Corporate statements

STATEMENT UNDER S.54 OF THE MODERN SLAVERY ACT 2015

1. Introduction

This modern slavery statement is published pursuant to section 54 of the Modern Slavery Act 2015 (the “Act”) and covers the financial year 1 January 2023 to 31 December 2023. The statement outlines the steps we have taken during the year to prevent modern slavery from occurring in our business and supply chain and demonstrates our commitment to compliance with the Act.

2. About Cubico

Cubico Sustainable Investments is a global leader in providing renewable energy. We have operations in 9 countries and our portfolio includes onshore wind, solar photovoltaic, solar thermal and transmission and distribution line technologies. We are headquartered in London, UK and have regional offices in Australia, Colombia, Greece, Italy, Mexico, Spain, Uruguay and the USA.

Covering the entire energy chain, from development, construction and operation, we add clean energy to local electricity grids, thereby decreasing the world’s reliance on more carbon-intensive coal and natural gas.

We are acutely aware of the role we have as ESG stewards and operating to high ethical standards is central to our organisation.

3. Risk Assessment

Corporate Activities

Our corporate activities are undertaken at our regional offices with employees performing skilled activities including project origination and execution, managing development and construction activities, managing assets on a day-to-day basis and corporate services (finance, tax, legal and HR). Our corporate activities have very low dependence on temporary workers and contractors and the work undertaken is of a professional nature.

We consider the risk of modern slavery occurring in our corporate activities to be low. This is based on the very low numbers of outsourced staff, a professional, office environment with highly skilled work being undertaken and our high internal operating standards. However, we remain vigilant to the risks particularly with respect to the limited number of low skilled outsourced labour that we engage at our offices in higher risk jurisdictions (such as cleaning and maintenance services).

Development, Construction and Operational Activities

Our development, construction and operational activities constitute the development, construction and operation of renewable energy and transmission / distribution assets ‘on the ground’. All outsourced construction, operation and maintenance and asset management activities are managed through commercially agreed contracts on a medium or long term basis and include comprehensive ethical compliance and modern slavery obligations and undertakings.

We have assessed the risks of modern slavery occurring in our development, construction and operational activities and identified key areas of focus to be:

• Our high-risk jurisdictions: Cubico has a global footprint and operates in a number of jurisdictions. Some of those jurisdictions pose a higher risk than others and are monitored more closely as a result.
• Outsourcing of operational activities: Whilst Cubico predominantly contracts with large, well-established suppliers we acknowledge that they do not always have their own directly employed local work forces in the remote locations of some of our projects.
• The nature of the work undertaken, including:
  • construction of assets and the infrastructure that supports them;
  • outsourcing of operation and management activities associated with finished assets; and
  • outsourcing of low skilled maintenance work at assets, particularly in higher risk jurisdictions.
• Risks of forced labour in the supply chain of polysilicon (a key component of PV solar panels) originating from Xinjiang, China.

Slavery and trafficking risks are already taken into account in the assessments made when Cubico is deciding whether to acquire or develop assets in a new country.  Cubico’s Compliance team has a central role in advising the organisation on those risks.

4. Our Controls

Our governance model includes a number of controls to mitigate the risks of modern slavery and human trafficking throughout our business and supply chain and ensures we meet our commitment of adhering to the principles of the UN Global Compact, which includes labour and human rights.

Governance and Policies

Cubico understands that ethical conduct is not just a moral imperative but also a fundamental aspect of sustainable business operations, essential for our long term success. Cubico’s Executive Committee sets the tone from the top and promotes a culture of ethical conduct at every level of our organization.

Cubico has a dedicated Compliance Officer who maintains, and is responsible for, the comprehensive Ethical Compliance Programme. The Compliance Officer works closely with our Procurement, Internal Audit and Legal functions and reports periodically to the Audit and Risk Committee.

Cubico’s Ethical Compliance Programme includes a number of Compliance Policies such as the Code of Conduct, ABC Policy, Procurement & KYC Policy and Supplier Code of Conduct. We also publish Corporate Compliance Statements which make it clear that good corporate governance and the professional ethics of our employees and suppliers are the pillars upon which Cubico’s activities are based.

