessment. This new system will allow:

• Integrating sustainability metrics into investment analysis.
• More effectively monitor ESG exposure in managed portfolios.
• Obtain standardized and comparable data in line with European regulations.
• Optimize investment control and monitoring procedures from an ESG perspective.

With this new technological addition, Ginvest AM adds more robust sustainability risk control tools, ensuring a continuous and accurate assessment of the ESG impact of its investment strategies.

5. Commitment to Due Diligence and Regulatory Compliance.
As a collective investment fund manager, Ginvest AM is subject to strict due diligence and oversight principles in the selection and monitoring of investments. In accordance with applicable regulations, the entity must:

• Ensure in-depth knowledge of the assets in which your funds invest.
• Implement effective due diligence policies and procedures to manage and mitigate risks.
• Ensure that all investment decisions are made in line with the objectives and strategies of the managed funds.

In this regard, Ginvest AM will continue to evolve its ESG analysis framework, maintaining a balanced approach between financial profitability and the integration of sustainability criteria, with the goal of offering a solid, responsible investment model aligned with the best practices in the financial sector.