## Outstanding long-term ## track record ### Pantheon International Plc Annual Report and Accounts 2022 Strategic Report Manager’s Review Governance Financial Statements Other Information ### Pantheon International Plc Annual Report and Accounts 2022 ## Celebrating 35 years of investing in growing companies with the best performing ## private equity managers Celebrating 35 years Case study: EUSA Pharma Case study: Seqens EXIT NEW INVESTMENT | 35 years of | | | Treating childhood | | | Securing | | | --- | --- | --- | --- | --- | --- | --- | --- | | outperformance | 04 | | cancers and | 70 | | pharmaceutical | 112 | | | | | providing hope | | | supply chains | | | Case study: Satlink | | | Case study: Accelerant | | | Q&A with Insight Partners | | | | | ESG | | | NEW INVESTMENT | | | ### Upholding ethical Capturing early ###  42 106 growth in software 72 ### businesses Full contents Available here, throughout the report Strategic Report Manager’s Review Governance Financial Statements Other Information Pantheon International Plc BStrategic Report 2022 ### Disrupting the global ### insurance market Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Pantheon International Plc Annual Report and Accounts 2022 Contents | Strategic Report | Manager’s Review | Financial Statements | | --- | --- | --- | | About PIP 02 | Portfolio 57 | Income Statement 163 | | 35 years of PIP 04 | Performance 59 | Statement of Changes in Equity 164 | | Why Choose Us 05 | Our Market 63 | Balance Sheet 165 | | Chair’s Statement 16 | A Conversation with Insight Partners 72 | Cash Flow Statement 166 | | Key Performance Indicators 22 | Sector Themes 75 | Notes to the Financial Statements 167 | | Our Strategy 27 | Distributions 82 | | | Our Business Model 31 | Calls 96 | Other Information | | Investment Policy 37 | New Commitments 99 | | AIFMD Disclosures 191 Responsible Investment and ESG 38 Buyout Analysis 114 Alternative Performance Measures 193 Financing Our Undrawn Commitments 44 Other Information 117 Glossary of Terms 197 Risk Management and Principal Risks 46 Key Pantheon Personnel Supporting PIP 128 Directors and Advisers 199 s172(1) Statement 50 Viability Statement 55 Governance Board of Directors 133 Retail investors advised by independent Directors’ Report 135  The Company currently conducts its affairs Statement on Corporate Governance 140 so that its shares can be recommended by  Audit Committee Report 147 investors in accordance with the FCA’s rules in Directors’ Remuneration Report 150 relation to non-mainstream investment products. The shares are excluded from the FCA’s Directors’ Responsibility Statement 153 restrictions which apply to non-mainstream investment products because they are shares Independent Auditor’s Report to the in a UK-listed investment trust. Members of Pantheon International Plc 154 Pantheon International Plc 01Strategic Report Pantheon International Plc 01Strategic Report Manager’s Review Governance Financial Statements Other Information 2022 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts Annual Report and Accounts ### About PIP ## Making the private, public ### A share in PIP provides access to a high-quality ### PIP ###  ### world that would otherwise be inaccessible to many Pantheon International Plc (“PIP” or the “Company”) PIP is overseen by an independent investors. Shares in PIP can be bought and sold as is a listed FTSE 250 private equity investment trust, Board of Directors from a wide range actively managed by Pantheon, one of the leading of backgrounds. ### they would in any other publicly listed company. private markets investment managers globally. ### This year, PIP celebrates 35 years of delivering ### exceptional performance ahead of public market ### benchmarks over the long term. Supervises As at 31 May 2022 | +31.0% | +12.4% | | | Oversees | | | | --- | --- | --- | --- | --- | --- | --- | | NAV per share growth | Average annual NAV growth | | | | | | | | | Shareholders | PIP | | PIP Board | Pantheon | | in the year (net of fees) | since 1987 (net of fees) | | | | | | Invest via LSE ## £2.4bn £1.6bn Net asset value Market capitalisation Manages ## +8.6% 1.15% 1 Share price increase in the year AIC ongoing charges   Strategic Report Pantheon International Plc 02 Pantheon International Plc 02 2022 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts Annual Report and Accounts ### About PIP ## Managed by a leading private equity investor ### Selecting, accessing and partnering with the ### PANTHEON ### best private equity managers globally with ### robust organisations, proven operational and Pantheon provides ### sector expertise, and a sustainable investment  DUBLIN BERLIN to its global network ### 10 ### strategy is key to achieving attractive returns. 1 of relationships… SEOUL CHICAGO ### 4 For the past 40 years, ### 5 LONDON NEW | | | Pantheon has built up | YORK | | TOKYO | | --- | --- | --- | --- | --- | --- | | 1 | 2 | | | 293 | | | | | an extensive network of | 52 | people | | ### 5 | US$87.8bn | 121 | | | | | --- | --- | --- | --- | --- | | | | relationships with private | SAN | HONG | | | | | FRANCISCO | KONG | | Assets under management | investment professionals | equity managers across | | | | | | | 34 | 10 | the world. Thanks to BOGOTÁ TEL AVIV 3 Pantheon’s privileged ### 4 1 access, PIP is able to invest ## >865 c.10,000 in invitation-only funds, institutional investors globally private equity managers in co-invest directly in attractive Pantheon’s database private companies, and participate in exclusive | | | 1 | secondary deals. | | --- | --- | --- | --- | | 10 | >560 | | | |  | advisory board seats held | | | 5 Award-winning asset manager ## A+ 4 | | 15 years of UN PRI | awarded to Pantheon | | --- | --- | --- | | | membership, one of | for private equity by | | 1 As at 31 March 2022. |  | the UN PRI in 2020 | | 2 As at 30 June 2022. | signatories | | 3 A location from which executives of the Pantheon Group perform client service  4 United Nations Principles for Responsible Investment. 5 See the Awards Methodologies & Disclosures section on Pantheon’s website for details regarding the awards mentioned above: www.pantheon.com. Pantheon International Plc 03Strategic Report Pantheon International Plc 03 2022 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts Annual Report and Accounts ### 35 years of PIP ## Award-winning leading listed ## private equity investment trust 1987 2007 2013 2014 2015 2016 2018 2020 2021 2022 | IPO raised £12m | Pantheon | Co-investments | Single asset | |  | | --- | --- | --- | --- | --- | --- | | to invest in the | becomes one | added to | | secondaries | 35 years of | | primary and | of the early | investment | | added to |  | | secondary | signatories | strategy | | investment | | PIP’s website was market of the strategy shortlisted for an UN PRI AIC Shareholder Communications award PIP’s NAV PIP’s NAV Inclusion in the NAV of £2.4bn as reached £500m reached £1bn FTSE 250 with at 31 May 2022 a market capitalisation of £1bn ## 19 7 2022 ## 8 ## 4 ## £12m £2. bn Strategic Report Pantheon International Plc 04 Pantheon International Plc 04 2022 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts Annual Report and Accounts ### Why Choose Us ### An outstanding track record: ## Consistent outperformance ### since its inception in 1987, PIP has ### outperformed the FTSE All-Share ## over 35 years ### and the MSCI World indices. SINCE INCEPTION IN 1987 | +12.4% | | +4.8% p.a. | | +4.0% p.a. | | | --- | --- | --- | --- | --- | --- | | Average annualised NAV | | NAV outperformance | | NAV outperformance relative | | | | 1 | | 1 | | 1 | | per share growth (net of fees) | | relative to the FTSE All-Share | | to the MSCI World (Sterling) | | 1 As at 31 May 2022. Strategic Report Pantheon International Plc 05 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ## Why Choose Us PIP has a 35-year history of outperformance with an average annual NAV growth of 12.4% per year. The Company has delivered this return, which is net of fines to shareholders through numerous economic cycles. Long-term outperformance Maximising capital growth ![img-0.jpeg](img-0.jpeg) Strategic Report Manager's Review Governance Financial Statements Other Information and Research International Plc Annual Report and Accounts 2022 2022 ### Why Choose Us PIP’s NAV and share price have outperformed the MSCI World and  FTSE All-Share indices over the long term.  Since 1 yr 3 yrs 5 yrs 10 yrs inception NAV per share      Ordinary share price      ### Long-term outperformance FTSE All-Share, Total Return      MSCI World, Total Return (Sterling)      ### Maximising capital growth  Since 1 yr 3 yrs 5 yrs 10 yrs inception Versus FTSE All-Share, Total Return      Versus MSCI World, Total Return (Sterling)       Since 1 yr 3 yrs 5 yrs 10 yrs inception Versus FTSE All-Share, Total Return      Versus MSCI World, Total Return (Sterling)      Strategic Report Pantheon International Plc 07 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Why Choose Us ###  ## Resilient and actively managed ### managed portfolio provides ### exposure to exciting, high-growth ## portfolio with embedded value ### businesses around the world. SINCE 2012 ## +31% +24% p.a. +15% p.a. +16% p.a. 1 | Value-weighted | Average distribution rate | Buyout portfolio company | | Buyout portfolio company | | | --- | --- | --- | --- | --- | --- | | | | | 1 | | 1 | | average uplift on | | average revenue growth | | average earnings growth | | 1 exit realisations 1 As at 31 May 2022. Strategic Report Pantheon International Plc 08 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Why Choose Us PIP’s portfolio is carefully stewarded and has been actively managed to: Uplifts demonstrate embedded value in PIP’s portfolio – increase the concentration of high-conviction investments; – invest in more direct company holdings; – allocate further capital to promising industry segments; and 42% 40 –  36% 36% generation of the portfolio. 35% 34% We have increased PIP’s exposure to more resilient and 31% 30 | high-growth sectors such as Information Technology, | | | 28% | | | --- | --- | --- | --- | --- | | | 26% | | | 26% | | Healthcare and Consumer Staples and Services. | | 25% | | | 22% 20 ### Uplifts achieved at exit 10 50 ### Cash generative portfolio 0 30 June 30 June 30 June 30 June 30 June 30 June 31 May 31 May 31 May 31 May 31 May 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 PIP FINANCIAL YEAR ### Buyout portfolio company revenue and ### earnings growth ### Dynamic asset allocation ###  VALUE-WEIGHTED AVERAGE UPLIFT ON EXIT (%) Strategic Report Pantheon International Plc 09 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Why Choose Us PIP’s portfolio is carefully stewarded and has been actively managed to:  – increase the concentration of high-conviction investments; – invest in more direct company holdings; – allocate further capital to promising industry segments; and –  30 29% 29% generation of the portfolio. 27% 25% | We have increased PIP’s exposure to more resilient and | | | 25% | | | | --- | --- | --- | --- | --- | --- | | | 24% | | | 24% | | | high-growth sectors such as Information Technology, | | 22% | | | 22% | Healthcare and Consumer Staples and Services. 20 17% 17% ### Uplifts achieved at exit 10 40 ### Cash generative portfolio 0 30 June 30 June 30 June 30 June 30 June 30 June 31 May 31 May 31 May 31 May 31 May 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 PIP FINANCIAL YEAR ### Buyout portfolio company revenue and ### earnings growth ### Dynamic asset allocation ANNUALISED DISTRIBUTION RATE (%) ###  Strategic Report Pantheon International Plc 10 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Why Choose Us PIP’s portfolio is carefully stewarded and has been actively managed to: Resilient revenue and earnings growth – increase the concentration of high-conviction investments; – invest in more direct company holdings; – allocate further capital to promising industry segments; and | | | 25% | 25% | | | 25% | | --- | --- | --- | --- | --- | --- | --- | | | 25 | | | 25 | | | | –  | | | | | 23% | | generation of the portfolio. 21% 20% 20 20 We have increased PIP’s exposure to more resilient and 18% 18% high-growth sectors such as Information Technology, Healthcare and Consumer Staples and Services. | | 15% | | | | 15% | | --- | --- | --- | --- | --- | --- | | 15 | | | | 15 | | | | | 13% | 13% | | | 12% 11% 11% 11% 10% | | 10 | | 10 | | | | --- | --- | --- | --- | --- | --- | | Uplifts achieved at exit | | | | | 9% | | | | 8% | | 8% | | 5 5 30 30 30 30 ### Cash generative portfolio | | | | | 0 | | | | | | | | | | | 0 | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | 25% | 25% | | | | | | | | 25% | | | | | | | | | | | | | | | | | 25 | | | 25 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 23% CALENDAR YEAR CALENDAR YEAR ### 21% Buyout portfolio company revenue and 20% 20 20 ### earnings growth | | | | | | | | 18% | 18% | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | 15% | | | | | 15% | | | | 15 | | | | | 15 | | | | | | | 13% | 13% | Dynamic asset allocation | | | | | 12% 11% 11% 11% 10% 10 10 9% 8% 8% ### 5  5 BUYOUT PORTFOLIO COMPANY REVENUE GROWTH (%) BUYOUT PORTFOLIO COMPANY EBITDA GROWTH (%) BUYOUT PORTFOLIO COMPANY EBITDA GROWTH (%) BUYOUT PORTFOLIO COMPANY REVENUE GROWTH (%) 0 0 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | | | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Strategic Report | | | | | | | | | | | Pantheon International Plc 11 | 2022 | | | | | CALENDAR YEAR | | | | | | | | | | | | CALENDAR YEAR | | | | | | | | | | | | | | | | | | | | Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts | | | | | | | | | | | | | | ### Why Choose Us PIP’s portfolio is carefully stewarded and has been actively managed to:   – increase the concentration of high-conviction investments; – invest in more direct company holdings; 800 80 – allocate further capital to promising industry segments; and 600 60 –  generation of the portfolio. 40 400 We have increased PIP’s exposure to more resilient and 20 200 high-growth sectors such as Information Technology, 0 0 Healthcare and Consumer Staples and Services. Jun Jun Jun Jun Jun Jun May May May May May Jun Jun Jun Jun Jun Jun May May May May May 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Directs Funds ### Uplifts achieved at exit Marked shift towards direct company investments,  which are comprised of co-investments and  single-asset secondaries. | 100 | 100 100 | | 100 | | | | | --- | --- | --- | --- | --- | --- | --- | | | | Cash generative portfolio | | Investment type | | Weighted average portfolio age | | | 80 | | 80 | | | | | 80 | 80 | | | | | | | 60 | 60 | | 60 | | | | | | 60 | | | | 80 | | 6 40 40 40 40 ### Buyout portfolio company revenue and 60 4 PORTFOLIO NAV (%) 20 PORTFOLIO NAV (%) 20 20 ### 20 earnings growth 40 0 0 0 0 2 20 | Jun | Jun | Jun | Jun | Jun | Jun | May | May | May | May | May | Jun Jun | Jun Jun | Jun Jun | Jun Jun | Jun Jun | Jun Jun | May May | May May | May May | May May | May May | Jun | Jun | Jun | Jun | Jun | Jun | May | May | May | May | May | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2012 2012 | 2013 2013 | 2014 2014 | 2015 2015 | 2016 2016 | 2017 2017 | 2018 2018 | 2019 2019 | 2020 2020 | 2021 2021 | 2022 2022 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | 0 | | | | | | | | | 0 | ### Dynamic asset allocation | | | | | Jun | Jun | Jun | Jun | Jun | Jun | May | May | May | May | May | Jun | Jun | Jun | Jun | Jun | Jun | May | May | May | May | May | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | | 1,000 100 | 1,000 100 100 | 8 | 100 | | | | | | | | | | | | | | | | | | | | | | | 8 Primaries Fund secondaries 800 Manager-led secondaries Co-investments 80 80 6 | |  | | |  | | --- | --- | --- | --- | --- | | 600 | | 60 | | | | 60 | | | Portfolio managed to maximise growth and liquidity | naturally cash-generative | 4 over time. portfolio. 400 YEARS PORTFOLIO NAV (%) YEARS PORTFOLIO NAV (%) 40 40 | 200 | | 2 | | --- | --- | --- | | PORTFOLIO NAV (%) 20 | PORTFOLIO NAV (%) | 20 | | NUMBER OF COMPANIES | NUMBER OF COMPANIES | | | 0 0 | | 0 | 0 | | | | | | | | | | | | | | | | | | Strategic Report | | | | | | | | | | | | | | | | | | | | | Pantheon International Plc 12 | 2022 | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | Jun Jun | Jun Jun | Jun Jun | Jun Jun | Jun Jun | Jun Jun | May May | May May | May May | May May | May May | | | | | | | | | | | | | | | Jun Jun | Jun Jun | Jun Jun | Jun | Jun Jun | Jun Jun | May May | May May | May | May May | May May | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Jun | | | | | May | | | | | | | | 2012 2012 | 2013 2013 | 2014 2014 | 2015 2015 | 2016 2016 | 2017 2017 | 2018 2018 | 2019 2019 | 2020 2020 | 2021 2021 | 2022 2022 | | | | | | | | | | | | | | | 2012 2012 | 2013 2013 | 2014 2014 | 2015 | 2016 2016 | 2017 2017 | 2018 2018 | 2019 2019 | 2020 | 2021 2021 | 2022 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2015 | | | | | 2020 | | | | | | | | | | | | | | | | | | | Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,000 | | | | | | | | | | | | | 1,000 | 8 | | | | | | | | | | | | 8 | | | | | | | | | | | | | | | 800 | | | | | | | | | | | | | 800 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6 | | | | | | | | | | | | 6 | | | | | | | | | | | | | | | 600 | | | | | | | | | | | | | 600 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 4 | | | | | | | | | | | | 4 | | | | | | | | | | | | | | | 400 | | | | | | | | | | | | | YEARS PORTFOLIO NAV (%) 400 | | | | | | | | | | | | | YEARS PORTFOLIO NAV (%) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2 | | | | | | | | | | | | 2 | | | | | | | | | | | | | | | 200 | | | | | | | | | | | | | 200 | | | | | | | | | | | | | | | | | | | | | | | | | | | | NUMBER OF COMPANIES | | | | | | | | | | | | | NUMBER OF COMPANIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 0 | | | | | | | | | | | | | 0 0 | | | | | | | | | | | | 0 | | | | | | | | | | | | | | | | | Jun | Jun | Jun | Jun | Jun | Jun | May | May | May | May | May | | | Jun Jun | Jun Jun | Jun Jun | Jun Jun | Jun Jun | Jun Jun | May May | May May | May May | May May | May May | | Jun | Jun | Jun | Jun | Jun | Jun | May | May | May | May | May | | | | | | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | | | 2012 2012 | 2013 2013 | 2014 2014 | 2015 2015 | 2016 2016 | 2017 2017 | 2018 2018 | 2019 2019 | 2020 2020 | 2021 2021 | 2022 2022 | | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | | | ### Why Choose Us Increasing the portfolio’s concentration ensures more meaningful investments in high-quality funds and companies  for PIP. | | | 2 | | | | 2 | | | --- | --- | --- | --- | --- | --- | --- | --- | | Number of managers (2015 vs current) | | | |  (2015 vs current) | | | | | | 90 | | | | 742 | | | | 90 | | | | 90 | | | | | 80 | | | | 80 | | | | | | | | 70 | | | | 597 | | 70 | | | | 70 | | | | | 60 | | | | 60 | | | | | 50 | | | | 50 | | | | ### Uplifts achieved at exit | 40 | 40 | | --- | --- | | 30 | 30 | | 20 | 20 | ### Cash generative portfolio | | 10 | | | 10 | | | | --- | --- | --- | --- | --- | --- | --- | | | 0 | | | 0 | | | | 100 100 | | | | | | | | | | June 2015 | May 2022 | | June 2015 | May 2022 | ### Buyout portfolio company revenue and ### earnings growth | | -22% | | -20% | | | --- | --- | --- | --- | --- | | Dynamic asset allocation | Decrease in number of managers comprising 80% of | | Decrease in number of companies comprising 80% of | | | | | 1 | | 1 | | | PIP’s total exposure | since 2015 | PIP’s total exposure | since 2015 | 1 Exposure is equivalent to the sum of the NAV and undrawn commitments. ###    Exposure is equivalent to the sum of the NAV and undrawn commitments. Strategic Report Pantheon International Plc 13 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Why Choose Us ### Pantheon has a responsible approach when making ## Thoughtful approach ### investments on behalf of PIP. Adherence to sound ### Environmental, Social and Governance (“ESG”) principles ## to responsible investment ### has been incorporated in our pre- and post-investment ### processes for several years and Pantheon will continue to ###  ### Diversity & Inclusion in private equity. ### Read more about 38 ### our approach to ESG Signatory of: Strategic Report Pantheon International Plc 14 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Why Choose Us  Pantheon is committed to incorporating Pantheon continues to enhance its sound Environmental, Social and approach to ESG and this year has initiated ### 1 2 3 Governance (“ESG”) standards in the an annual survey of its private equity operation of its business, and in its managers to provide Pantheon with ###  up-to-date information on the private Deal screening Due diligence Post-investment stakeholders, including clients, local equity managers and their ESG credentials. ### monitoring communities and society in general. Pantheon is committed to advocating for As one of the early signatories to the sound ESG practices across the private – Pantheon Exclusions – Primaries: Private equity – Private equity manager’s UN Principles for Responsible Investing equity industry, using its position on Policy: avoid manager ESG integration ESG reporting and 1 | (“UNPRI”) in 2007, and a pioneer of ESG | over 560 | advisory boards worldwide to | investments | assessed by Pantheon | Advisory Board | | --- | --- | --- | --- | --- | --- | | | | | in certain sectors. | (Low/Medium/High). | engagement. | | practices in private markets, Pantheon has | promote high ESG standards on behalf | | | | | | deeply embedded comprehensive ESG | of PIP amongst private equity managers | | – ESG checklist. | – Co-investments: | – Continuous company | | policies into its investment processes, | and investee companies. | | | Targeted company | ESG risk assessment, | – RepRisk company review at acquisition, using RepRisk. from the initial screening of opportunities, screening.  with RepRisk rating through due diligence and post-investment – Pantheon receives live equal opportunity and inclusion. There is a assigned. This includes monitoring. RepRisk, a third-party news  sector, country and | |  | | affecting portfolio | | --- | --- | --- | --- | | information service, has been fully | | overall risk (AAA to D), | | | | more diverse organisations make better | | companies. | | integrated into Pantheon’s pre- and | | and private equity | | | | decisions and enrich the communities | manager ESG rating. | | | post-monitoring processes since 2017. | | | – Initiated an annual | | | that they operate in. | | ESG survey of our | – Secondaries: Targeted private equity managers. company review at acquisition and assessment of ESG approach of private equity manager.  Investee Companies   1 As at 31 March 2022. Strategic Report Pantheon International Plc 15 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Chair’s Statement ## 35 years of ## outperformance:   Chair ## A compelling investment ### PIP is one of the longest established private equity investment ## success story ### companies listed on the London Stock Exchange. This year th ###  anniversary, having been launched with ### £12m NAV in 1987 and grown its NAV to £2.4bn at the end ### of 31 May 2022. | +31.0% | +12.4% | £2.4bn | | | | --- | --- | --- | --- | --- | | Record NAV per share | Average annual NAV | Net asset value | | | | | | | Over that period, PIP’s NAV per share |  | | growth in the year | growth since inception | | | | has outperformed annually, net of fees, For the year ended 31 May 2022, I am both the FTSE All-Share and MSCI World pleased to report that PIP’s NAV per share   ## +8.6% +11.3% +64.8%   Share price increase Average annual share Total shareholder work and skill of PIP’s manager, Pantheon, from favourable currency movements. in the year price growth since return (5Y) over so many years, and I would like to PIP’s share price, however, has grown at a inception thank them on behalf of all shareholders.  I should add that PIP has also outperformed  these indices over the most recent 1, 3, 5  ## +26.2% £232m 25% and 10-year periods.  Portfolio investment Record portfolio net cash Distribution rate for  return in the year  the year  of writing. Pantheon International Plc 16Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Chair’s Statement This widening of the discount in bear The value-weighted average uplift on exit markets was also seen in 2008 and is  NAV per share progression | a common feature across almost all | during the 12 months to 31 May 2022. | | | | | --- | --- | --- | --- | --- | | listed private equity vehicles. Over the | In the 11 years during which this measure | | | | | longer-term, however, the share price | has been tracked, the average uplift on the | | | | | return tracks that of the NAV per share |  | | | | | | | 24.6p | 0.8p (6.2p) | | | closely, and we therefore consider the | the NAV of those investments 12 months | | | 451.6p | 450p NAV per share to be a more consistent prior to realisation. 3.5p 84.1p and less volatile measure of performance.   The Board remains disappointed with the 400p value in portfolio discount of PIP’s share price and considers PIP’s longevity and proven track record the current elevated level relative to the suggest that its current share price value and prospects of its portfolio to 344.8p 350p |  | be unwarranted. Accordingly, it intends | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | portfolio and that, in keeping with the | to buy back shares actively to enhance | | | | | | | | | | | | | | | past, the discount will narrow once the | shareholder returns, while optimising | | | | | | | | | | | | | | | | | | | | +24.4% | | +1.0% +7.2% | | | | +0.2% | (1.8%) | | +31.0% | | economic outlook and market sentiment | long-term capital growth within a balanced | 300p | | | | | | | | | | | | | | improve. Furthermore, experience shows | portfolio in line with its investment policy. | | May | | Valuation | | Investment | | FX | | Share | Expenses | | May | | | | | | 1 | | 2 | | 2 | | 2 | | | | | | that PIP’s underlying managers value their | | | 2021 | | gains | | income | | impact | | buybacks | and | | 2022 | | | In addition, the Board has initiated with | | | | | | | | | | | | 2,3 | | taxes portfolios conservatively when applying Pantheon a concerted marketing effort fair valuation accounting standards to to promote the contribution that PIP can the measurement of NAV per share. provide to an investor’s portfolio and thereby attract new investors. This has included the recent appointment of a new PR agency, a refresh of the website and capital markets events planned for the ## 42% autumn. The Board believes that private Average uplift on exit realisations in the year equity is under-owned in many investors’ 500p portfolios and that PIP is an ideal solution  from the liquidity available through a listed company. 1 Adjusted for the 10 for 1 share split which took effect from 1 November 2021. The NAV per share is stated in pre-share split terms. 2 Figures are stated net of movements associated with the Asset Linked Note (“ALN”) share of the reference portfolio.   Pantheon International Plc 17Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts +31.6% ### Chair’s Statement  This work includes the realisation of investments, typically after a number of The level of fees charged by private equity  years, though private sale or IPO, followed managers is considered to be excessive by the distribution of the proceeds to by many commentators and prospective investors including PIP. The fees are high investors. Nevertheless, the evidence is in relation to those typically charged by that the best private equity funds generate fund managers in the liquid markets  35% because of the additional work involved. outperform the equity indices, and this is  21%  required and are deemed acceptable by the the years. 28% most sophisticated institutional investors 20% 17% Pantheon is one of the most experienced who have had portfolio exposure to private 200p investors in selecting, working with and equity for many years. investing in private equity funds, and The Board believes that the acid test over 40 years has built up privileged 100p of a private equity fund is that it should relationships with the best managers outperform net of fees, such that investors through both fund and direct investments. achieve a higher return than if they had 0p In many cases, new investors are unable invested in lower cost funds or indices. to access the best funds since they May 2018 May 2019 May 2021May 2020 May 2022 Pantheon’s key role in this is to secure are only made available to existing, investments in and work with the best FINANCIAL YEAR trusted investors.  Private equity managers build specialist, PIP’s shareholders as well as its other NAV per share Share price Discount skilled teams to source, evaluate and client investors. secure good investment opportunities, and then work with their portfolio companies to add value in a variety of ways, examples of which are demonstrated in our case studies. 500p 400p 300p Pantheon International Plc 18Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ## Chair's Statement ### Positive cash flow and balance sheet strength PIP receives cash distributions through the sale of its more mature portfolio assets while also making commitments to new direct company investments, and to funds, which are often drawn down by the fund managers over time. This year, PIP benefited from a record level of distributions including proceeds from ELISA Pharma, the largest sale of a single company in its history. ELISA Pharma is a specialty pharmaceutical company focused on oncology and rare diseases and was acquired by Italian pharmaceutical company Recordati in December 2021. This was a co-investment alongside one of our long-standing private equity managers and was sold at approximately 5.0 times multiple of cost. The case study on page 70 gives further details. ![img-1.jpeg](img-1.jpeg) During the year, PIP received distributions of £419m and disbursed £187m in capital calls from existing fund commitments. As a result, PIP generated net cash flow of £230m and ended the year with £227m in net available cash, which combined with its £383m multi-currency credit facility provided a total of £528m to meet future capital calls and make new investments. £500m New credit facility expiring in July 2027 I am delighted to report that, since the year end, PIP has agreed a new £500m five year facility to replace the £383m facility described above. This extended and enlarged facility further strengthens our financial resources and provides the Company with greater flexibility in managing its asset base to achieve an optimal investment exposure, including in difficult market conditions. Further details on our cash cover may be found on page 44. The unlisted Asset Linked Note ("ALN") of £39m, which is due to mature on 31 August 2027, is now relatively small and is continuing to be repaid from cash distributions received uniquely from a portfolio of older investments. ![img-2.jpeg](img-2.jpeg) ¹ Cash flows are stated net of investments associated with the ALN share of the reference portfolio. Strategic Report Manager's Review Governance Financial Statements Other Information Panthesn International Plc Annual Report and Accounts 2022 | 19 ### Chair’s Statement  PSOF amounts to £164.3m (US$ 225.0m). PSOF is focused on manager-led  single-asset secondaries, a sub-segment private equity investments, sourced of the secondaries market that typically through Pantheon’s extensive platform and ### comprises prized businesses in private Themes such as digitalisation and automation, ageing demographics, longstanding relationships with many of equity funds portfolios which the managers ### the best private equity managers globally.  know well and believe have excellent This portfolio includes investments in new potential to grow in value beyond the life ### funds raised, secondary purchases of portfolio towards high growth, more resilient sectors. of their fund. Nine such investments were assets being sold by investors in existing completed during the period. funds and, increasingly, direct investments   by invitation in companies alongside our In recent years the Board and Pantheon Chair private equity managers. The mix of have adopted a policy to increase portfolio investment between categories is actively concentration in a smaller number of managed by the Board and Pantheon over managers and companies while continuing time, most recently resulting in an increase  In addition to maintaining rigorous  in the portion of direct co-investments. This focus has included a tilt towards adherence to ESG principles, the Board sector specialists focused on long-term Pantheon became one of the earliest believes that Pantheon has an open and secular trends that are likely to continue to private equity adherents to ESG by signing inclusive internal culture which is evident in offer growth opportunities whatever the up to the UN Principles for Responsible its attitude towards clients as well as the prevailing economic environment. Themes Investment 14 years ago. Your Board way in which it interacts with the managers | | such as digitalisation and automation, | fully supports Pantheon’s longstanding | | | --- | --- | --- | --- | | £496m | | | with whom it invests. | | |  | commitment in this area which covers | | committed to 70 new investments in the year and environmental sustainability have  tilted the portfolio towards high growth, managers as well as their underlying 38 more resilient sectors such as information portfolio companies. The Board has an technology, comprising companies ESG sub-committee which meets formally During the year, PIP made commitments providing business-critical software and with Pantheon executives at least twice to 70 investments for a total of £496m, infrastructure with recurring revenues and a year as well as more frequently on an comprising £262m to 25 primary funds, cash generation, as well as healthcare, ad-hoc basis. £123m to 30 co-investments and £111m consumer staples and consumer services. to 15 secondaries with the latter including a PIP has relatively low exposure to £55.6m (US$ 75.0m) top-up commitment early-stage venture capital funds focused to the Pantheon Secondary Opportunity on technologies in which valuations Fund (“PSOF”). Combined with PIP’s  commitment to PSOF during the last  Pantheon International Plc 20Strategic Report 2022 Read more about our Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts approach to ESG ### Chair’s Statement |  | Outlook | the private equity market. In addition, | long-term relationships that Pantheon has | | --- | --- | --- | --- | | | | many of PIP’s private equity managers | built up with leading managers, PIP offers | | After 10 years of service, Susannah Nicklin | The global recovery from the COVID-19 | | | | | | employ dedicated debt specialists who | shareholders privileged access to a broad | | retired from the Board following the AGM | crisis has been upset by rising geopolitical | | | | | | are disciplined and experienced in their | selection of private equity investments. | | in 2021 and has been replaced as Senior | tensions, including the tragic war in | | | | | | use of leverage and in negotiating terms | Whereas investing directly in funds | | Independent Director by Mary Ann Sieghart. |  | | | | | | with lenders. | requires high minimum levels of | (particularly for energy, minerals and food), | Tamara Sakovska, who joined the Board on | | | commitment and illiquidity, PIP brings | | --- | --- | --- | --- | | | rising interest rates and uncertain supply |  | | | 1 March 2022, resigned as a Director of the | | | private equity within reach of small | | | chains has materially altered the outlook | equity managers will continue their | | | Company with effect from 22 July 2022. | | | institutions and retail investors while | | | for the economy and raised the spectre of | proven track record of managing their | | | Tamara accepted the role before the | | | providing immediate exposure to a | | | recession. The valuations of businesses in |  | | |  | | |  | | | public markets have already come under |  | | | subsequently indicated that her voluntary | | | of growth companies. | | | pressure and we are likely to see some | Pantheon, built up over 40 years, in | | relief efforts meant that she had limited follow through into PIP’s NAV, although navigating through several previous All of PIP’s Directors collectively own a total  we expect this to be cushioned in part by crises and economic cycles. of 2.6m shares in the Company valued at director of PIP. The Board is grateful to | | the embedded value in the portfolio that | | the time of writing at £7.0m. In addition, | | --- | --- | --- | --- | | Tamara for her brief contribution as a | | Since I joined the Board in 2011, the | | | | I discussed earlier. | | 15 Partners of Pantheon collectively hold | | Director and would like to extend its best | | availability of private equity capital for | | a further c.2m shares. wishes to her for the future. The Board will It is impossible to foresee how all the growing businesses has increased be starting a process with external search current economic and geopolitical substantially and now constitutes a core  consultants to appoint a new director in challenges will play out, particularly the war source of long-term investment funding. that PIP is well placed, with a resilient due course. in Ukraine and the sanctions on Russia. It is clear that this trend will continue as “all-weather” portfolio of companies, a PIP has no direct exposure to investments entrepreneurs and business managers strong balance sheet, an engaged Board Having served as a Director since 2011 in Ukraine or Belarus and the valuation of  of Directors, a very experienced Manager, and as Chair since 2016, I will be retiring its tiny exposure to Russian assets has ever-increasing regulation in listed and an expectation of continuing from the Board upon the conclusion of the been reduced to zero. markets, together with the focus on outperformance over the long term. forthcoming Annual General Meeting in short-term results. Private equity investors I shall remain a shareholder and extend October. Following a selection process led Pantheon monitors carefully the level are also increasingly preferred as owners my best wishes for the future to PIP, by Mary Ann Sieghart, I am delighted that of debt in PIP’s underlying investee by senior executives for their sector my fellow directors and the Pantheon the Board has agreed that John Singer businesses and seeks assurance that knowledge, operational expertise, and management team. will succeed me as Chair. A Director since appropriate and manageable capital strategic guidance. |  | structures are in place. A large proportion | | PIP’s Strategic Report, set out on pages 2 | | --- | --- | --- | --- | | services professional with over 30 years’ | of PIP’s portfolio companies are “asset | PIP’s outperformance of the MSCI World | to 55, has been approved by the Board | | experience. He has been a consistently | light” and orientated towards growth | and FTSE All-Share indices since inception, | and should be read in its entirety by | | thoughtful and energetic contributor to | capital backed businesses, which carry | and over more recent timeframes, is a | shareholders. | | the Board and will provide experienced | little or no debt. Small and mid-market | testament to the value of having exposure | |   leadership for PIP during the years ahead.   Chair of PIP’s portfolio, typically have lower levels companies led by some of the best private of debt than those at the larger end of equity managers in the world. Through the 3 August 2022 Pantheon International Plc 21Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ## Key Performance Indicators Performance 5-year cumulative total shareholder return NAV per share growth Portfolio investment return Liquidity Net portfolio cash flow Undrawn coverage ratio 1 Adjusted for the 10 for 1 share split which was implemented on 1 November 2021. WHAT THIS IS Total shareholder return demonstrates the return to investors, after taking into account share price movements (capital growth) and, if applicable, any dividends paid during the period. The Board's strategy is to deliver returns for shareholders through the growth in NAV and generally not through the payment of dividends. HOW PIP HAS PERFORMED - PIP's ordinary shares had a closing price of 295.5p at the year end (31 May 2021: 272.0p). - Disappointingly, discount to NAV widened to 35% as at the year end (31 May 2021: 21%). LINK TO OUR STRATEGIC OBJECTIVES - Maximise shareholder returns through long-term capital growth. - Promote better market liquidity and narrow the discount by building demand for the Company's shares. EXAMPLES OF RELATED FACTORS THAT WE MONITOR - Rate of NAV growth relative to listed markets. - Trading volumes for the Company's shares. - Share price discount to NAV. 5-year cumulative total shareholder return ![img-3.jpeg](img-3.jpeg) Strategic Report Manager's Review Governance Financial Statements Other Information Panthesin International Plc Annual Report and Accounts 2022 | 22 ### Key Performance Indicators ### 5-year cumulative total WHAT THIS IS NAV per share growth during the year ### shareholder return  a shareholder’s holding in PIP. The provision of  consistent long-term NAV per share growth is 1  ### NAV per share growth 30% 31.0% NAV per share growth in any period is shown net of foreign exchange movements and all costs associated with running the Company. 25% ### Portfolio investment HOW PIP HAS PERFORMED ### return – A record year of NAV growth with NAV per share 20% increasing by 106.8p to 451.6p during the year | | 2 | | 19.6% | | --- | --- | --- | --- | | (31 May 2021: 344.8p) | . | | | | LINK TO OUR STRATEGIC OBJECTIVES | | 15% | | –  managers globally to maximise long-term ###  35% capital growth. 10%  – Containing costs and risks by constructing a  5% ### Undrawn coverage ratio EXAMPLES OF RELATED FACTORS THAT WE MONITOR 4.0% – Valuations provided by private equity managers. 0% – Fluctuations in currency exchange rates. 12M to 12M to 12M to – Ongoing charges relative to NAV growth 31 May 2020 31 May 2021 31 May 2022 and listed private equity peer group. –  –    2 Adjusted for the 10 for 1 share split which took effect from 1 November 2021. The NAV per share is stated in pre-share split terms. Pantheon International Plc 23Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Key Performance Indicators ### 5-year cumulative total WHAT THIS IS Portfolio investment return ### shareholder return Portfolio investment return measures the total movement in the valuation of the underlying  funds and companies comprising PIP’s portfolio,  ### NAV per share growth 35% 36.0%   30% HOW PIP HAS PERFORMED – Strong performance in the underlying portfolio. ### Portfolio investment 25% 26.2% 1 ### return –  growth in its underlying portfolio and from the favourable exit environment. 20% – Weighted average revenue and EBITDA growth  | | | | 2 | 15% | | --- | --- | --- | --- | --- | | | | buyout companies |  | | | |  | respectively for companies that constitute the | | | | 40% | | MSCI World Index. | | | 10%  LINK TO OUR STRATEGIC OBJECTIVES – Maximise shareholder returns through 5% ### Undrawn coverage ratio long-term capital growth. 3.9% EXAMPLES OF RELATED FACTORS THAT WE MONITOR 0% – Performance relative to listed markets 12M to 12M to 12M to and private equity peer group. 31 May 2020 31 May 2021 31 May 2022 – Valuations provided by private equity managers.   2 See page 195 of the Alternative Performance Measures section for sample calculations and disclosures. Pantheon International Plc 24Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Key Performance Indicators ### 5-year cumulative total WHAT THIS IS  ### shareholder return     existing investment commitments. £232m ### NAV per share growth  of primaries, secondaries and co-investments £199m   ### Portfolio investment  ### return HOW PIP HAS PERFORMED PIP’s portfolio generated a record £419m (31 May 2021: £319m) of distributions versus £187m (31 May 2021: £120m) of calls. £110m In addition, the Company made new commitments 1 | | |  | of £496m (31 May 2021: £240m) during the year, | | --- | --- | --- | --- | | £250m | | | £160m (31 May 2021: £76m) of which was drawn | | |  | | at the time of purchase. | £50m At 31 May 2022, PIP’s portfolio had a weighted 2 average age of 4.9 years (31 May 2021: 5.2 years). ### Undrawn coverage ratio £200m LINK TO OUR STRATEGIC OBJECTIVES £0m – Maximise long-term capital growth through ongoing portfolio renewal while controlling 12M to 12M to 12M to  31 May 2020 31 May 2021 31 May 2022 £150m EXAMPLES OF RELATED FACTORS THAT WE MONITOR – Relationship between outstanding commitments and NAV. £100m – Portfolio maturity and distribution rates by vintage. – Commitment rate to new investment opportunities.   2 Excludes the portion of the reference portfolio attributable to the ALN. Pantheon International Plc 25Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Key Performance Indicators ### 5-year cumulative total WHAT THIS IS  ### shareholder return The undrawn coverage ratio is the ratio of available   undrawn commitments. The undrawn coverage ratio is an indicator of the Company’s ability to meet ### NAV per share growth outstanding commitments, even in the event of a 122% market downturn.  107% 100% continue to make new undrawn commitments 100% ### Portfolio investment   ### return 80% HOW PIP HAS PERFORMED – The current level of commitments is consistent with PIP’s conservative approach to balance 60% sheet management. ###  –  140% 40% expects undrawn commitments to be funded | |  | |  | | | --- | --- | --- | --- | --- | | 120% | | | LINK TO OUR STRATEGIC OBJECTIVES | 20% | | | | Undrawn coverage ratio | – Flexibility in portfolio construction, allowing the | | Company to select a mix of primary, secondary and co-investments, and vary investment pace, 0%  31 May 2020 31 May 202231 May 2021 EXAMPLES OF RELATED FACTORS THAT WE MONITOR – Relative weighting of primary, secondary  – Level of undrawn commitments relative to gross assets. – Trend in distribution rates. – Ability to access debt markets on favourable terms. Pantheon International Plc 26Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Our Strategy In addition, the Board reviews individual ### The Board regularly reviews investments that exceed exposure limits, ## Building a resilient PIP’s overall investment which are set at appropriate levels to  ### strategy and it has formed the Manager may make recommendations ### part of Board discussions to the Board and seek approval for certain ## portfolio that can deliver investments that fall outside of any ### throughout the year. limits expressed in the agreed strategic approach, but which Pantheon believes to ## long-term outperformance Through the ongoing dialogue between be a good investment opportunity for PIP. the Board and the Manager, Pantheon, the The Board maintains its independence at Manager reports to the Board on progress all times and robustly challenges such and highlights any obstacles or changes in recommendations to ensure that they market conditions which may impact the are in the best interests of shareholders. Company’s ability to achieve its strategic The Manager also reports to the Board on goals. In cases where this may occur, the  Manager will propose solutions for which it activities, considering new initiatives that will seek the support of the Board. Equally,    propose amendments to the strategy  Company. As part of this, on 1 November as it deems necessary. 2021, each of PIP’s existing shares was  split into 10 shares. The aim was to make PIP’s shares more accessible to a range of investors and to improve the marketability of PIP’s shares.    Global outlook, with a focus on high-growth and niche areas Pantheon International Plc 27Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Our Strategy  Primaries, secondaries and co-investments all have attractive characteristics, as 1 2  Investment type highlighted in the Business Model on pages 31 to 36. PIP’s transparent and ###  direct investment approach gives it the  ### potential to boost performance market conditions and to maximise control   As the weighting towards co-investments has been increased over time, the three different investment types have intentionally | taken on more equal weightings. These | 2021 and later  | | Primary  | | --- | --- | --- | --- | | weightings do not represent hard caps; | 2020  | | Co-investments  | | however, the Board and the Manager believe | 2019  | | Secondary  | |  | 2018  | | | | the cash generated by the more mature | 2017  | | | | assets in PIP’s portfolio while rejuvenating | 2016  | | | | the portfolio with the younger vintages | |  | | 2015  offered by primaries and co-investments. create a clearer link between the strongest 2014  In addition, we have been steering PIP’s performing companies in the portfolio and 2011-2013  secondary investment strategy towards the potential to boost NAV growth in the 2010 and earlier  | single-asset secondaries which form a | future. Also, Pantheon can remain highly | | --- | --- | | fast-growing part of the secondary market | selective and disciplined when assessing | | and are attractive for several reasons as |  | | highlighted on page 34. | the risk of PIP being excluded from exciting | individual assets should be increased while opportunities due to investment constraints.  With an increased weighting towards  co-investments and single-asset secondaries, During the year, while maintaining its and sector. | | we expect the number of underlying | | disciplined approach, the Board and the | | --- | --- | --- | --- | | 1 Maturity chart is based on underlying fund valuations | | |  | | | managers and portfolio companies to | The Board believes that there are several | |  which the Company is exposed to continue opportunity to increase the Company’s Excludes the portion of the reference portfolio  attributable to the ALN. to reduce over time. As a result, the investment pacing to take advantage of risk is effectively managed through 2 Fund investment type and maturity charts are based potential for the Company’s overall NAV the exciting deals emanating from its   to be impacted by the performance of private equity managers. of PIP’s overall portfolio value. The charts exclude the transparency of PIP’s underlying portfolio, portion of the reference portfolio attributable to the Asset Linked Note. Pantheon International Plc 28Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Our Strategy   While late stage venture opportunities which ranges across venture, growth,  1  small/mid buyout and large/mega buyout    ### Focus on mid-market special situations. While the Company’s PIP’s portfolio. Therefore, any investment strategy is to maintain a healthy mix of all activity by PIP in early stage venture ###  stages, Pantheon favours the growth and  buyout segments, with a particular focus venture managers, mainly through primary on the mid-market. The mid-market offers fund investments, who are able to identify distinct characteristics, when compared innovative opportunities with the potential   While special situations include assets – More attractively priced assets which with unique characteristics which can  Small/mid buyout   than the broader market average; Large/mega buyout  Board’s intention that special situations Growth  – Greater visibility of the value drivers and investments will only be a small minority 2 Special situations  the levers to pull to improve operational  Venture   organically and through buy-and-build strategies; and – More routes to exit including strategic acquisitions, sales to other private equity managers or initial public offerings (“IPOs”). In PIP’s case, it should be noted that the majority of exits has consistently been to strategic buyers and other private equity managers. 1 Fund stage chart is based upon underlying fund  portfolio value. The chart excludes the portion of the reference portfolio attributable to the Asset Linked Note. 2 Special situations investments can include distressed debt, mezzanine, energy/utilities and turnarounds. Pantheon International Plc 29Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Our Strategy   The Board is committed to offering The Board believes that its oversight investors a global portfolio with investments of the Manager’s activities, while at the 1  in North America, Europe, Asia and Emerging  Markets. It takes an active approach that it needs to make the appropriate ### Global outlook, with a focus on towards the weightings of those geographies investment decisions on the Company’s in response to market conditions but behalf, ensures that PIP is able to deliver ### high-growth and niche areas supports the majority of the Company’s on its strategic objectives for shareholders capital being invested in the USA and over the long term. Europe where the private equity markets Culture and Purpose are well established. It is a requirement for all companies The Board relies on Pantheon’s investment to set out their culture and purpose. teams around the world that are on the Information technology   ground locally, to take advantage of Healthcare  relatively simple: it is to deliver our  Consumer  investment strategy led by a Board that to opportunities through their extensive Financials  promotes strong governance and a networks of relationships. long-term investment approach that Industrials  actively considers the interests of Communication services  It is Pantheon’s objective to identify managers all stakeholders. Energy  globally that are able to take a thematic Update charts approach and focus on high-growth sectors, Materials  The Directors agree that establishing and  Others  maintaining a healthy corporate culture by the public markets. In addition, Pantheon among the Board and in its interaction 2  has a deliberate strategy of targeting with the Manager, shareholders and other sectors experiencing dislocation, as well stakeholders will support the delivery of its as niches where underlying growth is purpose, values and strategy. The Board less correlated to GDP growth. Recent seeks to promote a culture of openness examples of this have been within the and integrity through ongoing dialogue and Information Technology and Healthcare engagement with its service providers, sectors. For more information on the principally the Manager. 1 The company sector chart is based upon underlying  company valuations as at 31 March 2022, adjusted for see pages 75 to 77. calls and distributions to 31 May 2022. These account   3 USA  Asia and EM  2 Fund region is based upon underlying fund valuations  Europe  Global  The chart excludes the portion of the reference portfolio attributable to the Asset Linked Note. 3 EM is Emerging Markets. Pantheon International Plc 30Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Our Business Model  ## We aim to deliver Investment opportunities We invest in many of the best Cash generated from the in funds and companies private equity managers who sale of those companies ## consistent returns are originated via are able to identify and create is returned to PIP and Pantheon’s extensive and value in their businesses. redeployed into new well-established platform. investment opportunities. ## over the long term | What we do | Why we do it | How we do it | | --- | --- | --- | | PIP invests in private equity funds and | Through Pantheon, we have an opportunity | PIP’s Manager, Pantheon, has a | | co-invests (alongside selected private equity | to invest with many of the best private equity |  | | managers) directly into private companies | managers globally based on the trust and | strategic pillars of investment: primary, | | worldwide. | experience built up over the almost 40 years | secondary and co-investments, with each | | | during which Pantheon has been making | offering their own merits. | – An investment in PIP offers shareholders investments. exposure to a growing market worth over We believe that by combining the 1 | US$5.3tn | globally where the best private | – It is our aim to bring the strong credentials | three ways of accessing private equity | | --- | --- | --- | --- | | equity managers might otherwise be | | of private equity and its track record of | investments, we are able to: | | inaccessible to shareholders. | | outperforming public markets to a wider | | – Build and maintain a well-balanced set of investors. We aim to deliver attractive and consistent  returns to shareholders over the long term, It is our mission to generate sustainably high and manage with the aim of maximising and at relatively low risk. The Board remains investment returns through an actively  committed to its policy of maximising managed, institutional grade portfolio of –  capital growth and therefore, as in previous funds and companies built by investing with so that our portfolio remains naturally years, is not proposing the payment of the best managers globally. cash-generative on a sustainable basis; a dividend. and – Ensure that the vehicle remains as  shareholders by reducing any potential drag on returns. 1 Source: Preqin Global Private Equity Report 2022. Pantheon International Plc 31Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Our Business Model ### Our investment strategies: – Captures exposure to top-tier, well-recognised managers as well ### We invest in a new private as to smaller niche funds that are generally hard to access. ### equity fund when it is – Targets leading managers predominantly in the USA and Europe, ### Primary ### established. with a focus on funds which are unlikely to become available in the secondary market. ### Limited Partner Secondary INVESTMENT PERIOD HARVEST PERIOD ### Manager-led Secondary NET CASH FLOW ### Co-investment FUND 10 2 5 83 6 94 7 10 11 12 YEARS Pantheon International Plc 32Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts 0 ### Our Business Model ### Our investment strategies: – Targets favoured funds and companies at a stage when the ### We purchase the interests of underlying assets’ performance is visible and the funds are ### an investor in a fund or funds realising investments, returning cash to PIP more quickly. ### Primary ### typically late into, or after, the – One of the advantages of investing in secondaries is that earlier fees will have been borne by the seller so total expenses are lower. ### investment period. ### Limited Partner Secondary INVESTMENT PERIOD HARVEST PERIOD ### Manager-led Secondary NET CASH FLOW ### Co-investment FUND 10 2 5 83 6 94 7 10 11 12 YEARS Pantheon International Plc 33Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts 0 ### Our Business Model ### Our investment strategies: – We partner with high-quality private equity managers to acquire, ### We invest in a company directly, as single transactions, their most attractive portfolio companies ### alongside a private equity via a continuation fund. ### Primary ### manager, that the manager has – Allows the private equity manager to hold onto a prized asset, which they believe has potential for further growth, when the fund ### already owned for a period of in which it is held comes to the end of its life. ### time and therefore knows well. ### Limited Partner Secondary INVESTMENT PERIOD HARVEST PERIOD ### Manager-led Secondary NET CASH FLOW ### Co-investment FUND 10 2 5 83 6 94 7 10 11 12 YEARS Pantheon International Plc 34Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts 0 ### Our Business Model ### Our investment strategies: – Direct investment in individual companies, which have attractive ### We invest in a company growth characteristics and have effectively passed through a ### directly, alongside a private  ### Primary ### equity manager. – This boosts the performance potential because there are typically very low or no fees, making it a cost-effective way of capitalising on the high value added by PIP’s selected managers. – Co-investments are through invitation only and are therefore not ### Limited Partner Secondary accessible to most investors. INVESTMENT PERIOD HARVEST PERIOD ### Manager-led Secondary NET CASH FLOW ### Co-investment COMPANY 10 2 5 83 6 94 7 10 11 12 YEARS Pantheon International Plc 35Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts 0 ### Our Business Model ## What sets us apart | Track record | Broad and deep relationships | Independence | Culture & Transparency | | --- | --- | --- | --- | | For 35 years, PIP has been able to adapt | With investments in North America, | PIP has the opportunity to participate in | Pantheon has a strong culture of | | quickly and effectively to changing market | Europe, Asia and Emerging Markets, | all the private equity investments sourced | collaborative and inclusive teamwork, | |  | PIP provides a carefully constructed, | by Pantheon. The majority of the | transparency and diversity, as well as a | | approach means that PIP is well placed | broad-based portfolio for investors. | Company’s investments are made directly | long history of investing its clients’ capital | | to continue to deliver on its strategic | The presence of Pantheon’s team of | in private equity funds and companies | responsibly. PIP is supported strongly | 3 objectives. PIP’s NAV has outperformed 417 people, including 121 investment rather than via Pantheon’s collective by a global workforce of 417 people and a 1 | its public market benchmark indices since | professionals |  |  | large and experienced team of investment | | --- | --- | --- | --- | --- | | the Company’s inception in 1987. | world means that they are on the ground | | to PIP and its shareholders, including: | professionals, many of whom have been | | | locally, working with their extensive | | | at Pantheon for over 20 years. In keeping | – Control of investment strategy, overseen  with its collaborative culture, Pantheon by the Board; equity managers and taking advantage avoids investments in private equity  –  managers with ‘star’ individuals giving access to opportunities. These able to accept or decline investments rise to a higher degree of key person risk. relationships enable Pantheon to source offered to it by Pantheon according PIP is committed to being transparent   with its investors and publishes a monthly in those regions. In addition, through its | | 2 | –  | NAV and newsletter to ensure the market | | --- | --- | --- | --- | | participation on over 560 | advisory boards | | | | | | commitments as appropriate and | is kept updated on developments in the | globally, Pantheon actively engages with in line with any adjustments to its portfolio.  investment strategy; and monitoring issues on a continuous basis. – Lower cost than investing through intermediate vehicles, due to the elimination of management fees and related expenses. 1 As at 30 June 2022. 2 As at 31 March 2022. 3 As at 30 June 2022. Pantheon International Plc 36Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Investment Policy The Company may invest in any type of In addition, the Company adopts the The Company may enter into derivatives ### Our investment policy is to  following limitations for the purpose of  maximise capital growth and non-equity shares, debt securities, diversifying investment risk: portfolio management and hedging subscription and conversion rights and (for example, hedging interest rate, ###  – No holding in a company will represent options in relation to such shares and currency or market exposures).  ###  securities, and interests in partnerships Company’s investments at the time Surplus cash of the Company may be and limited partnerships and other   The Company’s policy is to make unquoted forms of collective investment schemes. the requirement for approval as an bank deposits or other similar securities. investments. It does so by subscribing to Investments in funds and companies investment trust which applied to investments in new private equity funds may be made either directly or indirectly, The Company may borrow to make the Company in relation to its (“Primary Investment”), buying secondary through one or more holding, special investments and typically uses its accounting periods ended on and interests in existing private equity funds purpose or investment vehicles in which borrowing facilities to manage its cash before 30 June 2012). (“Secondary Investment”), and acquiring one or more co-investors may also have  direct holdings in unquoted companies an interest. – The aggregate of all the amounts make investments as and when suitable (“Co-investments”), usually either where invested by the Company in (including opportunities arise, and to meet calls in The Company employs a policy of a vendor is seeking to sell a combined commitments to or in respect of) funds relation to existing investments without over-commitment. This means that the portfolio of fund interests and direct managed by a single management  Company may commit more than its holdings or where there is a private equity group may not, in consequence of any for such purposes. Under the Company’s available uninvested assets to investments  such investment being made, form more Articles of Association, the Company’s in private equity funds on the basis that Manager, investing on substantially  borrowings may not at any time exceed such commitments can be met from  recently determined gross asset value   of the Company and the Company’s Typically, the Company does not expect The Company may, from time to time, hold Company and through the use of aggregate outstanding commitments in   borrowings and capital raisings respect of investments at the time such However, gearing may exceed this in the such investments being distributed to the where necessary. investment is made.  Company from its fund investments as the The Company’s policy is to adopt a global  result of an investment in an unquoted – The Company will invest no more than  company becoming quoted. In addition,  The Company may invest in private equity strategy is to mitigate investment risk the Company may invest in private equity closed-ended investment funds funds, unquoted companies or special  funds which are quoted. The Company will (including UK-listed investment trusts). purpose or investment holding vehicles portfolio by geography, sector and not otherwise normally invest in quoted  investment stage. Since the Company’s The Company may invest in funds and securities, although it reserves the right to ahead of the Company’s investment. The assets are invested globally on the basis, other vehicles established and managed or do so should this be deemed to be in the Company does not adopt restrictions on primarily, of the merits of individual advised by Pantheon or any Pantheon interests of the Company. the extent to which it is exposed to gearing investment opportunities, the Company   does not adopt maximum or minimum    industry sectors or the investment stage of  underlying investments.   Pantheon International Plc 37Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Responsible Investment and ESG ### The Directors of PIP have full oversight of ESG matters within ### PIP’s portfolio and are fully supportive of Pantheon’s approach ### to investing responsibly and championing diversity, as ### Pantheon describes below. ## PIP’s ethos of  are actively engaging with our private adoption of sound environment, social and equity managers on this topic. ## responsible investing governance (“ESG”) principles in the private Furthermore, many of our managers are equity sector in recent years, which has excited by the investment opportunities been driven by a number of factors. These arising as a result of the green transition have included increasing demand from and environmental priorities, with a investors as well as recognition among particular focus on themes such as private equity managers that integrating  ESG into the investment process is not only and the decarbonisation of industry. ### Pantheon takes its role as the right thing to do but can also enhance Governance is strong in private equity returns. Disclosure on ESG matters is also ###  and perhaps is one of the main reasons improving in private equity and the United for the industry’s success. Private equity Nations-backed Principles for Responsible ### clients’ capital seriously. managers typically invest in businesses Investment (“UNPRI”) now requires all alongside the existing management team signatories, which include a number of our in the company and work closely with ### Consideration of ESG factors private equity managers, to demonstrate them to grow the businesses over time. that they are taking measures to move their Company management, the private equity ### is integrated throughout the reporting in line with the recommendations manager and their investors all exit the of the Task Force on Climate-Related ###  business at the same time, meaning Financial Disclosures (“TCFD”). that there is a real alignment of interests. | Although private equity managers in | There are direct lines of communication | | --- | --- | | Europe continue to lead the way when | between the private equity managers and | | measuring the environmental impacts of | the company management team which | | their portfolio companies, there is growing | means that they are able to adopt a much | | interest in the USA and Asia & Emerging | more proactive approach and respond | | Markets and many private equity | quickly to issues that may arise. We saw | | managers have implemented global | many examples of this during the | | policies against which to measure and | COVID-19 pandemic when private equity | | manage their investments regardless of | managers were able to use their skills | | the region in which a business is based. | to help companies through the crisis. | Climate change affects us all and we Strategic Report Pantheon International Plc 38 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Responsible Investment and ESG As attention turns to the challenges faced by the global economy, the private equity   Investment team industry is well placed to make a positive | | | | | 1 | | 1 | | --- | --- | --- | --- | --- | --- | --- | | | | |  | |  | | | contribution to growth through the creation | Pantheon is committed to being an | policies in place for their own businesses | | | | | | and support of jobs. According to a recent | inclusive and diverse employer and we | and increasingly acknowledging its | | | | | | study, at the end of 2020 nearly 10 million | aim to create an open, creative and | importance for their portfolio companies. | | | | | | people were employed by private | welcoming culture that enables every | We will continue to advocate for this | | | | | | equity-backed companies in Europe, | single employee to feel valued and that | through our partnerships with charitable | | | | | 1 |  | . | their talents are being utilised. We have |  | | | | --- | --- | --- | --- | --- | --- | |  | | taken steps to ensure the recruitment | champion diversity across the | | | | were supported by private equity and | | process includes people of different | investment management industry, such | | | | | | | | Male  | Male  | | venture capital-backed companies, which | | backgrounds; and candidates are | as Diversity Project, 10,000 Black Interns, | | | | | | | | Female  | Female  | |  | | sourced from a wide demographic using | GAIN, Jopwell and the Institutional | | | Prefer not to say  2 GDP . In the USA, there are over 11 million various platforms and partnerships, while Limited Partners Association (ILPA) employees at private equity-backed a representative and balanced screening Diversity in Action initiative, as well as 3 companies and, in 2021, private equity process is used. We are delighted that through our sponsorship of Level 20, a 1  3 | invested over US$1tn in the US economy | . | our hard work has been recognised and |  | | --- | --- | --- | --- | | As private equity managers continue to | | rewarded with Pantheon being named | to inspire women to join and succeed in | | grow their portfolio companies, indications | | the Diversity and Inclusion Leader of | the private equity industry. | |  | | the Year (LP) at The Private Equity | | | This has a positive impact, not just on the | | Awards 2022. | | THE lives of those people employed by their PRI VATE Pantheon has incorporated a diversity EQUITY portfolio companies, but also on those AWARDS and inclusion section in its due diligence impacted through supply chains and the questionnaire for all its primary customers who value the products and White  investments and, while there is still services offered by them. Other  some way to go to achieve the diversity Prefer not to say  In recognition of the opportunity to make and inclusion of women and different investments that have the potential not ethnicities in the wider private equity only to produce market-leading investment sector, we have been encouraged to 1 The response rate for our voluntary survey in December 2021– returns, but also to make a positive impact note that many of our private equity  on communities across the globe, PIP managers are putting recruitment prior annual survey. committed £17.8m to the Apax Global  1 Source: Invest Europe, Private Equity at Work, April 2022. 2 Source: BVCA Digest, June 2022. 3 Source: American Investment Council: https://www.investmentcouncil.org. Pantheon International Plc 39Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts  ### Responsible Investment and ESG  – Regularly organising ESG seminars at  industry events and speaking regularly At Pantheon, we believe that the consideration on ESG topics with media outlets and of ESG issues should not be an afterthought. at industry conferences. | When investing on behalf of PIP, Pantheon | | 1 | 4 | | --- | --- | --- | --- | | targets robust and resilient businesses that | In addition, Pantheon sits on over 560 | | | | | | We will incorporate ESG | We will promote acceptance | 1 will stand the test of time and maintain advisory boards globally , enabling issues into investment and implementation of the broad stakeholder support. Pantheon to promote education, learning analysis and decision-making Principles within the and best practices among its private equity We take our role as a responsible steward processes. investment industry. managers. This engagement extends from of our clients’ capital seriously and this our initial commitment to an investment, has been our central ethos for many years. all the way through to divestiture. 2 5  | investors to become a signatory to the | Pantheon has an established in-house | We will be active owners | We will work together to | | --- | --- | --- | --- | | UNPRI in 2007 and we have consistently | ESG committee – comprising senior | and incorporate ESG issues | enhance our effectiveness | | received high scores in their annual | individuals from its investment, risk, | into our ownership policies | in implementing the | | assessment since then. Pantheon also | legal and investor relations teams. Our | and practices. | Principles. | | advocates for ESG through its support for | capabilities and outreach in this area will be | | | | a number of trade associations and ESG | further strengthened by the appointment of | | | | initiatives, which include: | a Global Head of ESG at Partner level | 3 | 6 | whose role will be to continue to develop We will seek appropriate We will each report on our – Regularly contributing to guideline Pantheon’s ESG strategy and range of disclosure on ESG issues activities and progress consultations with regulatory bodies initiatives. by the entities in which towards implementing around the world, to continue to contribute we invest. the Principles. to evolving industry best practice;   – Setting up the ESG committee within the Hong Kong Private Equity and Venture Consideration of ESG factors is integrated Capital Association, Asia’s largest throughout the investment process for PIP. industry association by membership, At the pre-investment due diligence stage,  in 2015 and leading it since then; we conduct an ESG risk assessment on the private equity manager or on the company The UK’s Modern Slavery Act 2015 requires already aligned with a zero tolerance approach –  itself in the case of a co-investment or Pantheon to report annually on the steps taken  award in Asia, the ESG Award of single-asset secondary deal.  the policy and the Modern Slavery Statement Excellence, which has been running | | | not taking place anywhere within the business | can be found on Pantheon’s website | | --- | --- | --- | --- | | since 2017 and is awarded every | The risk assessment assesses a variety of | | | | | | or supply chains. Pantheon’s ESG policy is | (www.pantheon.com). | | two years to private equity-backed | factors such as if and how the private equity | | | | companies in recognition of outstanding | manager integrates ESG into their investment | | | | ESG-related initiatives and achievements; | process, their engagement with portfolio | | | | and | companies on ESG issues and their approach | | | to reporting any ESG risks to their investors. 1 As at 31 March 2022. Pantheon International Plc 40Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Responsible Investment and ESG This enables Pantheon to assign a rating to beyond the information provided during Supporting the shift to Net Zero the manager of high (good ESG integration the initial due diligence process which may and clear reporting), medium (there are areas be several years old. The survey provides for improvement, e.g. ESG is not formally information on the managers’ UNPRI The effects of climate change are Pantheon sits on the Net Zero working integrated into their investment process) status, their approach to mitigating climate being felt around the world and group that is looking to create a  risk and any changes to their ESG policies. many businesses are putting in credible framework for achieving integration). PIP will not invest in the It also seeks to capture positive ESG case place policies to reduce their carbon Net Zero in the sector. managers that provide a low rating in the studies as well as alert us to any negative emissions. Pantheon is actively  issues that Pantheon was not previously As one of the largest private markets developing its pathway to Net Zero year, PIP invested in 25 funds of which aware of through its routine monitoring investors in the world, and through its as well as engaging with its private Pantheon assessed the majority as  long-term relationships with some of equity managers to encourage being rated as high, with the remainder tracking trends over time and improving the most established private equity them to commit to Net Zero and set rated medium. engagement with PIP’s underlying managers globally, Pantheon is well science-based targets across their managers on ESG issues. positioned to take a leadership role portfolio companies. Pantheon works As we continue to evolve and improve in the industry on this topic. very closely with the Institutional our due diligence processes, we recently  Investors Group on Climate Change introduced key counterparty risk as part ESG continues to climb up the list of and welcomes their draft guidelines of our assessment of secondary and priorities for both investors and private for achieving Net Zero for private co-investment deals. A key counterparty equity managers and it is becoming widely   recognised that the implementation of chain, such as suppliers, vendors in the Furthermore, Pantheon is working good ESG practices and the generation of distribution chain or customers, who might closely with Initiative Climat healthy returns on investments are not present heightened ESG risks. We believe International, a leading group of mutually exclusive. We believe that those that this provides an additional safeguard private equity managers and private managers who do not incorporate ESG into against “collateral risk” in our investments. markets investors, and collaborating their due diligence process when selecting to support climate change initiatives. | RepRisk, a third-party data provider which | investments, and how they manage their | | | --- | --- | --- | | has been integrated in our investment | portfolio companies, may struggle to | | | processes since 2017, provides Pantheon | access capital in the future. Over the | | | with extensive coverage of ESG issues | coming years, we expect to see, and | | | within the portfolio companies that our | encourage, an increasing move towards | | | clients are invested in across our platform. | the standardisation of how ESG factors are | | | In order to improve further the quality and | monitored which in turn should lead to |  | | availability of data which we can use for | enhanced ESG reporting in the industry. | | ###  analysis, we initiated an annual survey of Pantheon has well-established processes our private equity managers during the ### managers to encourage them to commit to Net and practices to respond effectively to  the changing demands of its clients, such ###  | The purpose of the annual manager survey | as PIP and its Board, and will continue to | | | --- | --- | --- | | is to provide Pantheon with up-to-date | invest PIP’s capital in a responsible manner | portfolio companies. | | information on our private equity managers | as it has done for the past 35 years. | | Pantheon International Plc 41Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### ESG case study | Commitment | £9.1m | Stage | Small/Mid Buyout | | --- | --- | --- | --- | | Manager | Ergon Capital Partners (“Ergon”) |  | Industrials | | Type | Co-investment |  | Europe | ## Upholding ethical ## standards Satlink is a global leader in the development of technological    Pantheon International Plc 42Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### ESG case study Investment rationale   – Satlink offers several different products, Satlink’s products support sustainable services and technological solutions  to its customers. The company has marine ecosystems: Satellite communications an international presence and holds – The company’s smart buoy products a market-leading position in a highly  concentrated sector. Satellite communicates   – The private equity manager, Ergon,  centre and vessel with regards Satlink’s core business as a – Satlink’s technology helps preserve Satlink software strong growth platform as it operates marine ecosystems by ensuring that in a market with high barriers to entry, only species with healthy stocks are   customer churn. Fisheries Management Centre species is minimised. – Further sources of growth include an Vessel –  increased service offering, the possibility  of enhancing its subscription model in their carbon footprint. and developing a more extensive oceanography product range. Satlink is an important asset to the global ocean protection movement; it has strong Satlink smart buoy Our relationship links to non-governmental organisations Pantheon is a primary investor with Ergon such as charities that focus on the and an Advisory Board member. Ergon had  been tracking Satlink over several years  Floating platform | and was ultimately attracted to it as the | awareness of ocean sustainability. | | --- | --- | | theme of technological disruption in a | The company won a United Nations Global | | traditional market is consistent with | Compact award in February 2022 for its | Satlink smart buoy monitors several of their previous investments.   industry and the preservation of marine life. As a result of the relationship between communicates with satellite Pantheon and Ergon, PIP was offered the opportunity to co-invest alongside Ergon in this exciting company. Pantheon International Plc 43Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Financing Our Undrawn Commitments 1 ### Prudent balance sheet  ### management supports PIP’s undrawn commitments were £755m as at 31 May 2022 (31 May 2021: £528m). ### PIP’s long-term 2 £2,500m At 31 May 2022, PIP had net available cash ### investment strategy. balances of £227m (31 May 2021: £198m). ## 3.7x In addition to these cash balances, PIP also | | | £2,000m |  | | --- | --- | --- | --- | | We manage PIP to ensure that it has | has access to a wholly undrawn £300m | | | |  | multi-currency revolving credit facility | | | | commitments, which represent capital | agreement (“loan facility”) that expires | £1,500m | | | committed to funds but yet to be drawn | in May 2024. Using exchange rates at | | | | by the private equity managers, as well | 31 May 2022, the loan facility amounted | | | £1,000m as to take advantage of new investment to a sterling equivalent of £301m opportunities. We monitor and closely (31 May 2021: £277m). ## 100%  £500m At 31 May 2022, the Company had £528m undrawn coverage ratio commitments and future calls. A critical  part of this exercise is ensuring that the which, along with the value of the private £0m undrawn commitments do not become equity portfolio, provides comfortable excessive relative to PIP’s private equity Porfolio and available financing Undrawn commitments cover of 3.7 times (31 May 2021: 4.1 times)  relative to its undrawn commitments. We achieve this by managing PIP’s 2 Portfolio value Net available cash and loan Undrawn commitments investment pacing as well as constructing Another important measure is the undrawn its portfolio so that it has the right balance coverage ratio, which is the ratio of of exposure to primaries, secondaries  and co-investments. | | equity assets to undrawn commitments. | On 2 August 2022, PIP announced that | certain assets of the Company. The new | | --- | --- | --- | --- | | | The undrawn coverage ratio is a key |  | Loan Facility will expire in July 2027 with an | | | indicator of the Company’s ability to meet | multi-tranche, multi-currency revolving | ongoing option to extend, by agreement, | | | outstanding commitments, even in the | credit facility agreement (the “Loan | the maturity date by another year at a time. | | £3,000m |  | | | | | | Facility”) arranged by Credit Suisse, | The new facility has the effect of increasing | | |  | AG London Branch, Lloyds Bank Corporate |  | | | | Markets plc and State Street Bank | at 31 May 2022 to a pro forma level of | | | | International GmbH. The Loan Facility, |  | | | | which replaced the £300m loan facility | Facility will be instrumental in supporting | | | | agreement due to expire in May 2024, | the Company’s growth ambitions while | | | | is comprised of facilities amounting to | maintaining a resilient balance sheet. | $512.9m and €89.2m and is secured by . 1 Includes undrawn commitments attributable to the reference portfolio underlying the ALN.   portion payable under the Asset Linked Note, which amounted to £2.8m as at 31 May 2022. Pantheon International Plc 44Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Financing Our Undrawn Commitments | | 1 | | 1 | | 1 | | --- | --- | --- | --- | --- | --- | |  | |  | |  | | | The largest share of undrawn commitments is | |  | | The rise in more recent vintages is a result of | | | represented by investments in the USA and | | by stage with an emphasis on small and | | PIP’s increased allocation to direct investments | | | Europe, which highlights the Company’s | | mid-market buyout managers, many of whom | |  | | | investment focus on more developed private | | have experience of successfully investing | | undrawn commitments are in funds with vintage | | | equity markets. PIP’s undrawn loan facility is | | across multiple economic cycles. | | years which are 2016 or older. Generally, when a | | | denominated in US dollars and euros to match the | | | | fund is past its investment period, which is | | | predominant currencies of its undrawn | | | |  | | | commitments. | | | | make any new investments and only draws | | capital to fund follow-on investments into existing portfolio companies, or to pay expenses. As a result, the rate of capital calls by these funds  Region Stage . Vintage | USA  | Small/mid buyout  | 2022  | 2016  | | --- | --- | --- | --- | | Europe  | Large/mega buyout  | 2021  | 2015  | | Global  | Growth  | 2020  | 2014  | | Asia and EM  | Venture  | 2019  | 2011–2013  | | | Special situations  | 2018  | 2010 and earlier  | 2017  1 Includes undrawn commitments attributable to the reference portfolio underlying the Asset Linked Note. Pantheon International Plc 45Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Risk Management and Principal Risks The Company is exposed to a variety of risks and uncertainties. The Board, through delegation to the Audit Committee, has undertaken a robust assessment and review of the principal risks facing PIP,  liquidity. A summary of the risk management and internal control processes can be found in the Statement on Corporate Governance on pages 140 to 146. Investment risk   Risk management  – Impact of general economic conditions on underlying – Pantheon’s investment process incorporates an  ### Market factors such as | | fund and company valuations, exit opportunities and |  | to portfolio construction. | | --- | --- | --- | --- | |  | the availability of credit. | | | | | | – Investing alongside private equity managers with |  | | equity market performance | | experience of navigating economic cycles, while | 31 May 2022. |  ### can affect the value of  vintage and sector, helps to mitigate the effect volatility, private equity market valuations  ### investments.  performance. PIP invests in private assets and only  gains exposure to public markets by companies being taken public through an initial public offering. – Investment losses and reputational damage arising – PIP has a mature portfolio that is naturally cash – PIP has access to a £300m loan facility that expires ###  from the inability to meet capital call obligations. generative. in May 2024. Together with PIP’s net available cash ### to meet outstanding  – In the event that cash balances and cash distributions at 31 May 2022 stood at £528m. Total available ### commitments to private   ability to draw funds from a credit facility.  ### equity funds.  – Pantheon manages the Company so that undrawn  – The Company renewed its multi-currency revolving  credit facility after the year end. The new £500m secured facility, which is due to expire in July 2027, – The Board conducts a comprehensive review of the remains completely undrawn at the time of writing.  different scenarios on a regular basis.  – Pantheon has put in place a dedicated investment – During the year, PIP has invested within strategic limits ### Lack of suitable investment company exposures that are materially different from management process designed to achieve the for vintage year, geography and stage allocations, opportunities to meet  intended investment strategy agreed with the Board. as well as within concentration limits for individual managers, funds and companies. ###    ### objectives. investment processes. Pantheon International Plc 46Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Risk Management and Principal Risks   Risk management  – Potential decline in realisation activity which may   ### Private equity investments affect portfolio performance. secondary investments which typically have shorter  ### are long term in nature and exit horizons, with co-investments and primary horizons. commitments. ###  ### they can be realised. – Liquidity of underlying assets may have an adverse – As part of its investment process, Pantheon assesses – Robust realisation activity during the year, with a ### Investments in unquoted   the approach of its managers to company illiquidity  ### companies carry a higher as well as projected exit outcomes.  ###  ### relative to investments in ### quoted securities. – Potential impact on performance and liquidity, – PIP’s Articles of Association and investment policy  ### Gearing, whether at the  impose limits on the amount of gearing that the conditions were reviewed with the Board. Downside ### Company, fund investment Company can take on. scenario modelling indicates that the Company has  ### or portfolio company – The principal covenant of the loan facility ensures commitments, even in an environment characterised that the Company is limited to a maximum gearing by large NAV declines and a material reduction ### level, could cause the  in distribution activity. value (excluding the ALN). ###  – There was no gearing at the Company level as at – The Board conducts regular reviews of the balance ### and losses in the asset   value of the Company.  – Debt multiples in PIP’s buyout portfolio remain at  reasonable levels as at year end.  – Since the period end, the Company has announced liquidity sourcing in a distressed environment. that it has agreed a new revolving credit facility, – As part of its investment process, the Manager totalling £500m which is due to expire in July 2027. undertakes a detailed assessment of the impact – The principal covenants that apply to PIP’s credit of debt at the underlying fund level and underlying facility ensure that the Company is subject to  maximum loan to value and liquidity ratios. investment. Pantheon International Plc 47Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Risk Management and Principal Risks Investment risk   Risk management  – Unhedged foreign exchange rate movements could – The Manager monitors the Company’s underlying – Foreign exchange had a positive impact on ### Non-sterling investments  foreign currency exposure. performance during the year. ### expose the Company – As part of its investment process, the Manager ###  takes currency denominations into account when  ### exchange rates. investment. – The multi-currency credit facility is a natural hedge  commitments.  – The valuation of investments is based on periodically – No material misstatements concerning the valuations ### Reliance on the accuracy reporting. audited valuations that are provided by the underlying provided by GPs and the existence of investments ### of information provided private equity managers. during the year. ### by GPs when valuing – Pantheon carries out a formal valuation process  ### investments.  potential adjustments required to ensure reasonable    – Counterparty defaults can have unintended – PIP invests in high-quality funds alongside – During the year, funds in which PIP is invested did not ### Possibility that another consequences on the remaining investors’ institutional private equity investors. suffer from any limited partner defaulting events. ### investor in a fund is unable obligations and investment exposure. – A considerable proportion of PIP’s investments are ### or unwilling to meet future in funded positions. ### capital calls. – Failure to understand tax risks when investing or – Pantheon’s investment process incorporates an – Taxes had a minimal effect on overall NAV ### Changes in the Company’s  assessment of tax.  ### tax status or in tax legislation – The Manager reviews the appropriateness of an ###  investment’s legal structure to minimise the potential tax impact on the Company. Pantheon International Plc 48Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### Risk Management and Principal Risks Non-investment risk   Risk management  – Business disruption should the services of Pantheon – The Board keeps the services of the Manager and – The Board has approved the continuing appointment ### PIP relies on the services of and other third-party suppliers cease to be available to third-party suppliers under continual review.  ### Pantheon as its Manager the Company. an assessment of their respective performance – The Management Agreement is subject to a notice during the year. ### and other third-party period of two years, giving the Board adequate time to make alternative arrangements in the event that the – Pantheon now operates a hybrid working model and is ### service providers. services of Pantheon cease to be available.  needs through this model.  – Pantheon has a comprehensive set of policies, – No material issues to report for the year. ### High dependency on systems, including from a potential cyber attack standards and procedures related to information – Pantheon’s systems, processes and technologies ### effective information  technology and cybersecurity. have been thoroughly tested and are fully operational. business-critical functions, regulatory censure, ### technology systems to – Ongoing investment and training to improve the legal liability and reputational damage.  ### support key business technology processes and systems. ### functions and the ### safeguarding of sensitive ### information. – Market and currency volatility may affect returns. – Pantheon continuously monitors geopolitical – Pantheon’s established Risk, Legal and Tax functions ### Global geopolitical risks developments and societal issues relevant to its have ensured compliance with local laws and – Geopolitical undercurrents may disrupt long-term ### (including the Russia–Ukraine business. regulations. investment and capital allocation decision-making. ### war) and the resulting – An assessment of geopolitical risk is embedded in Pantheon’s investment process. ### economic uncertainty may – PIP’s exposure to high risk countries is minimal. ### affect the Company. – PIP’s de minimis legacy exposure to Russian assets  Pantheon International Plc 49Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### s172(1) Statement In doing so, the Directors must take into for the Board, as well as the terms of Stakeholders ### The Directors’ overarching consideration the interests of the various reference of its Committees are reviewed ### duty is to act in good faith and The Board seeks to understand the stakeholders of the Company, the impact on an annual basis and further describe needs and priorities of the Company’s PIP has on the community and the Directors’ responsibilities and obligations, ### in a way that is the most likely stakeholders and these are taken into environment, take a long-term view on the and include any statutory and regulatory account during all its discussions and as ### to promote the success of consequences of the decisions they make, duties. The Audit Committee has part of its decision-making. During the | | as well as aiming to maintain a reputation | responsibility for the ongoing review of | | | --- | --- | --- | --- | | PIP, as set out in Section 172 | | | period under review, the Board has | | | for high standards of business conduct | PIP’s risk management systems and | | continued to discuss and monitor ### of the Companies Act 2006. and fair treatment between the members internal controls and, to the extent that they which parties should be considered as of the Company. are applicable, risks related to the matters stakeholders of the Company and has set out in Section 172 are included in the  again concluded that, as the Company Company’s risk register and are subject its investment strategy and helps to ensure is an externally managed investment to regular review and monitoring. that all decisions are made in a responsible company and does not have any and sustainable way. In accordance with  employees or customers, its key the requirements of the Companies stakeholders comprise its shareholders, The importance of stakeholder (Miscellaneous Reporting) Regulations the Investment Manager, General Partners, considerations, in particular in the context 2018, the Company explains how the portfolio companies and service providers. of decision-making, is taken into account Directors have discharged their duties The section below discusses why these at every Board meeting. All discussions under Section 172 below. stakeholders are considered of importance involve careful consideration of the to the Company, and the actions taken To ensure that the Directors are aware of longer-term consequences of any to ensure that their interests are taken and understand their duties, they are decisions and their implications for into account. | provided with pertinent information when | stakeholders. Further information on | | --- | --- | |  | the role of the Board in safeguarding | | and ongoing updates and training on | stakeholder interests and monitoring | | relevant matters. They also have continued | ongoing investment activity can be | | access to the advice and services of the | found on pages 22 to 30 of the | | Company Secretary and, when deemed | Strategic Report. | necessary, the Directors can seek independent professional advice. The Schedule of Matters Reserved Pantheon International Plc 50Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### s172(1) Statement   | Shareholders | The Board is committed to maintaining open | Exchange. In addition, a quarterly “PIP | –  In the event that | | --- | --- | --- | --- | | | channels of communication and to engage | News and Views” update is circulated by | shareholders wish to raise issues or | | Continued shareholder support and engagement is | with shareholders in a meaningful manner in | the Manager to institutional investors and | concerns with the Directors, they are | | critical to the business and the delivery of its long-term | order to gain an understanding of their views. | analysts which provides a round-up | welcome to do so at any time by writing | | strategy. Further details on what PIP offers to its | These include: | of news and views, and highlights key |  | | investors can be found on pages 2 to 15 of the | | points of interest relating to the Company. | members of the Board are also available | | Strategic Report. | –     The Company welcomes and | | | | | | Feedback and/or questions that the | to shareholders if they have concerns that | encourages attendance and participation Company receives from shareholders have not been addressed through the from shareholders at the AGM. help the Company to evolve its reporting, normal channels; and Shareholders have the opportunity to meet aiming to render the reports and updates the Directors and Investment Manager, – At almost transparent and understandable; Pantheon, and to address questions to every Board meeting, the Directors receive them directly. Pantheon attends the –  Unlike trading updates from the Company’s broker on AGM and gives a presentation on the companies, shareholder meetings the share trading activity and share price Company’s performance and the future often take the form of meeting with the performance, as well as an update from outlook. The Company values any Investment Manager rather than members Pantheon’s Head of Investor Relations & feedback and questions that it may receive of the Board. Shareholders are able to meet  from shareholders ahead of and during with Pantheon throughout the year and shareholder feedback. Any pertinent the AGM and will take action or make the Manager provides information on the feedback is taken into account when changes, as and when appropriate; Company. Feedback from all meetings Directors discuss the investment strategy. between the Investment Manager and The willingness of the shareholders to –  The Annual Report and shareholders is shared with the Board. maintain their holdings over the long term Half-Year results are made available on The Chair, the Senior Independent Director, is another way for the Board to gauge how PIP’s website (www.piplc.com) and the Chairman of the Audit Committee and the Company is meeting its objectives.  other members of the Board are available Annual Reports are available. These to meet with shareholders to understand reports provide shareholders with a clear their views on governance and the understanding of the Company’s business Company’s performance should they  wish to do so. With assistance from the position. This information is supplemented Manager, the Chair seeks meetings with by a monthly newsletter, which is available shareholders who might wish to meet on the website and the publication of which with him; is announced via the London Stock Pantheon International Plc 51Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### s172(1) Statement   The Manager Maintaining a close and constructive – Recognising that the interests of – The Directors’ willingness to use their working relationship with the Manager is shareholders and the Manager are, for the experience to support and challenge Holding the Company’s shares offers investors a liquid crucial as the Board and the Manager both most part, well aligned, adopting a tone the Manager in the sound long-term investment vehicle through which they can obtain aim to achieve consistent, long-term returns of constructive challenge, balanced development of its business and  in line with the Company’s investment with robust negotiation of the Manager’s resources, recognising that the long-term investment opportunities and Pantheon's relationships strategy. The Board is in regular contact terms of engagement if those interests health of the Manager’s business is in the with its private equity managers (General Partners with the Manager to receive updates on should not be fully aligned; interests of shareholders in the Company. or “GPs”). The Manager’s performance is critical for investment activity. Important components the Company to successfully deliver its investment – The regular review of underlying strategic in the collaboration with the Manager, strategy and meet its objective to provide shareholders and investment objectives; representative of the Company’s culture are: with attractive and consistent returns over the long – Drawing on Directors’ individual experience term. Further details of PIP’s investment approach can – Encouraging an open discussion with and knowledge to support and challenge be found on pages 31 to 36 of the Strategic Report. the Manager, allowing time and space the Manager in its monitoring of portfolio for original and innovative thinking; companies and engagement with its GPs; and | GPs/portfolio companies | The relationship with Pantheon is | The Board receives updates at each | pages 31 to 36 and in the Manager’s Review. | | --- | --- | --- | --- | | | fundamental to ensuring the Company | scheduled Board meeting from the Manager | | | PIP's investment strategy is focused on backing | meets its purpose. Day-to-day engagement |  | | | managers that create sustainable value in the | with GPs is undertaken by Pantheon. | valuation reports and detailed portfolio and | | | underlying portfolio companies. The Manager has | Details of how Pantheon carries out portfolio | returns analyses. Pantheon’s engagement | | | extensive private equity networks and relationships | management, as well as information on how | with GPs and due diligence of portfolio | | | with private equity managers globally, which gives the | GPs consistently transform companies to | companies through the investment process | | | Company increased access to the best investment | create long-term value, can be found in the | and its investment strategies can be found | | | opportunities. | Manager’s Review on pages 56 to 131. | in the Strategic Report on pages 2 to 15 and | | The Administrator, the Company The Board maintains regular contact with its The Board (through the Management of service. The Audit Committee reviews key external providers and receives regular Engagement Committee) formally assesses  Secretary, the Registrar, the reports from them, both through the Board their performance, fees and continuing control environments in place at each and committee meetings, as well as outside appointment annually to ensure that the key service provider. ### Depositary and the Broker of the regular meeting cycle. Their advice, as service providers continue to function at In order to function as an investment trust with a well as their needs and views, are routinely an acceptable level and are appropriately premium listing on the London Stock Exchange, taken into account. remunerated to deliver the expected level the Company relies on a diverse range of reputable advisers for support in meeting all relevant obligations. | The Environment and society | The Board receives regular updates on | Full details on the Manager’s ESG practices, | | --- | --- | --- | | | Pantheon’s ESG strategy and provides | including examples of interaction with GPs, | | The Board continues to increase emphasis on | feedback on their approach, which | can be found on pages 38 to 43. | | the importance of ESG factors in its investment | in turn can lead to changes in its | | | deliberations. The Board and the Manager are | investment approach. | | fully committed to managing the business and its investment strategy responsibly. Pantheon International Plc 52Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ### s172(1) Statement   The Company aims to demonstrate to its facility syndicate that it is a well-managed business, capable of consistently delivering long-term ### Revolving credit facility providers returns. Regular dialogue between the Manager and the syndicate is crucial to supporting the Company’s relationship with its lenders. Availability of funding is crucial to PIP’s ability to Further details of the Board’s principal decision to replace the facility during the year can be found on page 44. take advantage of investment opportunities as they arise as well as being able to meet future unfunded commitments. The Company regularly considers how it meets various regulatory and statutory obligations and how any governance decisions it makes can ### Regulators have an impact on its stakeholders, both in the shorter and in the longer term. The Board receives reports from the Manager and Auditor on their The Company can only operate as an investment trust respective regulatory compliance and any inspections or reviews that are commissioned by regulatory bodies. if it conducts its affairs in compliance with such status. Interaction with regulators such as the Financial Conduct Authority (FCA) and Financial Reporting Council (FRC), who have a legitimate interest in how the Company operates in the market and treats its shareholders, and industry bodies such as the Association of Investment Companies (AIC), remains an area of Board focus. Pantheon International Plc 53Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ## s172(1) Statement The mechanisms for engaging with the stakeholders are kept under review by the Directors and will be discussed on a regular basis at Board meetings to ensure that they remain effective. Examples of the Board's principal decisions during the year, how the Board fulfilled its duties under section 172, and the related engagement activities, are set out below: | Principal decision | Long-term impact | Stakeholder considerations and engagement | | --- | --- | --- | | Board succession planning | Effective succession planning, leading to the refreshment of the Board and its diversity is necessary for the long-term success of the Company. | The Nomination Committee is responsible for Board recruitment and conducts a continuous and proactive process of planning and assessment, taking into account the Company's strategic priorities and the main trends and factors affecting the long-term success and future viability of the Company. During the year, as part of ongoing succession planning, the Nomination Committee reviewed the balance of skills and diversity on the Board as well as the Diversity Policy, and following a search process recommended a candidate who was subsequently appointed to the Board. The search requirements included a preference for candidates with a strong background in private equity and governance, as well as ethnic and gender diversity. For further information see page 144. On 9 June 2022, the Board announced that its Chair, Sir Laurie Magnus CBE, would retire as a Director of the Company following the conclusion of the Company's Annual General Meeting (the 'AGM') in October 2022 and, it was proposed that subject to his re-election by shareholders at the AGM, John Singer would assume the role as Chair. Future succession planning will include a preference for an ethnically diverse candidate for at least one role on the Board. | | Marketing initiatives | Various marketing initiatives have been taken by the Board during the period to increase the attractiveness of PIP to new and existing investors and improve the liquidity of the stock. | Marketing initiatives undertaken include the appointment of a new PR agency, a refresh of PIP's website and an intensive programme of capital markets events which are planned for the Autumn. | | Enlarged credit facility with maturity extension | Following extensive discussions by the Board throughout the year, on 2 August 2022, PIP announced that it has agreed a new multi-currency revolving credit facility (the 'Loan Facility') arranged by Credit Suisse AG London Branch, Lloyds Bank Corporate Markets plc and State Street Bank International GmbH, and secured by certain assets of the Company. The Loan Facility replaces the £100 million facility agreement which was due to expire in May 2024, and increases the facility size by £200m to £500m. It also extends maturity to July 2027 with an ongoing option to extend the maturity date by 12 months annually. | Effective engagement by the Manager with tenders was key to agreeing the new facility. The Board considers that the enlarged and extended Loan Facility will be instrumental in supporting the Company's growth opportunities while maintaining a resilient balance sheet. Further information relating to PIP's revolving credit facility can be found on page 44. | Strategic Report Manager's Review Governance Financial Statements Other Information Parkheon International Plc Annual Report and Accounts 2022 | 54 ![img-4.jpeg](img-4.jpeg) ### Viability Statement The Company invests in a portfolio of   ### Pursuant to provision 31 of  to the supply chain and increases in the the event that distributions received from the UK Corporate Governance by geography, sector, stage, manager   and vintage; it does so via both fund   ### Code 2018, and the AIC Code | | investments and by co-investing directly | rises, the impact of climate change on |  | | --- | --- | --- | --- | | of Corporate Governance, | into companies alongside selected private | PIP’s portfolio as discussed in Note 1 of | least quarterly to ensure that the Company | | | equity managers. The Company invests |  |  | ### the Board has assessed the  of any mitigating actions and the outstanding commitments on existing viability of the Company market as this allows the Company to Company’s risk appetite, all of which were investments as well as being able to  considered as part of the various downside  ### over a three-year period that is naturally cash-generative in any liquidity modelling scenarios carried out, In reviewing the Company’s viability, the ### from 31 May 2022. It has particular year. after which the Directors came to the Board has considered the Company’s  ### chosen this period as it falls The Company seeks to maximise long-term position with reference to its investment impact on viability. capital growth by investing with top-tier trust structure, its business model, its ### within the Board’s strategic private equity managers that are focused As part of the assessment this also business objectives, the principal risks on generating outperformance against included a combined reverse stress test and uncertainties as detailed on pages 46 ### planning horizon. | the broader private equity market. As an | that analyses the factors that would have | to 49 of this report and its present and | | --- | --- | --- | | investment trust, the Company’s permanent | to simultaneously occur for the Company |  | | capital structure is well suited to investing | to be forced into a wind-down scenario | Board has also considered the Company’s | | in private equity, a long-term asset | where the Company’s business model | conservative approach to Balance Sheet | | class. The Company’s Manager has a | would no longer remain viable. These | management, which allows it to take | | long-standing culture that emphasises |  |  | | collaboration and accountability, facilitating | in the outstanding commitments called | opportunities, and the appropriateness | | open dialogue with underlying private | within a 12-month period, combined | of the Company’s current investment | | equity managers that help the Company to |  | objectives in the prevailing investment | | anticipate market conditions and maintain | valuations and distributions. Overall, | market and environment. | | a conservative approach to balance |  | | Since the period end, the Company has sheet management. The resilience of the improbable as to provide a low likely risk announced that it has agreed a new Company, positioning of the portfolio and of impact to the Company’s viability and multi-currency revolving credit facility to durability of the private equity market are medium-term resilience. replace the existing one that was due to detailed on pages 63 to 69. | | Commitments to new funds are controlled | expire in May 2024. This new currently | | --- | --- | --- | | In making this statement, the Directors | relative to the Company’s assets, and | undrawn facility, totalling £500m is due | | have reviewed the reports of the Investment |  | to expire in July 2027. | | Manager in relation to the resilience of the | resources are managed to maintain a | | On behalf of the Board Company, taking account of its current reasonable expectation of being able to position, the principal risks facing it in a low    case scenario due to a disrupted recovery commitments, out of internally generated 3 August 2022 in the wake of COVID-19, the geopolitical  uncertainties as a result of the Russia– put in place a revolving credit facility to Pantheon International Plc 55Strategic Report 2022 Manager’s Review Governance Financial Statements Other Information Annual Report and Accounts ## Manager’s Review Portfolio 57 Performance 59 Our Market 63 A Conversation with our Largest Manager 72 Sector Themes 75 Distributions 82 Calls 96 New Commitments 99 Buyout Analysis 114 Other Information 117 Key Pantheon Personnel Supporting PIP 128 Manager’s Review Manager’s Review Pantheon International Plc 56 2022 Strategic Report Governance Financial Statements Other Information Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Portfolio As at 31 May 2022 Since its inception, PIP has been able to generate excellent returns while at the  PIP’s portfolio is weighted towards the more developed same time structuring its portfolio to potential for outperformance. private equity markets in the USA and Europe, while Asia and minimise the risks typically associated with Emerging Markets provide access to faster-growing economies. private equity investments. Our established portfolio of assets has been carefully selected, based on the strengths of our 1 1 Investment type  appointed private equity managers,   risks; and managed to maximise growth and liquidity over time. ### Type and region ### Maturity and stage Primary  USA  Co-investments  Europe  2 Secondary  Asia and EM  3 Global  1 Fund investment type and region charts are based upon underlying fund and company valuations. The charts exclude the portion of the reference portfolio attributable to the Asset Linked Note. 2 EM is Emerging Markets. 3 Global category contains funds with no target allocation to any particular region equal to or  Manager’s Review Pantheon International Plc 57 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Portfolio As at 31 May 2022 Since its inception, PIP has been able to generate excellent returns while at the We are managing PIP’s portfolio to remain cash generative  same time structuring its portfolio to  on growth and buyout investments. minimise the risks typically associated with assets. As at 31 May 2022, the average age of PIP’s portfolio private equity investments. Our established was 4.9 years. portfolio of assets has been carefully selected, based on the strengths of our 1 1   appointed private equity managers,   risks; and managed to maximise growth and liquidity over time. ### Type and region ### Maturity and stage | 2021 and later  | Small/mid buyout  | | --- | --- | | 2020  | Large/mega buyout  | | 2019  | Growth  | | 2018  | Special situations  | | 2017  | Venture  | 2016  2015  2014  2011–2013  2010 and earlier  1 Fund stage and maturity charts are based upon underlying fund and company valuations. The charts exclude the portion of the reference portfolio attributable to the Asset Linked Note. Manager’s Review Pantheon International Plc 58 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Performance Overall, PIP’s underlying portfolio continues to deliver robust returns. The cash-generative   tilt towards high-quality assets and more Including returns attributable to the ALN share of the portfolio, PIP’s total portfolio generated investment returns, prior to foreign resilient sectors has helped underpin  performance during the year. £169m (£419m) £160m £2,200m £2,100m ### Private equity portfolio £436m £187m ### movements £1,900m £1,700m ### Valuation gains by type £1,667m £1,500m ###  £1,300m £1,100m £2,300m | Valuation gains by region | £900m | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | Portfolio value | Valuation | FX impact | Distributions | Calls | | New | Portfolio value | | | | 31 May 2021 | gains | | | | investments | | 31 May 2022 | Manager’s Review Pantheon International Plc 59 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Performance Overall, PIP’s underlying portfolio continues to deliver robust returns. The cash-generative Impressive performance across all strategies over the year, with primaries producing particularly attractive returns.  tilt towards high-quality assets and more resilient sectors has helped underpin performance during the year. ### Private equity portfolio 34.8% ### movements 30% 1 ### Valuation gains by type 20% 22.3% RETURN 20.4% ###  10% 40% ### Valuation gains by region 0% Primary Co-investment Secondary Closing portfolio 38% 31% 31% NAV% 1 Portfolio returns include income, exclude gains and losses from foreign exchange movements, and look through underlying vehicle structures to the underlying funds. Portfolio returns exclude returns generated by the portion of the reference portfolio attributable to the ALN, and are calculated by dividing valuation gains by opening portfolio values. Manager’s Review Pantheon International Plc 60 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Performance Overall, PIP’s underlying portfolio continues to deliver robust returns. The cash-generative   tilt towards high-quality assets and more resilient sectors has helped underpin performance during the year. ### Private equity portfolio 33.7% 33.6% ### movements 30% 27.3% 26.2% ### Valuation gains by type 23.2% 20% RETURN 1 ### Valuation gains by stage 40% 10% ### Valuation gains by region 0% Venture Growth Small/ Special situations Large/ mega buyout mid buyout Closing portfolio 4% 7% 24% 26% 39% NAV% 1 Portfolio returns include income, exclude gains    generated by the portion of the reference portfolio    Manager’s Review Pantheon International Plc 61 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Performance Overall, PIP’s underlying portfolio continues to deliver robust returns. The cash-generative Impressive performance across all regions driven by exits and favourable valuation movements.  tilt towards high-quality assets and more resilient sectors has helped underpin performance during the year. 28.6% ### Private equity portfolio 25% 25.8% ### movements 23.6% 23.3% 20% ###  15% RETURN 10% ### Valuation gains by stage 30% 5% 1 ### Valuation gains by region 0% USA Europe Global Asia and EM Closing portfolio 51% 11% 28% 10% NAV% 1 Portfolio returns include income, exclude gains and losses from foreign exchange movements, and look through underlying vehicle structures to the underlying funds. Portfolio returns exclude returns generated by the portion of the reference portfolio attributable to the ALN, and are calculated by dividing valuation gains by opening portfolio values. Manager’s Review Pantheon International Plc 62 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Our Market ## Targeting highly resilient ## businesses,  Partner at Pantheon and manager of PIP ## positive long-term secular While many countries are still grappling been the sharp fall in public markets ## trends, in an uncertain | | with the aftermath of the COVID-19 crisis, |  | | --- | --- | --- | | | the tragic war in Ukraine has generated | forecasters struggling to identify many | | | further turmoil. Global supply chain issues, | causes for optimism on the horizon. | | macroeconomic | which were triggered by successive | | Private equity is not immune to geopolitical lockdowns during the pandemic, have been and macroeconomic events; however, exacerbated over the past few months our private equity managers had been ## environment  preparing for a downturn for some time sourcing certain essential raw materials. and taking action to prepare their portfolio As a result, there have been shortages of  ### Against a backdrop of heightened geopolitical tensions and vital industrial components, logistical times. Furthermore, assessing our challenges when transporting merchandise ### the uncertain outlook for the global economy, Helen Steers, managers’ track records in steering their and increasing concerns about food portfolios through previous crises forms a ### Partner at Pantheon and manager of PIP, discusses how the security and energy supply, particularly in key component of our due diligence when  ### private equity sector and PIP are well-positioned to navigate considering new deals for investment. fuelled by higher food prices and energy History has shown that the best private ### this challenging environment. costs, means that many household equity managers are able to adapt to budgets are being squeezed and consumer volatile market conditions, working closely  with their portfolio companies, and GDP in many regions rebounded in 2021 have outperformed the public markets from the COVID-induced lows of 2020, throughout economic cycles. In addition, global growth expectations have been they are able to respond nimbly and revised down dramatically for 2022 and capitalise on periods of market dislocation fears of a global recession are increasingly and disruption, which can often generate becoming a reality. One of the immediate compelling new deal opportunities. consequences of these developments has Manager’s Review Pantheon International Plc 63 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Our Market These may present themselves in a variety with managers also completing a large of ways such as the creation of investments number of add-on acquisitions during the 2 | | |  | ($ in bn) | | --- | --- | --- | --- | | at more attractive pricing levels, or assisting | year. Although fundraising strength has | | | | companies to build market share through | continued into 2022, we expect to see a | | | | consolidation and add-on acquisitions of | moderation in the coming months as the | | | | weaker competitors. | bifurcation between the top-rated private | | | equity managers, who are able to raise Following a slowdown in fundraising in capital quickly via oversubscribed funds 2020 during the COVID-19 pandemic, the regardless of the macroeconomic global private equity industry had a record environment, and those managers who 3 year in 2021, raising US$749bn of capital.  Investment activity was also very buoyant becomes even more pronounced. 4 with $837bn invested in buyout deals 500 1  ($bn) 300 749 200 700 689 651 600 603 0 565 | | 800 | | | 2014 | 2015 | 2016 | 2017 | | 2018 2019 2020 | 2021 | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 900 | | 500 | | | | | | | | | | | | | 487 | | | | | YEAR | | | 800 400 Buyout Private Investment in Public Equities Other 378 700 356 Growth Public to Private 300 600 200 100 1 Source: Preqin Private Equity. Excludes secondaries, funds of funds, and co-investment vehicles to avoid double 400 counting of capital fundraised. 2 Source: Preqin. Deal activity based on completed and announced deals globally from January 1, 2013 to March 31, 0 2022. Excludes venture. “Other” includes add-ons, distressed debt, merger, recapitalisation, restructuring, special situations and turnarounds. 2014 2015 2016 2017 2018 2019 2020 2021 CAPITAL RAISED (US$BN) 3 Source: Preqin Private Equity. Excludes secondaries, funds of funds, and co-investment vehicles to avoid double YEAR counting of capital fundraised. 4 Source: Preqin Private Equity. 100 Manager’s Review Pantheon International Plc 64 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Our Market  reliant on the IPO markets being open in in recent years and dry powder, which is order to realise their investments. During  capital raised but not yet invested, stood  5 |  | | | 6 | | | --- | --- | --- | --- | --- | | | | at US$1.32tn as at September 2021 | . |  | | | | We expect the levels of dry powder to | | other private equity managers while, | | | |  | | despite a strong year for IPOs in 2021, only | | | 900 | secondary and tertiary buyouts, although | |  | 3,500 there are signs that market volatility may were exited by them being taken public. 800 impact new investment activity during the In the current environment, it is more 3,000 course of 2022. important than ever to be highly selective 700 Nevertheless, since dry powder is when assessing deals for investment. We 2,500 | | 600 | concentrated in the larger global buyout | will continue to back high-quality private | | --- | --- | --- | --- | | | | funds, which often target secondary buyouts | equity managers who are sector specialists | | 2,000 | 500 | of smaller, high-growth businesses, PIP’s |  | | | | weighting towards the small/mid-market | and experienced operational teams to | | | 400 | buyout and growth segments of the market | support their portfolio companies through | 1,500  uncertainty. While it is possible that there 300 from this exit route. The majority of the may be some pressure on the valuations of 1,000 managers with whom PIP invests focus on certain private equity-backed companies, 200 selling their portfolio companies to trade we expect this to be very dependent on the 500 buyers, progressing their own strategic and subsectors in which those businesses 100 | | | | | | | | M&A objectives, as well as selling their |  | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | portfolio companies to other private equity | new capital expenditure. PIP’s portfolio is | | | 0 | | | | | 0 | | | | | | | | | | | managers. In other words, they are not | weighted towards resilient and high-growth | | 4,000 | | 2014 | 2015 20172016 2018 | 2019 | 1,000 2020 2021 | | | | YEAR ### Trade sale Sale to private equity manager Merger  Private placement IPO Other Buyout exits ($bn) ### focus on selling their portfolio companies to trade ### NO. OF FUNDS  ###  ###  ###  5 Preqin industry data for number of direct buyouts and growth equity exits globally, accessed May 2022.  Buyout includes growth capital. 6 Source: 2022 Preqin Global Private Equity Report. AVERAGE CAPITAL RAISSED (US$BN) Manager’s Review Pantheon International Plc 65 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Our Market sectors such as Information Technology the increasing demand for better quality and Healthcare, which held up well through healthcare services in developing countries 7   and the prevalence of chronic diseases long-term secular trends that we believe are everywhere. A common theme linking here to stay. We focus on managers who these businesses is that they have stable, are targeting non-cyclical companies for recurring revenues and the characteristics 44 investment that have defensible business to produce sustainable positive earnings models and offer a differentiated product or growth. Private equity managers control service, giving them a competitive advantage the businesses in which they are invested and pricing power in their respective and therefore are able to respond markets. While we note the stark declines in effectively to changing market conditions the share prices of many technology stocks and implement necessary operational 32 | in the public markets, the technology-related | and strategic changes. Finally, it should be | | 30 | | --- | --- | --- | --- | | businesses in PIP’s portfolio are primarily | noted that private equity managers are | | | |  | not under pressure to sell their assets, | | | | business infrastructure companies | therefore they will only do so when the time | 2424 | | | providing essential “need to have” products |  | | | | and services as well as those supporting | can achieve an attractive return on exit. | | | 19 18 | | the digitalisation and automation of | The embedded value in PIP’s portfolio has | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | processes that are occurring across many | been demonstrated by the consistently | | | | | | | | different sectors. In healthcare, which is the | positive average uplifts that have been | | | | | | | | second largest sector in PIP’s portfolio, we | achieved since 2011, when we started | | | | | | | | are backing managers who are tapping into | tracking this metric. During the period, the | | | | | | | | the opportunities arising from the needs of | weighted average uplift in PIP’s portfolio | 2014 | 2015 | 2016 2017 2020 | 2018 | 2019 | | 50% | ageing populations in developed economies, |  | | | | | | YEAR 46 45% ###  40% ### only assess how our managers create the right ### 35%  ###  30% ###  25% ### companies, that can withstand increases in interest ### rates and any potential pressure on margins. 20% 7 Greenhill – Global Secondary Market Review, January 2022. 15% Manager’s Review Pantheon International Plc 66 2022 10% 2021 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Our Market As part of our detailed due diligence instigate deals in order to provide liquidity in ownership can sometimes bring. We Pantheon was a pioneer of the secondary process, we not only assess how our options for investors in their funds. We have believe that this area of the secondaries market and has both the expertise as well managers create the right operating seen an increase in the size and complexity market is particularly attractive because:  models for their portfolio businesses, of deals coming to market and also in the carry out the necessary detailed due diligence – Typically these are the managers’ star but also appraise our managers’ ability to quality with some of the most sophisticated, on manager-led deals. In many cases, assets that they believe are likely to construct appropriate capital structures top-ranked private equity managers now we are able to work with the private equity  for their investee companies, that can actively participating in the secondaries manager to assist them with price discovery more time beyond the life of the existing withstand increases in interest rates and market. This has fuelled unprecedented and help them to shape the deals themselves. fund or additional capital, which the any potential pressure on margins. PIP’s growth in manager-led deals, which can PIP’s total commitment of US$225.0m to existing fund does not have, to achieve it; portfolio is tilted towards asset-light consist of either multi-asset portfolios or the Pantheon Secondary Opportunity Fund companies, which typically have no debt single-asset secondaries. Single-asset – These transactions provide strong  (in the case of companies in the growth secondaries accounted for approximately alignment with the private equity in these high-quality assets on favourable capital stage), or lower levels of debt (in the half of the manager-led transactions managers who roll their interests into the terms. PIP gains access to single-asset 9 case of small and mid-sized businesses), in 2021 . continuation fund and, in many cases, secondaries both directly and through  increase their own existing investment; PSOF, and during the period, invested in Managers are reluctant to sell high-quality nine single-asset secondaries.  portfolio companies, which they believe – These transactions tend to have an  still have scope for further value creation,  While the current elevated macroeconomic  therefore single-asset secondaries occur offer the opportunity to invest alongside risks call for a more cautious approach, the when a private equity manager moves an   Increasingly, the global secondaries individual company out of an older fund, from the continued success of the in the secondaries market and we expect market is establishing itself as an active which is in the process of being liquidated, company; and this to continue. The mid-market, which portfolio management tool for a wide into a continuation fund. This allows can often be overlooked by less experienced range of investors in private equity funds – It is a very specialised part of the existing investors in the fund to exit their  who are seeking liquidity for their investments. secondaries market and therefore positions in the older fund while at the part of PIP’s portfolio and we believe that As a result, it has continued to experience tends to be less competitive. same time the private equity manager can it should continue to provide attractive strong growth with transaction volumes continue to invest in the company and build opportunities for PIP. 8 reaching record levels of US$134bn in 2021. value. Selected investors, such as PIP, are  offered the opportunity to invest in the new secondary transactions, which is when the  investor in a fund initiates a sales process ### company’s future growth. The management   teams of the underlying companies are ### manager-led deals, which is when the  invariably supportive of this approach as private equity managers themselves they can avoid the disruption that a change ###  ###  8 Source: Greenhill Cogent – Global Secondary Market Review, January 2022. 9 Source: Lazard Private Capital Advisory, Sponsor-led Secondary Market Report 2021, January 2022. Manager’s Review Pantheon International Plc 67 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Our Market The best private equity managers are global network of primary and secondary Pantheon continues to assess each – We focus on attractive, resilient sectors becoming increasingly restrictive, meaning relationships from which we are able to co-investment opportunity on its own that are experiencing long-term tailwinds that only those investors who have source co-investment opportunities. In merits with each co-investment passing and have the potential for strong organic established deep, long-standing relationships many cases, the strength of our relationships  growth through the launch of additional with such managers are given priority has resulted in us being offered proprietary  products and services; access to their investment opportunities. deals whereby we are the only party to be one of our best private equity managers, – The business has the ability to maintain Pantheon has an almost 40-year history of invited to co-invest alongside a manager. who themselves have already passed revenue and margin stability even in an investing in the secondaries market and, our rigorous manager selection hurdles. The co-investment market has become economic downturn; and  The opportunity is then subjected to our increasingly competitive; however, we approach, has established itself as a own detailed due diligence process, carried – There is the potential for add-on believe that Pantheon has a distinct partner of choice for many private equity out by our dedicated co-investment team. acquisitions that can help the business advantage and is an attractive co-investor managers. Our sizeable secondaries team Our disciplined and selective approach to build scale and grow its market share. for our managers because: is led by seven Partners who have an means that we will typically only invest  average of around 23 years of investment – We do not compete against them and in companies that display the following portfolio at the period end and we expect experience each. The recent appointment are viewed as a desirable investment attributes:  | of a new Global Head of Private Equity | partner; as a result, we believe that we | | | | --- | --- | --- | --- | | | | – We focus only on compelling | investment. During the period, PIP received | | Secondaries at Partner level will further | see a large proportion of co-investments | | | | | | opportunities with the highest-quality | £49.5m from the sale of EUSA Pharma, | | strengthen our deal origination and | on offer from our core managers around | | | | | | managers that we believe are able to | a UK-based specialty pharmaceutical | | investment capabilities, which we can | the world; | | | | | | meet our return expectations; | company focusing on oncology and rare | put to work on behalf of PIP. – Our consistent reliability in co-underwriting diseases. PIP co-invested in EUSA Pharma –   transactions means that we have become alongside EW Healthcare in 2015 and manager’s geographical, sectoral and  a “go to” partner for many of our private it represents the Company’s largest single stage expertise and experience; equity managers; company exit in its history. See the case Pantheon had a very active year in terms of – There are multiple and clear value study on page 70. both deal origination for co-investments, – We have the scale to deploy substantial creation levers that our managers  capital quickly into new deals and can pull; and exit activity which was also strong. follow-on investments; and Co-investments are attractive for PIP as – We have proven our willingness to step they enable the Company to invest directly in at an early stage to help our managers in exciting high-growth companies on the ### to secure and execute upon exciting  same terms and conditions as the private opportunities through co-underwriting equity manager, while they are also typically ### primary and secondary relationships from which we are transactions. free of management and performance ###   10 Source: Preqin H2 2022 investor outlook survey. 11 Source: 2022 Preqin Global Private Equity Report. Manager’s Review Pantheon International Plc 68 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Our Market Outlook investing directly into the companies and funds that are sourced for it by Pantheon, 12  ($ billion) The impact of substantially lower economic  growth globally, coupled with supply chain portfolio towards where we see the best issues, higher energy, food and input costs, opportunities. PIP’s portfolio has been and the lingering effects of the COVID-19 deliberately positioned to be resilient in crisis, is creating an unenviable mix of times of stress while at the same time we 10,000 challenges which are being faced by both are seeking investments with strong sector individuals and businesses. tailwinds behind them to drive growth.  The dispersion of returns in private equity 8,000 times, we believe that our industry will is wide, therefore having access to and  selecting the highest-quality managers is  key. Private equity managers have evolved 6,000 | | from a long-term investment horizon, | their teams enormously in recent years to | | --- | --- | --- | | | still comprises a relatively small part of | include operational, strategic and capital | | | the wider global investment universe | markets experts that they can dedicate to | | 4,000 | | improving the prospects of a portfolio | and investor appetite for the asset class | | remains strong – in a recent survey | company in a variety of market conditions. | | --- | --- | --- | | |  | Over the long term, this hands-on approach | | 2,000 | | has resulted in the companies in PIP’s | participants indicated that they intended | | | | | | | | | | | | | | | | | | | to maintain or increase their allocations | |  | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | 10 | stronger revenue and earnings growth | | | | | | | | | | | | | | | | | | | | to private equity investments | . Indeed, | | | 12,000 | 0 | | | | | | | | | | | | | | | | | in its most recent report, Preqin forecasted | | when compared with companies in the | | | | | | | | | | | | | | | | | | | | that the assets under management in the | | MSCI World index. | | | | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | | | | | | global private equity and venture capital | | | | | | | | | | | | | | | | | 2022F | 2023F | 2024F | 2025F | 2026F | | | In addition, investors should note that | 2021A market would reach US$11.1tn in 2026, YEAR for more than three decades, Pantheon which compares with the private equity has managed PIP throughout different market being worth US$5.3tn at the end economic cycles to deliver long-term 11 of 2021 . outperformance over the FTSE All-Share Private equity offers access to subsectors and MSCI World Indices. We believe that that are generally under-represented in our experience, PIP’s access to many of the the public markets and that continue to best private equity managers globally, its innovate and offer compelling long-term conservatively managed balance sheet investment opportunities. and the exciting opportunities in PIP’s full deal pipeline, provide the vital ingredients  for being able to weather the storm and to  continue to secure healthy returns for PIP’s position will serve it well through shareholders over the long term. uncertainty. Its approach to mainly   Manager’s Review Pantheon International Plc 69 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Distributions case study |  | | 1 |  | | | --- | --- | --- | --- | --- | | | £49.5m | | | Healthcare | | Manager | EW Healthcare (“EW”) | | Stage | Small/Mid Buyout | |  | Europe | | Vintage | 2015 | | Type | Co-investment | |  | Trade sale | ## Treating childhood cancers ## and providing hope Headquartered in the UK, EUSA Pharma is a global, specialty in-licensing pharmaceutical company focused on oncology and rare diseases. 1 Excluding proceeds held in escrow. Manager’s Review Pantheon International Plc 70 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Distributions case study Investment rationale specialty pharmaceutical platforms  ### PIP’s largest ever single alongside private equity deal sponsors. | company distribution | – Established business infrastructure | | EUSA Pharma was acquired by Italian | | --- | --- | --- | --- | | | including a sales and marketing | – The credentials of EW which is one of the | pharmaceutical company Recordati in | | | network, and a product portfolio and | longest-established healthcare-focused | December 2021, providing a full exit for |  | | management team which EW could | growth equity and buyout specialist | EW and for PIP. The overall return to PIP | | --- | --- | --- | --- | | –  For the treatment of paediatric | |  | | | | leverage to grow the licensing platform. | | is c.5.0x of invested cost with the vast | | neuroblastoma. Neuroblastoma is a | | invested in over 150 companies to date. | | majority of the distributions already – Pipeline of potential acquisition and rare cancerous tumour that begins in the  licensing opportunities in Europe and Our relationship nerve tissue of infants and very young the US targeting companies offering  Pantheon has a well-established complementary products and patients are in the high-risk category, relationship with EW Healthcare dating distribution networks. meaning they have the greatest back to 2004. Pantheon holds an advisory likelihood of relapse during treatment. – EW’s prior experience in working with board seat on the four most recent EW EUSA Pharma’s founder who had funds, and PIP is an investor in each of – For the treatment of renal cell successfully built and grown two those funds. carcinoma. Renal carcinoma is the most common form of kidney cancer and usually affects adults aged in their 60s and 70s. ### Value Creation 2016 2017 2018 2021 –  For the treatment of Timeline Multicentric Castleman’s disease ## (lymph node disorder). It is a rare 2022 disease that affects lymph nodes and other immune cell structures in Investment by EW Acquired Qarziba and Secured additional equity Acquired Sylvant to Approval of Qarziba Received full proceeds and PIP Fotivda to expand  accelerate US expansion; and Sylvant in China; from the sale in the body and can severely weaken product portfolio approval and launch sale of critical care pivoted the business to May 2022 at c.5.0x the immune system. of new products business; secured focus on commercial of invested cost  activities and increased – For the treatment of oral Received EMEA approval   for Qarziba and Fotivda; ## 2015  Sold in a trade sale mucosa lining around the mouth, and is EUSA’s product and to Recordati in one of the most common complications  December 2021 arising from chemo- and radiotherapies in cancer treatments. Manager’s Review Pantheon International Plc 71 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### A Conversation with Insight Partners ## Capturing early growth ## in software businesses  Managing Director Could you provide a brief overview  We expect the Software-as-a-Service, or ### Helen Steers, Partner at of Insight Partners for us? of our capital is invested in North America, “SaaS”, market to add more than $10tn ### Pantheon and manager  in value over the next 10 years, and the Insight Partners (“Insight”) is one businesses that we invest in aim to ### of PIP, speaks to Cian Cotter,  of the world’s largest investors in capitalise on this growth in global high-growth software companies that ### Managing Director at Insight We believe that we are in the early stages of SaaS spend. drive transformational change in their a multi-decade digital transformation of ### Partners, one of PIP’s largest respective industries. We have over What differentiates your portfolio the global economy. While companies | | 25 years’ experience in the sector | |  | | --- | --- | --- | --- | | private equity managers, | | across industries are investing more into | | | | and have regulatory assets under | |  | digital solutions, and market conditions | about their success. | management of over $90bn. | | | | --- | --- | --- | --- | | | | support continued digital adoption, just | Growth-stage companies are companies | | | What types of investment do you |  |  | | |  | in the cloud, according to our research. | expand, either organically or through | | | | Drilling down further into a few industries, | acquisitions, and have potential for | We are sector specialists, investing ###    in growth-stage software businesses healthcare providers offer eStatements or, frequently, both. Insight invests in ###  through minority and control investments.  companies that apply technology to  fully digital applications. The global solve business and consumer problems, ###  allows our investors to access the best economy has undergone a rapid digital typically through software. available opportunities. We are able to ###  transformation over the past 20 years, capture early growth and then able to but we believe that there is still a huge ###  increase our investment as a minority amount of digital growth to come. investor or to grow the position to one ###  of control. Manager’s Review Pantheon International Plc 72 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### A Conversation with Insight Partners Over time, we have increasingly focused on MURAL is an example of a business driving software companies with high recurring transformational change in the industries revenue achieved primarily through a it serves. MURAL is a collaborative subscription business model or SaaS, intelligence company powering effective which we believe offers a number of key ideation, innovation, alignment and team   building. The company fosters innovation ### who represent their clients with integrity and and lower upfront cost structure makes at scale by providing a digital whiteboard SaaS businesses relatively less risky than and collaboration features for everything ### professionalism. We are grateful for their support. other forms of software and internet from product strategy and planning, investments. The homogeneity of the research and design, to sales and  business model for SaaS companies consulting engagements. The business Managing Director enables pattern recognition with a higher operates in a rapidly expanding market degree of accuracy, which allows Insight and has demonstrated strong growth, to identify key performance indicators to high customer satisfaction, and strong drive successful outcomes. upsells to existing customers. Mural is a collaborative intelligence company | Can you tell us about some of the | A further example is Bullhorn, a | committed to increasing innovation and | | --- | --- | --- | |  | cloud-based software platform for the | problem-solving capacity within organisations. | | |  | Its clients include Fortune 100 companies, | Recorded Future is a market leader in automates end-to-end the talent supply  cybersecurity intelligence, enabling Country USA  have become increasingly dependent on digital  Information Technology customers to prevent and detect cyber workspaces for idea generation and project agencies. Our return on investment thesis threats through an internet-wide dragnet management. investment thesis centred around three of real-time intelligence. We were attracted key areas: the company’s strong market to the company by its differentiated positioning and growth at scale, Bullhorn’s technology approach, which leverages blue-chip customer base with considerable Bullhorn is a provider of cloud-based customer machine learning and automation to opportunity for cross-sell and upsell, and relationship management and operations software collect intelligence at scale from a wide the opportunity to expand the addressable   variety of sources and package it in a market in a highly fragmented industry The company’s software which features an applicant manner that can be utilised by humans through M&A. The business has seen a tracking system, vendor management system and machines. The investment is a great Country USA remarkable growth in revenue and has    Information Technology automation, enables companies to streamline generated strong returns for our investors. investment strategy – we initially led  a minority investment in 2017 which positioned us to later become majority investors in 2019. We believe that our experience with the company and operational expertise will enable Recorded Future to continue to grow. Manager’s Review Pantheon International Plc 73 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### A Conversation with Insight Partners  Can you tell us more about Insight on the growth in this market?  Recorded Future is a developer of threat intelligence analytics software used to lower the risk of  Insight leverages its dedicated, outbound cyberattacks. calling or “sourcing” team, to identify and The Onsite team is dedicated to the The company’s platform, which is powered by track growth-stage software companies. long-term success of our portfolio patented machine learning, allows users to assess Country USA Our sourcing team, comprising of over companies and comprises industry contextualised intelligence in real-time and respond  Information Technology | 60 dedicated employees, contacts around | leaders who have the breadth and depth | | to security threats faster. | | | --- | --- | --- | --- | --- | | 30,000 companies per year and enters the | of experience to help management teams | | | | | information collected into a proprietary | take their companies through the next | | | | |  | stage of growth. The Onsite team is | | | | | on over 175,000 companies. As a result, | designed to support the critical functional | | | | | | | Onsite helps portfolio companies leverage | | Could you tell us more about your | |  | areas necessary for software and | | | | | | | learnings from our top companies and | | relationship with Pantheon? | | sourced by our outbound sourcing team. | technology companies to scale. | | | | operationalise those lessons in the  Data analysis plays an important role in Onsite covers the full spectrum of context of their own business. For example, secondary interests in our Fund IV in 2004 the selection of potential deals. Factors operations of our portfolio companies, Recorded Future has leveraged Onsite in a and that allowed us to start a relationship. considered in this analysis include the including hiring top talent, building number of ways. Onsite’s executive talent Pantheon then committed primary capital total potential addressable market that market-leading products, advising team helped the company source, vet and to Fund V in 2005 and we invited them a company is targeting, the degree to companies on their optimal Go-To-Market interview executives including their Chief to join our limited partner advisory  strategies and supporting inorganic growth  committee. Pantheon has supported each market demand and need, and the rate at through M&A. We believe that Onsite has and Vice President of EMEA sales. Onsite of our subsequent funds and served on which a company is able to acquire new been successful in helping companies also helped the company implement each of our advisory boards since that customers and retain revenue from navigate the challenges presented during detailed Go-To-Market monitoring to time. The relationship has continued existing customers over a sustained the early stages of growth, and as a result enable more predictable sales execution to expand over the past 18 years with period of time. the demand from portfolio companies and re-package their product into modules additional secondary purchases and for Onsite’s expertise has continued to enable faster time-to-value for their  numerous co-investments. to rise. There are now approximately clients. Additionally, Onsite assisted the most compelling high-growth 120 people on the Onsite team, up from Recorded Future with executing and We have found them to be thoughtful and opportunities in the software space 65 people in 2020. In 2021, Onsite integrating two strategic acquisitions, experienced investors who represent their and provide these companies with the supported approximately 350 of our expanding the company’s total clients with integrity and professionalism. strategic and operational support to portfolio companies. addressable market and setting the We are very grateful for their support over be well-positioned at exit and achieve stage for continued growth. such a long period of time. attractive returns. To help with this, our specialist in-house consulting team, “Onsite”, provides our portfolio companies access to best practices in areas such as strategic planning and operations management. Manager’s Review Pantheon International Plc 74 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Sector Themes 1 Pantheon assesses deals across durable long-term demographic  9 1 ### Investing in, or alongside, 8 7 a range of sectors and over the or secular trends underpin 1 Information technology  | managers who have the | past year has seen particularly | demand growth. For example, | | | 6 | | V  |  U S | Y E | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | R | E | |  R | | | | | 2 | Healthcare  | | P | | 9 1 | | 8 interesting investment the accelerated digitalisation of 7 ### expertise to identify and | | | | 3 | Consumer  | | | --- | --- | --- | --- | --- | --- | | | opportunities in Information | processes in many end markets | | | 6 | | capitalise on long-term, | Technology and Healthcare, |  | 4 | Financials  | | 5 as well as attractive deal to the technology sector, while 5 2 5 Industrials  ### secular trends gives PIP access dynamics in certain Consumer, ageing demographics are driving 2 6 Communication services  4 ### to the most promising sectors. Financials and Business Services growth in the healthcare sector. 3 7 Energy  4 sector transactions. PIP focuses on investing in companies with 8 Materials  3 exposure to sub-sectors where 9 Others   Businesses are utilising technology to disrupt traditional sectors and gain market share. Switch to digital payments   Automation of core business practices Polish online marketplace Investment and share Risk assessment trading website based Big data collection and analytics services provider to the in the UK healthcare industry, based in the USA Migration of computing to the cloud German enterprise Provider of online  Move to online shopping and e-commerce system software education based technology company developer for healthcare in the USA services Cybersecurity and data protection TECHNOLOGY INNOVATIONS USA-based developer US-based online wine German digital banking Shift to remote working of a health information retailer  exchange and disclosure services provider management platform    Manager’s Review Pantheon International Plc 75 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Sector Themes INFORMATION TECHNOLOGY HEALTHCARE ## 33 % 18%  The majority of PIP’s exposure to healthcare is in the healthcare services, healthcare 1 software segment. 87% of the IT companies in PIP’s buyout portfolio were EBITDA technology and specialty pharmaceuticals sub-segments. positive in the 12 months ended 31 December 2021 (31 December 2020: 78%). ### Accelerating Ageing population ### digitalisation to underpinning Leading provider of Developer of enterprise US-based opthalmology Provider of healthcare ### enable access demand for mission-critical business and customer practice providing a services to rural software to businesses in engagement software full range of advanced communities based ### healthcare Northern Europe. based in the USA. treatment for eye in the USA. ### services diseases. | Security | | | Growing | | | | --- | --- | --- | --- | --- | --- | | software and big | | | demand for | | | | | Leading provider of | A US-based data | | Global manufacturer of | French provider of | | data analytics | | | speciality | | | | | cloud-based cyberthreat | infrastructure company | | pharmaceutical-grade | pharmaceutical | | | intelligence, based in | that connects all | | Omega 3. | ingredients and | | are increasingly | | | pharmaceutical | | | | | the USA. | applications and systems. | | | specialty chemicals. | | important | | | products | | | ### Reliable, Burgeoning ### earnings positive demand for Developer of data centre US-based provider Leading Chinese contract Operator of hospitals ### IT managed healthcare in monitoring software in of IT, engineering and sales organisation for the and healthcare clinics the USA. analytics services for pharmaceuticals sector. in Romania. ### services emerging the defence industry. ### businesses economies 1 Data based on a sample that represents 37% by number, and 82% by NAV, of the buyout stage, IT companies in PIP’s portfolio. Manager’s Review Pantheon International Plc 76 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Sector Themes CONSUMER FINANCIALS ## 14 % 11% Investments are mainly in resilient consumer-focused businesses, with limited exposure  to companies that are sensitive to economic downturns. sub-segments with their use of technology. ### Robust Sustained ### consumer staple demand for One of the largest Leading non-food A worldwide integrated US-based provider of ### businesses with asset manufacturers of ice discount retailer provider of customised  cream for retailers and in Europe. trust, fund and corporate advisory services. ### strong market management wholesalers in the UK. services worldwide. ### positions services ### Unabated Specialist ### growth in insurance Luxury beauty and US-based online wine Mobile phone insurance Health insurance ### demand for providers cosmetics company retailer. company in the USA. provider In India. based in the UK. ### e-commerce ### Education providers Digital ### experience strong transformation Operator of educational Provider of Specialist lender to small German digital banking ### continued demand of the banking institutions based in research-based and medium sized  the UK. education services enterprises in the UK. services provider. ### for services industry in the USA. Manager’s Review Pantheon International Plc 77 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Largest companies case study | NAV | £11.0m | Type | Primary | | --- | --- | --- | --- | | Manager | Advent International Group |  | Consumer | | | (“Advent”) | Stage | Large/Mega Buyout | |  | USA | Vintage | 2020 | ## An independent ## and revolutionary ## haircare brand Launched in 2014, Olaplex is a fast-growing independent haircare brand with patent-protected products backed by science. It offers a suite of products that use its technologically proven “bond–building” (repairing, strengthening and protecting hair bonds) formula. The company is the number one bond-building brand in the professional channel and a top ranked global brand in specialty retail. Manager’s Review Pantheon International Plc 78 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Largest companies case study Investment rationale – Strengthen its internal R&D team and successfully launch six new –  products (No. 0 Intensive Bond-Building increase in net sales from 2019 to 2020. Pre-Treatment in July 2020, No. 8 Bond | – In 2020, Olaplex was the number one | Intense Moisture Mask in April 2021, | | --- | --- | | haircare brand at Sephora (a popular | No. 4-1 Moisture Mask in July 2021, | | retailer for beauty products) based on | No. 4P Blonde Enhancer Toning Shampoo | |  | in September 2021, No. 9 Bond Protector | | the bestselling ones in their respective | Nourishing Hair Serum in March 2022, | | categories at Beauty Systems Group (one | and No. 4C Bond Maintenance Clarifying | | of the leading distributors globally for | Shampoo in June 2022). | professional/salon use haircare products). – Expand into international markets and – Large and growing global haircare evaluate new market opportunities. market, particularly for products – Navigate the business through the treating damaged hair. pandemic. Advent was able to use the | –  | digital expertise within its team to switch | | --- | --- | | opportunities and expansion of | to an online sales-led strategy during | | addressable market through patented | COVID-19 when salons were closed. | | technology and e-commerce. | This enabled Olaplex to continue operating | through the pandemic, and direct to Our relationship consumer sales, which include Olaplex.com and sales through Pantheon has a well-established relationship third-party eCommerce platforms, with Advent, dating back to 1998, and PIP  is a primary investor in six Advent funds. as at March 2022. Pantheon also holds an advisory board seat for various Advent funds. Since the IPO of Olaplex in September 2021, Advent remains an active shareholder with  three seats on Olaplex’s board of directors During the investment period, Advent and continues to use its sector expertise has worked with Olaplex to: and resources to support the company. Manager’s Review Pantheon International Plc 79 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Largest companies case study Investment rationale – Revolut has developed a mobile application that allows users to exchange currencies at interbank rates, send money through social networks | NAV | £13.7m |  | Information Technology | and spend with a multi-currency card. | | --- | --- | --- | --- | --- | | Manager | | Stage | | It also provides insurance for mobile | | | Index Ventures (“Index”) | | Venture | | phones, medical and travel.  Europe Vintage 2015 Type Primary – Pantheon has a long and extensive primary and co-investment relationship  one of the leading top-tier venture capital  ## Consumer-friendly ## digital banking  companies in Europe and has gained over 18 million customers in 35 countries since it was founded in 2015. Manager’s Review Pantheon International Plc 80 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Largest companies case study | NAV | £12.7m | Type | Co-investment | | --- | --- | --- | --- | | Manager | Main Post Partners |  | Consumer | | | (“Main Post”) | Stage | Large/Mega Buyout | |  | USA | Vintage | 2019 | Investment rationale ## Iconic American – FRG has c.2,355 stores in the USA that generate c.US$ 3.7bn in annual revenues and employ c.73,000 people. In 2021, ## restaurant brands FRG was a part of the largest franchise transaction in American history when it purchased 937 Pizza Hut restaurants and 194 Wendy’s stores for c.US$ 553m. Flynn Restaurant Group (“FRG”) is the largest franchise operator – PIP was offered an opportunity to and one of the 20 largest food service companies in the USA. co-invest in FRG alongside Main Post, Its wholly-owned brands include Taco Bell, Panera Bread, a sector-focused sponsor with a strong Arby’s and Applebee’s restaurants. investment track record. Manager’s Review Pantheon International Plc 81 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Distributions PIP had a record year for distributions, 1 receiving more than 850 distributions  during the 12 months to 31 May 2022, with   conditions supported a good level of exits, particularly from buyouts. uplifts to carrying value. PIP’s mature portfolio is expected to continue to generate  Distributions by stage Distributions by region For the year to 31 May 2022 For the year to 31 May 2022 ### Distributions by region ### and stage ### Quarterly distribution rates ### Distribution rates by ### vintage ### Cost multiples on exit ### realisations Small/mid-buyout  USA  Large/mega-buyout  Europe  Growth  Asia and EM  ### Uplifts on exit realisations Special situations  Global  Venture  ### Exit realisations by sector ### and type   Manager’s Review Pantheon International Plc 82 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Distributions PIP had a record year for distributions, 1 receiving more than 850 distributions  during the 12 months to 31 May 2022, with  uplifts to carrying value. PIP’s mature portfolio is expected to continue to generate  ### Distributions by region 30% ### and stage ### Quarterly distribution 20% 2 ### rates ### Distribution rates by 10% ### vintage 40% ### Cost multiples on exit 0% Feb May Aug Nov Feb May Aug Nov Feb May Aug Nov Feb May Aug Nov Feb May ### realisations 18 18 18 18 19 19 19 19 20 20 20 20 21 21 21 21 22 22 ### Uplifts on exit realisations ### Exit realisations by sector   ### and type   Manager’s Review Pantheon International Plc 83 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Distributions PIP had a record year for distributions, 1 receiving more than 850 distributions 2  at the end of the period (31 May 2021: 5.2 years), PIP’s portfolio should during the 12 months to 31 May 2022, with   uplifts to carrying value. PIP’s mature portfolio is expected to continue to generate  Weighted average age = 4.9 years 50% ### Distributions by region ### and stage 40% ### Quarterly distribution rates 30% 20% ### Distribution rates by ### vintage 10% 60% ### Cost multiples on exit 0% 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 ### realisations and VINTAGE ### Uplifts on exit realisations   ### Exit realisations by sector   and type  Manager’s Review Pantheon International Plc 84 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts earlier ### Distributions PIP had a record year for distributions, 1 receiving more than 850 distributions The average cost multiple on exit realisations of the sample was 3.1 times, demonstrating value creation over the course of during the 12 months to 31 May 2022, with an investment.  uplifts to carrying value. PIP’s mature portfolio is expected to continue to generate  For the year to 31 May 2022 Average cost ### Distributions by region multiple = 3.1x ### and stage 30% ### Quarterly distribution rates 20% ### Distribution rates by ### vintage 10% 40% ### Cost multiples on exit 2 ### realisations 0% <0.5x 0.5x–1.0x 1.0x–1.5x 1.5x–2.0x 2.0x–3.0x 3.0x–4.0x 4.0x–5.0x >5.0x MULTIPLES ON INITIAL COST ### Uplifts on exit realisations ### Exit realisations by sector   ### and type   EXIT REALISATIONS PROCEEDS Manager’s Review Pantheon International Plc 85 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts Number of 84 18 17 14 33 30 18 39 distributions ### Distributions PIP had a record year for distributions, 1 receiving more than 850 distributions  during the 12 months to 31 May 2022, with   uplifts to carrying value. PIP’s mature The method used to calculate the average uplift is to compare the value at exit with the value of the investment 12 months prior portfolio is expected to continue to generate to exit.  For the year to 31 May 2022 Value-weighted ### Distributions by region average uplift = 42% ### and stage 25% 20% ### Quarterly distribution rates 15% ### Distribution rates by 10% ### vintage 30% 5% ### Cost multiples on exit ### realisations 0% <(25) >(25)–(10) >(10)–0 >0–10 >10–25 >25–50 >50–75 >100 >75–100 UPLIFT ON EXIT 2 ### Uplifts on exit realisations ### Exit realisations by sector   ### and type   EXIT REALISATIONS PROCEEDS Manager’s Review Pantheon International Plc 86 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts Number of 70 16 31 26 38 45 33 64 18 distributions ### Distributions PIP had a record year for distributions, 1 receiving more than 850 distributions  during the 12 months to 31 May 2022, with    uplifts to carrying value. PIP’s mature realisations received during the period. portfolio is expected to continue to generate    For the year to 31 May 2022 For the year to 31 May 2022 ### Distributions by region ### and stage ### Quarterly distribution rates ### Distribution rates by ### vintage ### Cost multiples on exit ### realisations Healthcare  Trade sale  Industrials  Secondary buyout  Information technology  Public market sale  ### Uplifts on exit realisations Consumer  Sale to management  Communication services  Energy  Financials  ### Exit realisations by sector Materials  ### and type   Manager’s Review Pantheon International Plc 87 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Distributions case study |  | £9.3m |  | Industrials | | --- | --- | --- | --- | | Manager | Oaktree Capital | Stage | Special Situations | | | Management (“OCM”) | Vintage | 2017 | |  | USA |  | Secondary buyout | | Type | Secondary | | | ## Keeping America supplied ## with essential goods Ports America (“PA”) is the largest terminal operator and stevedore  of US container throughput. The company provides terminal management and a full range of stevedoring and labour services at more than 70 locations in over 33 ports. Manager’s Review Pantheon International Plc 88 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Distributions case study Investment rationale   –  based across all major ports in the The new management team that was USA with a presence on all three implemented by OCM has been actively  involved in transforming the business and the Gulf coasts. from a low-margin stevedoring provider to a higher margin container terminal – Attractive valuation entry point that was operator with long-term contracts. lower than both the long-term sector The management team was supported average and single terminal transaction by experienced professionals from OCM multiples at the time. and was responsible for undertaking Our relationship transformational acquisitions, removing redundancies and building a network of Pantheon has a long-standing relationship  with the private equity manager and has evaluated multiple secondary During the investment period, EBITDA opportunities with OCM. Pantheon also  holds an advisory board seat with OCM. was achieved through: – Cost savings through reductions in  – Exit of low margin sites. – Optimisation of terminal layouts and expansion of terminal capacities.  Ports America was acquired by the Canada Pension Plan Investment Board in November 2021, providing a full exit for OCM and for PIP. Manager’s Review Pantheon International Plc 89 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Distributions case study |  | £2.7m |  | Consumer | | --- | --- | --- | --- | | Manager | ECI Partners (“ECI”) | Stage | Small/Mid Buyout | |  | Europe | Vintage | 2018 | | Type | Primary |  | Secondary buyout | ## Helping people ## enjoy family breaks Travel Chapter is a technology-enabled travel platform for self-catering holidays. Its headquarters are in Devon in the UK with a talented team of highly expert people and its leading brand, holidaycottages.co.uk, specialises in holidays across England, Scotland and Wales. Manager’s Review Pantheon International Plc 90 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Distributions case study Investment rationale   – Acquisition of a leading UK holiday | cottage platform with a strong track | – Seven bolt-on acquisitions between | | --- | --- | | record of organic growth (new and | February 2019 and December 2021, | | repeat bookings, revenue and EBITDA |  | |  | footprint and property base of the | business. – Deep immediate pipeline of M&A |  | – Executed the largest transaction | | --- | --- | | entry, with management having | to date of “Sally’s Cottages”, adding | | a demonstrated track record of | 500+ properties in the Lake District. | successful bolt-on acquisitions. – Supported the business with organic | – Large addressable market with |  | | --- | --- | | sustainable tailwinds, with proven | uptick in sign-ups (1,502 in 2021 vs. | | resilience through economic cycles. | 1,024 in 2019). | | – ECI was able to gain preferential access | – Helped develop the technology team and | | to the opportunity as a result of a 20+ | a data team that implemented several | | year track record in the travel sector | data improvement projects. | and a 15-year relationship with the – The business traded strongly through management team. COVID-19, with annual revenue and Our relationship  the three-year investment period. PIP is a primary investor in four ECI funds and Pantheon holds an advisory board  seat in each fund. Travel Chapter was acquired by Intermediate Capital Group in December 2021, providing an exit for ECI and for PIP and generating a 2.6 times cost multiple  Manager’s Review Pantheon International Plc 91 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Top 50 Distributions  No. Company Website Country   (£m) 1 UK Healthcare Develops and licenses oncology products 49.5 2 USA Healthcare Developer of software for healthcare applications 17.8 3 USA Energy Producer-focused midstream company 12.2 4 USA Communication Services Wireless communication infrastructure provider 11.7 5 USA Industrials Owner and operator of wireless networks and infrastructure 11.1 6 USA Industrials  10.7 7 USA Industrials Provider of infrastructure solutions for ports 9.3 8 USA Information Technology Provider of IT consulting and outsourcing services 8.5 9 USA Communication Services Developer of educational software products 7.4 10 Australia Healthcare Operator of a chain of veterinary clinics 6.8 | | 11 | | USA Communication Services Provider of educational materials and learning solutions 6.3 | | | | --- | --- | --- | --- | --- | --- | | | 12 | | Australia Consumer Educational services and child care provider 6.1 | | | | | 13 | | Finland Healthcare Producer of immunological reagents 5.9 | | | | | 14 | | USA Information Technology Developer of enterprise management software 5.3 | | | | | | Manager’s Review | | Pantheon International Plc 92 | 2022 | | Strategic Report Governance Financial Statements Other Information Annual Report and Accounts | | | | | | ### Top 50 Distributions  No. Company Website Country   (£m) 15 USA Financials Provider of data-driven card services 5.3 16 USA Industrials Provider of strategic consulting services 4.9 17 USA Communication Services Entertainment, media and sports agency 4.7 18 USA Consumer Educational programme provider 4.4 19 USA Healthcare Pharmaceutical research company 4.3 20 New Zealand Industrials Freight and shipping transportation services provider 4.2 21 USA Healthcare Operator of behavioural health centres 4.0 Provides management, technology and risk 22 USA Industrials 4.0 consulting services | | 23 | | Netherlands Information Technology Payment platform developer 4.0 | | | | --- | --- | --- | --- | --- | --- | | | 24 | | USA Industrials Trucking services provider 3.9 | | | | | 25 | | Australia Industrials Distributor of industrial equipment and supplies 3.8 | | | | | 26 | | USA Information Technology Digital branding solution services provider 3.5 | | | | | 27 | | China Healthcare Biotechnology company 3.4 | | | | | 28 | | USA Consumer Learning intervention solution provider 3.4 | | | | | | Manager’s Review | | Pantheon International Plc 93 | 2022 | | Strategic Report Governance Financial Statements Other Information Annual Report and Accounts | | | | | | ### Top 50 Distributions  No. Company Website Country   (£m) 29 USA Information Technology Cloud platform developer 3.3 30 USA Information Technology Leader in secure payment processing solutions 3.3 Provider of outsourced services for life science 31 USA Healthcare 3.2 applications Provider of creative, marketing, branding and 32 USA Communication Services 3.2 administrative services Management consulting and business integration 33 Italy Industrials 3.1 service provider Provider of managed internet and cloud connectivity 34 Netherlands Communication Services 3.0 solutions 35 UK Materials Luxury decorative paint and wallpaper manufacturer 3.0 36 USA Healthcare Developer of software systems for the healthcare sector 2.9 37 USA Information Technology Developer of cloud-based point of sale software 2.9 Provider of trading, risk management and accounting 38 USA Information Technology 2.9 software Business intelligence and Enterprise Resource 39 USA Information Technology 2.9 Planning platform 40 USA Information Technology Designer of learning and education software 2.8 41 UK Consumer Operator of an online holiday rental platform 2.7 Manager’s Review Pantheon International Plc 94 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Top 50 Distributions  No. Company Website Country   (£m) 42 USA Consumer Food and beverages company 2.7 | 43 | USA Healthcare Digital platform for medical professionals 2.6 | | --- | --- | | 44 | India Financials Health insurance company 2.5 | | 45 | Switzerland Healthcare Provider of diagnostic services 2.4 | Provider of telecommunication and internet connectivity 46 Italy Communication Services 2.4 services 47 UK Information Technology Provider of IT support and strategic services 2.3 | 48 | USA Industrials Building materials manufacturer 2.3 | | --- | --- | | 49 | UK Industrials Shipping company 2.3 | | 50 | Norway Information technology  2.2 | Total 287.3 Coverage of total distributions  Manager’s Review Pantheon International Plc 95 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Calls  investments in high-quality businesses  globally. made by private equity managers in the growth and buyout segments. ### Calls by region and stage Calls by region Calls by stage ### Calls by sector ### Quarterly call rate USA  Small/mid-buyout  Europe  Growth  Global  Large/mega-buyout  Asia and EM  Venture  Special situations  Manager’s Review Pantheon International Plc 96 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Calls  investments in high-quality businesses A large proportion of calls were for investments made in the information technology and healthcare sectors. globally. ### Calls by region and stage  Information technology  Healthcare  ### Calls by sector Industrials  Consumer  Communication services  Financials  ### Quarterly call rate Other  Materials  Energy  Manager’s Review Pantheon International Plc 97 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Calls  investments in high-quality businesses  globally. The increase in call rate has been mainly due to PIP’s commitment to single-asset secondaries through the Pantheon Secondary Opportunity Fund (“PSOF”). Commitments to PSOF have an accelerated drawdown over a period of 18 to 24 months. ### Calls by region and stage 35 ### Calls by sector 30 25 1 20 ### Quarterly call rate 15 10 05 40 0 Feb May Aug Nov Feb May Aug Nov Feb May Aug Nov Feb May Aug Nov Feb May 18 18 18 18 19 19 19 19 20 20 20 20 21 21 21 21 22 22 1 Call rate equals calls in the period (annualised) divided  exclude the acquisition cost of new secondary and co-investment transactions. Manager’s Review Pantheon International Plc 98 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments PIP committed £496m to 70 new investments during the year (31 May 2021: £240m,  33 new investments). Of the total commitments made, £160m was drawn Investment opportunities in funds We invest in many of the best Cash generated from the sale at the time of purchase. Since the period and companies are originated private equity managers who are of those companies is returned end, PIP has committed a further £76m via Pantheon’s extensive and able to identify and create value to PIP and redeployed into new  well-established platform. in their businesses. investment opportunities. ### New commitments by ### investment type  ### New commitments Primary  ### by region Co-investment  Secondary  ### New commitments ### by stage ### New commitments ### by vintage Manager’s Review Pantheon International Plc 99 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments PIP committed £496m to 70 new investments during the year (31 May 2021: £240m,  33 new investments). Of the total commitments made, £160m was drawn Investment opportunities in funds We invest in many of the best Cash generated from the sale at the time of purchase. Since the period and companies are originated private equity managers who are of those companies is returned end, PIP has committed a further £76m via Pantheon’s extensive and able to identify and create value to PIP and redeployed into new  well-established platform. in their businesses. investment opportunities. ### New commitments by ### investment type The majority of commitments made in the year were to global and US private equity opportunities. ### New commitments USA  ### by region Global  Europe  Asia and EM  ### New commitments ### by stage ### New commitments ### by vintage Manager’s Review Pantheon International Plc 100 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments PIP committed £496m to 70 new investments during the year (31 May 2021: £240m,  33 new investments). Of the total commitments made, £160m was drawn Investment opportunities in funds We invest in many of the best Cash generated from the sale at the time of purchase. Since the period and companies are originated private equity managers who are of those companies is returned end, PIP has committed a further £76m via Pantheon’s extensive and able to identify and create value to PIP and redeployed into new  well-established platform. in their businesses. investment opportunities. ### New commitments by ### investment type Buyout and growth investment activity was robust during the period. ### New commitments Small/mid buyout  ### by region Growth  Large/mega buyout  Venture  ### New commitments Generalist  ### by stage ### New commitments ### by vintage Manager’s Review Pantheon International Plc 101 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments PIP committed £496m to 70 new investments during the year (31 May 2021: £240m,  33 new investments). Of the total commitments made, £160m was drawn Investment opportunities in funds We invest in many of the best Cash generated from the sale at the time of purchase. Since the period and companies are originated private equity managers who are of those companies is returned end, PIP has committed a further £76m via Pantheon’s extensive and able to identify and create value to PIP and redeployed into new  well-established platform. in their businesses. investment opportunities. ### New commitments by ### investment type  exposure to current vintages. ### New commitments 2022  ### by region 2021  2020 and earlier  ### New commitments ### by stage ### New commitments ### by vintage Manager’s Review Pantheon International Plc 102 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments Investing in primary funds allows PIP to gain exposure to top-tier, well-recognised managers including smaller niche funds that ## Primary committed to 25 primaries during might not typically be traded on the secondary market. ## £262m the year Our focus remains on investing with high-quality, access-constrained managers who have the proven ability to drive value at the ## commitments underlying company level, and to generate strong returns across market cycles. In addition, we target funds with market-leading specialisms in high-growth sectors such as healthcare and information technology. |  |  |  |  |  | | --- | --- | --- | --- | --- | | Stage | Stage | Stage | Stage | Stage | | Large/mega buyout | Growth | Growth | Small/mid buyout | Large/mega buyout | |  |  |  |  |  | | Global large buyout fund | Global growth fund focusing on | North American growth equity fund | Global buyout fund focusing on | European buyout fund focused on the | | | disruptive technology companies | focused on the healthcare sector | ESG-friendly companies | information technology sector | | £21.5m | £20.5m | £18.2m | £17.8m | £14.9m | | Commitment for the year | Commitment for the year | Commitment for the year | Commitment for the year | Commitment for the year | |  |  |  |  |  | | --- | --- | --- | --- | --- | | Stage | Stage | Stage | Stage | Stage | | Small/mid buyout | Growth | Small/mid buyout | Large/mega buyout | Growth | |  |  |  |  |  | | European buyout fund with an | Indian growth fund investing in the | North American buyout fund targeting | North American buyout fund targeting | Asian growth fund focused on | | ESG-focused strategy | small-mid market segment | middle market companies | technology investments | healthcare AI investments | | £14.5m | £14.0m | £13.7m | £13.7m | £11.5m | | Commitment for the year | Commitment for the year | Commitment for the year | Commitment for the year | Commitment for the year | Manager’s Review Pantheon International Plc 103 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments  ## Secondary Top-tier private equity managers are increasingly transferring some of their most attractive portfolio companies into committed to 11 manager-led continuation vehicles, mainly in the form of single-asset secondary transactions during ## £101m secondaries. By holding companies for longer, private equity ## commitments the year managers are able to participate in the companies’ next phase of growth. The private equity secondary market has 1   both in scale and complexity. Despite Commitments  2 Region Stage  £m % strong competition, PIP continues to originate compelling opportunities derived Global Generalist Pantheon fund (PSOF) focused on single-asset secondary 55.6  from Pantheon’s global platform and its transactions market-leading expertise in sourcing and USA Small/mid buyout Transaction involving two companies in the healthcare sector 6.4  executing complex secondary transactions Europe Small/mid buyout Provider of governance, risk & compliance and human capital 6.1  over which it may have proprietary access. management software to the healthcare sector  Secondary fund investments allow the Company to invest in funds at a stage when the underlying companies are ready to be sold to committed to four secondary generate cash distributions. ## £10m fund transactions during the year 1  Commitment  2 Region Stage  £m % USA Small/mid buyout Portfolio of 22 high quality middle market assets 5.7  Global Large/mega buyout Two buyout technology sector specialist funds 4.9  USA Growth Follow-on investments in portfolio companies of a North American 2.8  growth equity fund 1 Companies and funds acquired in secondary transactions are not named due to non-disclosure agreements. 2 Funding level does not include deferred payments. Manager’s Review Pantheon International Plc 104 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments 42 108  ## Co-investments by region Industrials Information technology Europe USA USA  Developer of sustainable committed to 30 co-investments technological solutions for Provider of 3D design, Europe  ## £123m during the year the maritime sector engineering and manufacturing solutions Asia and EM  Global  ##  £9.1m £8.8m extensive primary investment platform which has enabled PIP Commitment for the year Commitment for the year     PIP invests alongside private equity managers who have the    Healthcare Healthcare companies and build value through operational enhancements, Asia and EM USA organic growth and buy-and-build strategies. Information technology  Provider of children’s Provider of high quality Consumer  orthodontics aligner diagnostic imaging services 27 out of 30 commitments to co-investments were alongside investment managers that PIP had already invested with in Financials  the past. ## Industrials  £5.9m £6.0m Commitment for the year Commitment for the year Healthcare  Communication services  112 Financials Industrials USA Europe   Provider of pharmaceutical by stage and advisory services ingredients and specialty chemicals Small/mid buyout  ## £5.5m £4.8m Large/mega buyout  Commitment for the year Commitment for the year Growth  Manager’s Review Pantheon International Plc 105 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments case study | Commitment | £2.7m | Stage | Growth Equity | | --- | --- | --- | --- | | Manager | Altamont Capital Partners |  | Financial Services | | Type | Co-Investment |  | North America | Investment rationale ## Disrupting the global – Differentiated and disruptive business  – Large, growing and uncorrelated ## insurance market insurance market with substantial addressable market. –  Accelerant is a technology enabled insurance exchange that connects   business model.  – Proven and experienced founding in 2019 and has helped grow the business in the intervening period. management team with strong alignment of interests. Manager’s Review Pantheon International Plc 106 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments case study Investment rationale – Prosci is a market-leading provider of Commitment £5.5m  Industrials proprietary change management Manager Leeds Equity Partners (“LEP”) Stage Small/Mid Buyout solutions in a US$10bn+ market. Type Secondary  USA – Proven history of growth in core offerings positioned to accelerate with newly launched digital training and advisory solutions. –     100 companies.   ## Developing agile, During the investment period, LEP plans to focus on the following key growth drivers: – An accelerated rollout of the advisory ## change-ready organisations business. – Bolstering the subscription segment   out a subscription membership and organisations build change management capabilities. It has a opportunity. network of over 30,000 change leaders worldwide through the – Broadening and deepening channel  partner relationships. – Expanding the business through transformative M&A. Manager’s Review Pantheon International Plc 107 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments case study | Commitment | £8.8m | Stage | Small/Mid Buyout | | --- | --- | --- | --- | | Manager | Sentinel Capital Partners |  | Information Technology | | | (“Sentinel”) |  | North America | | Type | Co-Investment | | | ## Expertly engineered ## 3D printing solutions TriMech is a provider of 3D design, engineering and manufacturing solutions in the United States and Canada. The company was founded in 1998 and is headquartered in Virginia, USA, with locations in 15 states across the country and six further locations in Canada. Manager’s Review Pantheon International Plc 108 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments case study | Investment rationale | Our relationship | | --- | --- | | – TriMech is one of the few businesses | Pantheon has a long-term relationship | | operating at scale in an attractive and | with Sentinel; it is a primary investor in | | growing 3D design and printing market. | three of Sentinel’s funds and has two | | The global 3D computer-aided design | advisory board seats with the private | | software market is estimated to be | equity manager. | c. US$10bn in size, and the 3D design  and printing market is estimated to be  c. US$14bn in size; both are expected to | continue to grow in the coming years as | Sentinel has worked on multiple | | --- | --- | | companies utilise 3D software as part |  | | of product development. | TriMech where M&A is a key component | of growth. – TriMech has a diverse customer base | with long-standing relationships that | The company has made numerous | | --- | --- | | provide high recurring revenues through | accretive acquisitions in the past | | multiple revenue streams. Sentinel | 18 months that have broadened its | | sees an opportunity to further diversify | product line. It has continued to identify | | the company’s revenue through | M&A opportunities to help consolidate | | the acquisition of companies with | the sector and provide cross-selling | | complementary product offerings. | opportunities across complementary | products, and has already completed one acquisition following our investment. Manager’s Review Pantheon International Plc 109 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments case study | Commitment | £4.4m | Stage | Small/Mid Buyout | | --- | --- | --- | --- | | Manager | Parthenon Capital Partners |  | Financial Services | | | (“Parthenon”) |  | North America | | Type | Co-Investment | | | ## Restoring trust ## in credit ratings  agencies. The business was founded in 2010 with the aim of restoring trust in credit ratings by creating new standards for assessing risk and offering transparent ratings. It is differentiated through the quality and rigour of its research, its ability to rate niche asset classes with bespoke methodologies, and its competitive pricing. Manager’s Review Pantheon International Plc 110 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments case study Investment rationale   – The addressable market for credit rating agencies is large with very few players   and an outstanding track record in the  – The company has a highly attractive    business model and substantial pricing deep industry expertise and operational power, which leads to high EBITDA capabilities, Parthenon has the knowledge  and resources to assist KBRA with its | Our relationship | expansion. | | --- | --- | | Pantheon has a long-standing relationship | Parthenon sees numerous opportunities | | with Parthenon and is an investor in several | for growth in the business, including the | | of their funds dating back to the early | penetration of new areas of the market, | | 2000s. Pantheon has also participated in | such as alternative asset managers and | | several co-investments with the private | ESG ratings. In addition, international | | equity manager and sits on two of its | expansion and M&A are possible levers | | advisory boards. | for value creation. | Manager’s Review Pantheon International Plc 111 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments case study | Commitment | £4.8m | Stage | Small/Mid Buyout | | --- | --- | --- | --- | | Manager | SK Capital Partners (“SK”) |  | Healthcare | | Type | Co-Investment |  | Europe | ## Securing pharmaceutical ## supply chains Seqens is a global chemicals and active pharmaceutical ingredients manufacturer. The company is a leading supplier of pain relief ingredients in both the Paracetamol and Aspirin supply chains. Seqens is headquartered in France with production facilities and R&D centres located globally. Manager’s Review Pantheon International Plc 112 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### New Commitments case study Investment rationale   – The company is a vertically integrated producer of critical products and is SK has strategically merged Seqens  with another of its portfolio companies, secular tailwinds, such as western Wavelength Pharmaceuticals, which is a reshoring initiatives, which de-risk supply complementary active pharmaceutical chains, and growth in pharmaceutical ingredients manufacturer. The combination supply chain outsourcing. creates a scaled leader in the sector with a global presence and multiple opportunities – In addition, Seqens has historically been for synergies. an undermanaged asset, and therefore  The private equity manager believes that creation opportunities.  be made to the business to create value. Our relationship  | Pantheon has been investing in the | experience in the sector and their ability to | | --- | --- | | manager since 2018 through three primary | reposition the company to drive growth | | funds. SK is a sector specialist; they are | both organically and through M&A. | focused exclusively on the pharmaceutical, chemicals and materials industries. Manager’s Review Pantheon International Plc 113 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts 1 ### Buyout Analysis Weighted average revenue and EBITDA  Annual revenue growth for PIP’s sample buyout companies have continued to exceed growth rates seen among companies that constitute the MSCI World index. Strong top-line 20% performance, disciplined cost control and good earnings growth, together with an 10%  investment thesis of many private 0% equity managers. -10% -20% Dec Dec Dec 19 20 21  ### Revenue and EBITDA 20% ### growth 10% 0% ### Valuation multiple -10% ### Debt multiples 30% Dec Dec Dec 19 20 21 30%   31 December 2021 were calculated using all the PIP buyout sample MSCI World  are based on unaudited data. MSCI data was sourced from Bloomberg. See pages 193 to 196 of the Alternative Performance Measures section for sample calculations and disclosures. -20% Manager’s Review Pantheon International Plc 114 2022 -30% Strategic Report Governance Financial Statements Other Information Annual Report and Accounts 1 ### Buyout Analysis Accounting standards require private equity managers to value their portfolios at fair value. Public market movements can  PIP’s sample-weighted average Enterprise Value (EV)/EBITDA was 16.4 times 16.4x 15x compared to 13.9 times for the MSCI World index. 13.9x PIP invests proportionately more in high-growth sectors such as information 10x technology and healthcare, and these sectors tend to trade at a premium to  PIP’s sample valuation multiple of 16.4 times should be considered in the context of the 5x buyout sample’s underlying growth rates relative to the MSCI World index. 0 ### Revenue and EBITDA PIP buyout sample MSCI World ### growth 20x ### Valuation multiple ### Debt multiples   31 December 2021 were calculated using all the  are based on unaudited data. MSCI data was sourced from Bloomberg. See pages 193 to 196 of the Alternative Performance Measures section for sample calculations and disclosures. Manager’s Review Pantheon International Plc 115 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts 1 ### Buyout Analysis Venture, growth and buyout investments have differing leverage characteristics. Average debt multiples for small/mid buyout investments, which represent the largest segment of PIP’s buyout portfolio, 5.3x are typically lower than debt levels in the large/mega buyout segment. 4.4x 4x The venture and growth portfolios have little or no reliance on leverage. 2x 0 6x ### Revenue and EBITDA Large/mega buyout Small/mid buyout ### growth % of PIP’s 26% 39% portfolio ### Valuation multiple ### Debt multiples   31 December 2021 were calculated using all the  are based on unaudited data. MSCI data was sourced from Bloomberg. See pages 193 to 196 of the Alternative Performance Measures section for sample calculations and disclosures. Manager’s Review Pantheon International Plc 116 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Other Information – The largest 50 managers by value % of total private 1 2 Rank Manager Website Region Stage  1 USA Growth  | 2 | Global Venture, Growth  | | --- | --- | | 3 | USA Buyout, Growth  | | 4 | Global Buyout  | | 5 | Asia & EM Growth  | | 6 | Asia & EM Growth  | | 7 | Europe Buyout  | | 8 | USA Buyout  | | 9 | USA Buyout  | | 10 | USA Buyout  | | 11 | USA Buyout  | | 12 | Europe Buyout  | | 13 | USA Growth  | 1 Refers to the regional exposure of funds. 2 Percentages look through underlying vehicle structures and exclude the portion of the reference portfolio attributable to the ALN. Manager’s Review Pantheon International Plc 117 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Other Information – The largest 50 managers by value % of total private 1 2 Rank Manager Website Region Stage  14 USA Buyout  | 15 | Europe Buyout  | | --- | --- | | 16 | Global Special situations  | | 17 | Europe Buyout  | | 18 | USA Buyout  | | 19 | USA Special situations  | | 20 | USA Growth  | | 21 | USA Special situations  | | 22 | USA Buyout  | | 23 | USA Buyout  | | 24 | Europe Buyout  | | 25 | USA Buyout  | | 26 | USA Buyout  | 1 Refers to the regional exposure of funds. 2 Percentages look through underlying vehicle structures and exclude the portion of the reference portfolio attributable to the ALN. Manager’s Review Pantheon International Plc 118 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Other Information – The largest 50 managers by value % of total private 1 2 Rank Manager Website Region Stage  27 Global Buyout  28 Global Growth  29 Europe Buyout  3 | 30 Growth Fund | USA Growth  | | --- | --- | | 31 | Europe Buyout  | | 32 | USA Buyout  | | 33 | USA Growth  | | 34 | Europe Buyout  | | 35 | USA Buyout  | | 36 | USA Buyout  | | 37 | Europe Buyout  | | 38 | Asia & EM Buyout  | 1 Refers to the regional exposure of funds. 2 Percentages look through underlying vehicle structures and exclude the portion of the reference portfolio attributable to the ALN. 3 The private equity manager does not permit the Company to disclose this information. Manager’s Review Pantheon International Plc 119 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Other Information – The largest 50 managers by value % of total private 1 2 Rank Manager Website Region Stage  39 USA Growth  40 Europe Venture  3 | 41 Growth Fund | USA Growth  | | --- | --- | | 42 | Europe Buyout  | | 43 | Europe Buyout  | | 44 IVF Advisors Private Limited | Asia & EM Buyout  | | 45 | Europe Buyout  | | 46 | Asia & EM Special situations  | | 47 | USA Buyout  | | 48 | Europe Buyout  | | 49 | Europe Buyout  | | 50 | USA Buyout  |   1 Refers to the regional exposure of funds. 2 Percentages look through underlying vehicle structures and exclude the portion of the reference portfolio attributable to the ALN. 3 The private equity manager does not permit the Company to disclose this information. Manager’s Review Pantheon International Plc 120 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts 1 ### The largest 50 companies by value  % of PIP Company Website Country  private Investment type  portfolio Secondary; 1 USA Healthcare Private Leading healthcare provider  Co-investment Primary; 2 USA Financials Private Secondary; Mobile phone insurance company  Co-investment Primary; 3 Norway Information Technology Private Provider of enterprise software solutions  Co-investment 4 USA Healthcare Private Secondary Specialist eye treatment provider  Primary; 5 USA Information Technology Private Secondary; Cybersecurity software company  Co-investment Secondary; 6 USA Energy Private Natural gas and oil producer  Co-investment Secondary; 7 Hong Kong Financials Private   Co-investment 8 India Financials Public Co-Investment Health insurance provider  9 USA Consumer Public Co-Investment Online distributor of pet food and supplies  Primary; 10 USA Information Technology Private Secondary; Managed IT services provider  Co-investment 2 11 Software Company USA Information Technology Private Co-Investment Security management solutions provider  12 USA Information Technology Private Co-Investment IT services management company  1 The largest 50 companies table is based upon underlying company valuations at 31 March 2022 adjusted for known call and distributions to 31 May 2022, and includes the portion of the reference portfolio attributable to the ALN. 2 The private equity manager does not permit the Company to disclose this information. Manager’s Review Pantheon International Plc 121 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts 1 ### The largest 50 companies by value  % of PIP Company Website Country  private Investment type  portfolio Primary; 13 USA Information Technology Private Provider of broadband solutions  Secondary 14 Netherlands Consumer Private Secondary Non-food discount stores  15 Germany Healthcare Private Secondary Specialist pharmaceutical company  Primary; 16 UK Information Technology Private Fintech company offering banking services  Secondary Primary; 17 USA Consumer Private Restaurant franchise  Co-investment 18 UK Consumer Private Secondary Ice cream and frozen food manufacturer  2 19 Project Fusion USA Healthcare Private Secondary Commercial services platform for the life science sector  Secondary; 20 USA Communication Services Private Content provider to the legal industry  Co-investment Secondary; 21 USA Information Technology Private Mobile data analytics company  Co-investment In-home entertainment, education and interactive 22 India Communication Services Private Co-Investment  services provider Primary; 23 Switzerland Information Technology Private Developer of coding software  Secondary 24 USA Consumer Public Primary Manufacturer of premium hair treatments  25 USA Communication Services Private Secondary Entertainment, media and sports agency  1 The largest 50 companies table is based upon underlying company valuations at 31 March 2022 adjusted for known call and distributions to 31 May 2022, and includes the portion of the reference portfolio attributable to the ALN. 2 The private equity manager does not permit the Company to disclose this information. Manager’s Review Pantheon International Plc 122 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts 1 ### The largest 50 companies by value  % of PIP Company Website Country  private Investment type  portfolio Secondary; 26 USA Consumer Private Manufacturer of vehicle suspension products  Co-investment Primary; 27 USA Healthcare Private Provider of disclosure management services  Co-investment 28 USA Financials Private Co-Investment Commercial insurance broker  29 USA Industrials Private Secondary Digital marketing and recruitment services provider  30 USA Information Technology Public Primary Business intelligence provider  Primary; 31 Hong Kong Consumer Private Operator of educational institutions  Co-investment 32 Australia Consumer Private Secondary Producer of beef and other animal protein products  33 USA Financials Private Co-Investment Provider of specialty insurance products  Primary; 34 USA Information Technology Private   Secondary 35 China Healthcare Public Primary Biotechnology company  2 36 Eagle Investment Trust Australia Industrials Private Co-Investment Provider of transport and logistics services  Provider of risk assessment services to the healthcare 37 USA Healthcare Private Primary  industry 38 Israel Information Technology Private Co-Investment Provider of cloud consulting and engineering services  1 The largest 50 companies table is based upon underlying company valuations at 31 March 2022 adjusted for known call and distributions to 31 May 2022, and includes the portion of the reference portfolio attributable to the ALN. 2 The private equity manager does not permit the Company to disclose this information. Manager’s Review Pantheon International Plc 123 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts 1 ### The largest 50 companies by value  % of PIP Company Website Country  private Investment type  portfolio Secondary; 39 USA Healthcare Private Provider of fertility preservation services  Co-investment 40 Israel Information Technology Public Primary Offers software development platforms  Primary; 41 UK Financials Private Secondary; Commercial bank  Co-investment Primary; 42 USA Information Technology Private Digital security company  Secondary Developer of an HR management and recruitment 43 Germany Information Technology Private Primary  platform Primary;  44 France Information Technology Private Secondary;  management Co-investment 45 Romania Healthcare Private Secondary Operator of hospitals and healthcare clinics  46 USA Healthcare Private Co-Investment Healthcare service provider  2 47 Project Phoenix France Communication Services Private Co-Investment Satellite communication provider  48 USA Financials Private Secondary Provider of advisory services to insurance companies  49 Romania Consumer Private Co-Investment Supermarket chain  50 South Korea Financials Private Secondary Life insurance company    1 The largest 50 companies table is based upon underlying company valuations at 31 March 2022 adjusted for known call and distributions to 31 May 2022, and includes the portion of the reference portfolio attributable to the ALN. 2 The private equity manager does not permit the Company to disclose this information. Manager’s Review Pantheon International Plc 124 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Portfolio Concentration 70 managers and 597 companies account 1  2  70 60 50 40 30 20 NUMBER OF MANAGERS 10 0 20 8040 60 EXPOSURE (%) 3  600 500 400 300 200 100 0 20 8040 60 EXPOSURE (%) 1 Exposure is equivalent to the sum of the NAV and undrawn commitments. 2 Excludes the portion of the portfolio attributable to the Asset Linked Note. 3 Excludes the portion of the portfolio attributable to the Asset Linked Note. NUMBER OF COMPANIES Manager’s Review Pantheon International Plc 125 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Historical Data | |  | | | 2 | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | NAV | | NAV per share | | |  | |  | |  | | | (£m) | | |  | | |  | | (£m) | | (£m) | Year ended 31 May 2022 2,427 451.6 295.5 2,239 755 3  2021 1,865 344.8 272.0 1,714 528 2020 1,559 288.3 206.5 1,496 541 2019 1,499 27 7.1 222.5 1,450 521 2018 1,307 241.5 201.0 1,275 440 2017 1,388 219.0 179.3 1,224 445 2016 1,187 187.4 128.5 1,072 382 2015 1,000 153.2 127.2 862 256 2014 902 136.4 115.0 815 176 2013 903 133.2 104.2 826 195 2012 845 119.4 72.6 800 191 2011 733 110.4 71.4 810 243 2010 637 95.9 48.6 763 331 2009 514 77.4 29.5 648 428 2008 736 110.9 75.0 806 641 2007 610 91.9 91.8 527 528 2006 441 79.7 72.7 372 365 2005 382 65.8 65.1 315 245 2004 245 5 7.3 46.3 233 137 2003 221 54.7 44.7 237 158 2002 196 54.2 48.7 175 138 2001 206 66.9 57.4 201 138 1 Includes participating loan notes in issue between 2000 and 2004.   3 In April 2017, PIP changed its accounting reference date from 30 June to 31 May of each year. Figures for 2017 cover the 11 months to 31 May 2017. Manager’s Review Pantheon International Plc 126 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Historical Data | |  | | | 2 | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | NAV | | NAV per share | | |  | |  | |  | | | (£m) | | |  | | |  | | (£m) | | (£m) | 3  2000 161 60.0 45.8 140 77 1999 146 40.6 30.3 78 45 1998 131 36.9 29.5 79 50 1997 117 32.8 27.0 73 47 1996 106 30.3 22.5 48 25 1995 87 25.5 20.8 33 8 1994 47 24.0 17.7 42 7 1993 31 19.6 17.3 28 1 1992 21 14.0 9.4 28 0 1991 21 12.9 8.7 31 1 1990 20 12.7 8.1 32 2 1989 17 12.1 9.5 25 2 1988 12 10.3 7.5 2 0 1 Includes participating loan notes in issue between 2000 and 2004.   3 In April 2017, PIP changed its accounting reference date from 30 June to 31 May of each year. Figures for 2017 cover the 11 months to 31 May 2017. Manager’s Review Pantheon International Plc 127 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Key Pantheon Personnel Supporting PIP |  |  | Maria Candelario |  | | --- | --- | --- | --- | | PIP and European Primary Investment, | Head of Investor Relations and | Principal | Senior Product Controller | | Partner |  | | | | | | Joined in 2014; 14 years of private equity and | Joined 2020; 9 years of private equity | | Joined 2004; 32 years of private equity | Joined 2016; over 13 years of investor | investment banking experience. Maria is | experience. Farid is a Senior Product | | experience. Helen is a Partner in Pantheon’s | relations and communications experience | responsible for investment strategy, portfolio | Controller within Pantheon’s Product Control | | European Investment Team and is | with publicly listed companies. She is also a |  | Team, where he has operational oversight for | | responsible for managing the activities |  | for PIP. Prior to joining Pantheon, Maria | the reporting, valuation and external audit of | | of PIP. She is a member of Pantheon’s | Policy Committee. Prior to joining Pantheon, | worked in mergers and acquisitions at Credit | PIP. Prior to joining Pantheon, Farid was the | | International Investment Committee, |  | Suisse, where she evaluated investments | Financial Controller for John Laing Capital | | European Investment Committee and | 250 companies, as well as at a Dutch-listed | and was responsible for executing buy and | Management, responsible for their listed | | Co-Investment Committee. Prior to joining |  | sell-side M&A transactions across a variety |  | | Pantheon, Helen held senior positions at | |  | and operations roles within 3i Group plc, | | Russell Investments in Paris and at the | | positions at Citi and IBM. Maria is based | before moving to their listed infrastructure | | Caisse de dépôt et placement du Québec in | | in London. | fund. Farid is based in London. | Montréal. Helen is a past Chair and member of the Council (Board) of the British Private Equity and Venture Capital Association (BVCA). She has also served as a Board member of Invest Europe and is a co-founder of Level 20. Helen is based in London. Manager’s Review Pantheon International Plc 128 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Key Pantheon Personnel Supporting PIP | Rhoddy Swire | Paul Ward |  | Jeff Miller | | --- | --- | --- | --- | | Senior Partner | Managing Partner | Head of Investment, Partner | Global Head of Private Equity, Partner | | Rhoddy is Pantheon’s founder and was a |  | Joined 2007; 42 years of private markets | Joined 2008; 21 years of private equity | | Director of PIP from its listing in 1987 until | experience. Paul is Pantheon’s Managing | experience. Dennis is a Partner and | experience. Jeff is a Partner and Global Head | | October 2019. In 1981 Rhoddy joined GT | Partner and is a member of the Partnership | Pantheon’s Head of Investment with | of Private Equity. He is also Global Head of | | Management Ltd to oversee and manage | Board. Paul joined Pantheon from Lehman | management oversight of the investment | Co-investments, leading all underlying | | unquoted investments and subsequently | Brothers Private Equity Group, where he was | team heads. He is a member of Pantheon’s | co-investment activities and team | | led the buyout from GT Management Ltd to | Investment Director. Previously, he worked | Partnership Board, Executive Committee, | management, and is a member of Pantheon’s | | form Pantheon. He was, until 12 October | for Lehman Brothers Investment Bank | International Investment Committee, | Global Partnership Board, International | | 2011, a Director of Pantheon Ventures | in New York and London on M&A and | Co-Investment Committee, Global Secondary | Investment Committee, Co-investment | | Limited, a parent undertaking of Pantheon |  | Investment Committee, US Investment | Committee and US Investment Committee. | | Ventures (UK) LLP, and is a Director of a |  | Committee, and Global Credit Committee. | Prior to joining Pantheon, Jeff was a Principal | | number of Pantheon funds. Rhoddy is also |  | Dennis was previously the Head of the US | at Allied Capital, where he was responsible | | Chairman of both Quail Digital and Azquo | | Partnership Team at Adams Street Partners, | for evaluating and executing private equity | | Holdings Ltd, and is Deputy Lieutenant | | where he was responsible for primary and | and mezzanine investments. Previously, | |  | | secondary fund investments and was a | he was a Vice President in Lehman Brothers’ | | board meetings. | |  | investment banking division. He is based | | | | committee. Prior to this, Dennis held several | in San Francisco. | investment banking and principal investing positions with Bank of America and Continental Bank. Dennis is based in Chicago. Manager’s Review Pantheon International Plc 129 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Key Pantheon Personnel Supporting PIP |  |  |  |  | | --- | --- | --- | --- | | European Primary Investment, