Introduction

The biotech, healthtech, and life sciences sectors are known for pushing the boundaries of science and innovation. But with great innovation comes the responsibility to ensure that these advancements align with strong ESG practices. As companies in these industries aim to improve patient outcomes and address critical medical needs, they face growing pressure to uphold sustainability standards —whether it's in responsible R&D, ethical animal testing, or ensuring equitable access to medicines. Investment firms like Asabys must balance these challenges while ensuring that their portfolio companies align with ESG standards and regulations.

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Asabys: navigating sustainability strategy & compliance

Asabys Partners is a venture capital firm with a clear mission: to back companies that are transforming the healthcare landscape. With €300M AUM and an active portfolio of 17 companies, Asabys is committed to driving meaningful social and environmental impact, while providing financial returns. Headquartered in Barcelona, Asabys invests primarily across Europe backing companies that address unmet medical needs.

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At Asabys, sustainability isn’t just a buzzword—it’s a core part of the investment strategy. Led by Maite Malet (Investment & Corporate Development) and Núria Aloy (CFO), the firm actively promotes sustainability practices across its portfolio, with a particular focus on social indicators and gender diversity. However, with a growing portfolio and increasing regulatory requirements, Asabys needed a partner to help them streamline their ESG efforts and ensure they were not only compliant but also leading the way in sustainability.

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Maite Malet explains: “Núria and I wanted to go beyond basic compliance. We needed a solution that not only integrates and monitors material ESG indicators but also guides early-stage biotech and healthtech companies by suggesting relevant KPIs and specific next steps. This adds real value, by helping the companies understand what actions to take and prioritize to improve their sustainability practices.”

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Consolidating ESG efforts in a complex regulatory environment

Asabys faced three main key challenges in integrating and managing their ESG initiatives:

1. Navigating multiple frameworks

Over time, Asabys adopted various international ESG standards. However, managing multiple frameworks where different standards apply, generated confusion and extra work both to Asabys but also their portfolio companies, not giving a clear picture of where they all stand. They needed to streamline these frameworks into a cohesive process that could be applied consistently across all portfolio companies while ensuring compliance with international standards.

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‍2. Focusing on healthcare-specific materiality

While there are plenty of general ESG indicators available for start-ups, only a few are truly relevant for the early-stage biotech, medical device, and digital health companies that Asabys invests in. They needed to identify and focus on the specific metrics that mattered most to their portfolio.

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3. Meeting compliance and LP reporting expectations

‍Asabys' latest fund is classified under SFDR Article 8, which means they are required to provide early and detailed disclosures. Beyond just meeting these requirements, Asabys wanted to stay ahead of changing regulations and create a reporting system that wouldn't need constant updates.

They also wanted to provide relevant information to their LPs, besides pure financial results, that shows the impact that all portfolio companies are having from a social, governance and environmental perspective, while keeping their operations efficient.

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Kara’s approach to ESG integration at Asabys

To tackle these challenges, Asabys partnered with Kara to deliver a best-in-class scalable solution. The main ingredients for success were:

Sector-specific indicators

Understanding that one size doesn’t fit all, Kara worked with Asabys to develop a specific set of indicators that truly reflected the unique challenges and opportunities within biotech and healthtech. Kara analyzed large data sets from multiple frameworks, such as IRIS+, Venture ESG, SASB and others, and ultimately focused on the most relevant aspects, such as ethical R&D practices, patient data security and access to medicines.

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Automation and reporting

Kara’s platform fully automated the data collection process, reducing reporting time by 80%, and freeing up the Asabys team to focus on what they do best —identifying and supporting the next generation of healthcare innovators. With real-time dashboards and automated reports, Asabys can easily share insights with LPs and regulatory bodies, ensuring full compliance with SFDR.

​​Kara’s platform also provided real-time reporting capabilities that allowed Asabys to meet LP demands for detailed ESG disclosures, helping to increase transparency and build trust with investors.

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Consolidated data infrastructure

Kara provided a centralized platform that aggregated ESG data from multiple sources and portfolio companies into one streamlined system. This allowed Asabys to efficiently track the most relevant ESG indicators across their entire portfolio, eliminating the administrative burden of managing data from different entities.

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‍Regulatory support‍

Keeping up with changing regulations is no easy feat, but Kara’s platform made it manageable. With a dashboard that is regularly updated with regulatory changes and built-in compliance checks, Asabys could avoid potential penalties, safeguard its reputation, and maintain investor confidence. This proactive approach ensured long-term success and enhanced trust with their investors.

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The results

Strengthened ESG culture at the firm level

Kara’s platform has not only simplified operations but has also instilled a deeper commitment to ESG within Asabys as a management company. By providing real-time data and automating reporting processes, Kara has enabled Asabys to embed ESG best practices into its core management strategies. This has led to more cohesive decision-making across teams, fostering a firm-wide culture of responsibility and compliance. As a result, Asabys has elevated its governance, ensuring that ESG principles are consistently prioritized at every level of the firm, aligning with both internal goals and external stakeholder expectations.

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Enhanced portfolio management and impact

‍At the portfolio level, Kara’s platform has enabled Asabys to standardize ESG practices across all investments, resulting in improved risk management and better long-term outcomes. By integrating industry-specific ESG indicators, Asabys can focus on the most material issues for each portfolio company, driving meaningful change while effectively tracking and measuring impact. This approach has ensured that Asabys stays ahead of regulatory demands and meets the evolving expectations of investors.

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Regulatory compliance

Kara’s platform has been instrumental in helping Asabys stay compliant with SFDR Article 8 and other evolving regulations. The ability to monitor and adapt to regulatory changes in real time has not only protected Asabys from potential penalties but also enhanced their reputation as a leader in responsible investment.

"We aimed to ensure that our portfolio companies, already making strides in healthcare innovation, align their practices with robust ESG standards. Kara provided us with the tools to streamline ESG integration, enhance portfolio management, and navigate regulatory complexities effectively, ultimately driving sustainable impact across our investments.”- Maite Malet