Definitions

Taxonomy aligned
Assets need to be energy class A or top 15% or 30% in the national stock (assets built before 12/2020) or 10% lower than nearly zero-energy buildings (assets built after 12/2020), in addition to other criteria.

Energy efficient assets
Meeting the Taxonomy criteria of top 30% in the country’s building stock or better.

SBTi
Science Based Targets initiative, the leading organisation that defines best practice in emissions reductions and targets in line with climate science.

GHG
Greenhouse gases.

Capex
Capital expenditure.

On-site renewables
Solar energy and geothermal heating.

Social contracts
Contracts in collaboration with municipalities to house vulnerable groups, as well as rented apartments with special services for adults.

EU Taxonomy

Taxonomy is the standard for green economic activities set by EU legislation since 2022. For Slättö, the EU Taxonomy is the key portfolio metric for two very important issues: energy efficiency and climate risk adaptation. We integrate the Taxonomy criteria into underwriting, asset management and exit planning. 

Under the EU Taxonomy, the criteria for older assets is energy efficiency at top 15–30% of the national building stock, while new assets are assessed against near-zero energy building standards. In addition, there are physical climate risk criteria, as well as other requirements for new build. 

In practice, Slättö uses the Taxonomy both to assess current asset quality at transaction, and to drive improvement over time. 

• At transaction, Slättö considers assets that do not meet the energy criteria of the Taxonomy as both a risk and an opportunity.
• We incorporate energy upgrades into the business plan and deal terms, then begin implementation post-investment to support Taxonomy alignment.
• During ownership, our annual KPI is to increase the share of our portfolio that meets EU Taxonomy requirements.

 We increase alignment through:

• Energy investments in existing buildings - either a “brown-to-green” approach or optimisation.
• Developing projects with near-zero energy standard.
• In addition to climate risk management.

The result is higher net operating income, lower risk, and potentially trading at tighter yields. 

EU Sustainable Finance Disclosure Regulation

Slättö defines a sustainable investment under SFDR as an investment that makes a significant contribution to either one of the EU Taxonomy objectives, climate change mitigation or climate change adaptation, while not harming any other objective and meeting minimum safeguards.

More information including fund-level SFDR reporting is available on the investor portal.