Product Disclosure for the Monterro Funds M5 and G2

This disclosure is made for M5 Software Investment D1 AB, reg. no. 559523-1027, M5 Software Investment D2 AB, reg. no. 559523-1217, and M5 Software Investment E AB, reg. no. 559523-1019 (together, the "M5 Funds") as well as G2 Software Investment D1 AB, reg. no. 559522-9419, G2 Software Investment D2 AB, reg. no. 559522-9500, and G2 Software Investment E AB, reg. no. 559522-8973 (together, the "G2 Funds"). The M5 Fund and G2 Fund are managed by Monterro Fund Management AB ("Monterro"). They are referred to as “The Funds” in the below Disclosure.

Summary

The Funds are classified as Article 8, meaning they promote environmental and social characteristics but don't have sustainable investment as their core objective.

The Funds promote employee satisfaction, reducing carbon footprint and increasing renewable energy use, gender diversity on boards and management teams, ESG governance, cybersecurity management, and adheres to an exclusion policy that avoids investments in weapons, tobacco, and the pornography/sex industry.

The investment strategy centres on building sustainable software businesses, with ESG factors integrated into all investment decisions. ESG due diligence is conducted on every potential investment.

Each characteristic is tracked through specific indicators, and monitoring happens through periodic data collection from portfolio companies, ongoing dialogue, and board representation.

Data is collected primarily from portfolio companies through a structured annual process using an external platform. Monterro doesn't introduce estimated data itself, though portfolio companies may use some estimates. Data quality is ensured through standardized templates, reviews, and follow-ups when gaps or inconsistencies are found.

Data availability and completeness can vary. However, because the characteristics are promoted through active ownership and engagement rather than strict quantitative thresholds, these limitations don't prevent the characteristics from being promoted.

Monterro engages with portfolio companies primarily through board representation and dialogue to drive improvements across the promoted areas. Sustainability-related controversies are handled through a risk-based process involving fact-finding, engagement with management, and monitoring of corrective actions.

No sustainable investment objective

The Funds promote environmental and social characteristics but does not have as its objective sustainable investment.

Environmental or social characteristics

The Funds promote the following environmental and social characteristics:

  • Employee Satisfaction: The Funds aim at promoting improved employee satisfaction in portfolio companies.
  • Improve climate footprint and renewable energy usage: The Funds aim at enabling reduction of portfolio companies’ carbon footprint and promote the increased use of renewable energy.
  • Gender diversity: The Funds aim to promote improved gender diversity in portfolio companies’ boards and management teams.
  • ESG governance: The Funds are committed to promote improved ESG governance in portfolio companies.
  • Cybersecurity: The Funds are committed to promote improved cybersecurity management in all portfolio companies.
  • Exclusion policy: The Funds do not invest in portfolio companies or assets whose primary activities or use consist of:
    • assault arms or weapons trading or production
    • manufacture or sales of tobacco
    • pornography or the sex industry.

Investment strategy

The Funds’ focus are on building and developing sustainable, long-lasting software businesses that create value for shareholders, minimize risk, offer safe and equitable working opportunities for employees, and deliver value to the end-customers of its portfolio companies. Investment decisions are based on a comprehensive analysis of both financial and ESG factors. The fund systematically integrates sustainability risks into the investment decision process, including conducting internal ESG due diligence for all cases.

Good governance

Good Governance practices, including sound management structures, employee relations, remuneration of staff and tax compliance are considered pre-investment as part of the pre-investment due diligence process. Portfolio companies must adhere to fundamental principles concerning human rights, labour law, environmental protection, and anti-corruption.

Proportion of investments

All investments of the Funds will be aligned with the environmental and social characteristics promoted by the Funds and in accordance with the binding elements of the Funds’ investment strategy.

Monitoring of environmental or social characteristics

The following sustainability indicators are used to measure the attainment of the environmental and social characteristics promoted by the Funds:

Employee Satisfaction

  • eNPS score

Climate performance and renewable energy usage

  • GHG emissions
  • GHG intensity
  • Share of renewable energy

ESG governance (policy)

  • Share of portfolio companies with adopted ESG policy and Code of Conduct

Gender diversity

  • Board gender diversity
  • Management team gender diversity

Cybersecurity

  • Number of Cyber security penetration tests done
  • Number of security awareness training conducted
  • Number of Opensource vulnerability scanning done

Exclusion policy

  • Share of investments in compliance with the exclusion policy

Monitoring is performed through (i) periodic data collection from portfolio companies including the above-mentioned indicators, (ii) ongoing dialogue and engagement, including through board representation, and (iii) review of reported information and portfolio-level outputs by the dedicated resources within Monterro Group. Identified gaps or inconsistencies that are deemed material are followed up with the relevant portfolio company.

Methodologies and data sources and processing

Data used to monitor the environmental and social characteristics is primarily sourced from portfolio companies and provided via a structured annual data request. An external platform is used to facilitate data collection from portfolio companies and to support standardisation and calculation/aggregation of certain sustainability indicators (including relevant PAI-related calculations) based on portfolio company inputs and their suppliers’ certificates. Certain data points may also be collected directly by Monterro from portfolio company outside the platform-based process.

Measures taken to ensure data quality include standardised definitions, templates and reporting guidance and a reasonable review of received information at portfolio level by dedicated resources at Monterro. Where inconsistencies or data gaps are identified, Monterro follows up with the relevant portfolio company.

Monterro does not introduce estimated/modelled data when compiling the indicators for SFDR reporting. Some underlying portfolio company inputs may nevertheless include estimates. Monterro does not control the use of estimates at portfolio company level, but seeks to improve data quality through guidance, validation checks and follow-up engagement.

Limitations to methodologies and data

As each Fund invests in private companies of different size and maturity, certain limitations on data availability and completeness may apply as well as differences in reporting practices. If limitations are identified and deemed material, they are typically addressed through follow-ups and engagement with the portfolio company and through improvements to guidance and data collection process over time.

Because the environmental and social characteristics are primarily promoted through the Funds’ investment strategy and active ownership, and the indicators are mainly used for monitoring and reporting (not as quantitative thresholds), any data limitations may affect the precision or completeness of reporting but do not prevent the characteristics from being promoted.

Due diligence

Monterro’s investment decisions are based on a comprehensive analysis of both financial and sustainability factors. Monterro conducts internal ESG due diligence on potential investments which follows a structured process to assess the overall ESG maturity of the potential target and identify key sustainability risks and considerations. The due diligence findings are reviewed internally and used to inform the investment decision.

Engagement policies

As an active owner, the engagement during the holding period is mainly expressed through interaction and dialogue with the portfolio companies, especially through Monterro board representation. Engagement is used to support the environmental and social characteristics promoted by the Funds and typically focuses on improving performance over time in areas such as employee satisfaction, climate performance and renewable energy usage, gender diversity, ESG governance and cybersecurity. The engagement may vary depending on different factors, such as the ownership stake in each portfolio company or current phase in the holding period.

Identified sustainability-related controversies are managed through a risk-based process, which may include fact-finding, engagement with management, agreeing corrective actions and timelines, and monitoring implementation.

Designated reference benchmark

N/A

Last updated 9 October 2026