In particular, the Supplier Code of Conduct sets the standards that Cubico expects from its suppliers, joint venture partners, sellers, developers, acquisition targets, service providers and other stakeholders with whom we engage (together referred to as “Third Parties”) with respect to forced labour, slavery and similar practices and makes clear that we have a zero tolerance approach. Our Supplier Code of Conduct was refreshed and enhanced in 2023 and shared with key Third Parties.

We place a contractual obligation on all medium and high risk Third Parties to adhere to our Supplier Code of Conduct and include forced labour representations and warranties in contracts, giving us a termination right if breached. We also include a contractual right to audit Third Parties where appropriate to ensure they operate in line with our ethical standards.

KYC Reports and Due Diligence

In order to ensure we only work with those who share our values we perform KYC screening prior to engaging with medium and high risk Third Parties. The screening assesses the legal and compliance risks of our Third Parties, including the risks of modern slavery, and highlights adverse media relating to previous modern slavery related incidents.  During 2023 no KYC reports were generated which raised specific concerns with respect to modern slavery.

Where we acquire a new business or asset we request the seller and target to complete a Compliance Questionnaire as part of the due diligence process which includes questions relating to modern slavery and the controls they have in place to mitigate risks.

Ethical Compliance Risk Assessments and Audits

A key role of Cubico’s Compliance Officer is to visit the countries we operate in periodically and conduct ethical compliance risk assessments and audits. The scope of these includes a review of modern slavery risks and controls. In 2023 our Compliance Officer visited our offices in Mexico and the USA.

We also perform high level audits of our key Third Parties, focusing the policies and procedures they have in place to mitigate ethical compliance risks.

Ethical Compliance Training

All Cubico employees undertake annual Ethical Compliance Training, which includes Modern Slavery training. Furthermore, certain employees periodically complete Modern Slavery e-learning.

Site Visits

Our Head of HSE regularly undertakes site visits. During such visits he assesses modern slavery risks which enhances our risk management practices and controls. Cubico’s Executive Committee and Country Heads do a number of on-site safety walks every year which include an assessment of compliance and modern slavery risks. No areas of specific concern were identified which required further action or investigation with respect to modern slavery.

Whistleblowing Procedure

Cubico is committed to identifying inappropriate and illegal conduct in our business and remedying wrongdoing. To this end Cubico maintains an external, independent whistleblowing hotline which is promoted widely internally and externally to employees and Third Parties who are encouraged to report any concerns about modern slavery or unethical practices without fear of retaliation. No reports relating to modern slavery concerns were received in 2023.

Industry Risks relating to Polysilicon

Polysilicon, a key component in the manufacture of solar panels, which originates from Xinjiang, China has been linked to potential forced labour risk. Consequently, Cubico has taken a number of steps to avoid sourcing solar panels tied to forced labour and to ensure compliance with new forced labour regulations in key markets. We took part in a Supply Chain Exposure Risk Assessment of panel manufacturers in Southeast Asia, organized by an independent auditor. We can access the results of the assessments, as required, which enable us to make a more informed decision when selecting panel providers.

Our Compliance Officer, Procurement and Legal teams have also implemented enhanced governance controls, such as including comprehensive forced labour contractual protections in panel supply agreements, which provides an additional safeguard to prevent Cubico from obtaining production materials derived using illicit labour practices.

5. Future Actions

We remain committed to combating the risks of modern slavery and it is a key priority for Cubico’s Compliance team, alongside the Internal Auditor and Procurement Manager. In particular, we will:

• continue to develop our risk analysis and selection of Third Parties by conducting ongoing KYC and reviewing, refreshing and, as appropriate, reissuing our Compliance Questionnaire;
• continue to carry out Ethical Compliance Risk Assessment and Audits at our offices to assess the level of modern slavery risks and react accordingly;
• continue to conduct Compliance Audits of key Third Parties to ensure they have appropriate modern slavery controls within their business or supply chains;
• continue to embed employees’ understanding of modern slavery risks through training and so that they remain vigilant and follow the controls that we have in place to reduce these risks;
• continue to carry out due diligence and audits on Third Parties and our own assets via site visits conducted by our Head of HSE, Executive Committee and Country Heads;
• continue to enforce the requirements of the Supplier Code of Conduct;
• ensure additional due diligence is undertaken and appropriate controls put in place when entering into panel supply agreements; and
• continue to advertise our whistleblowing hotline both internally to employees and externally to our Third Parties.

This statement is made by Cubico Sustainable Investments Limited and the board of directors of the company have approved it and will update it annually.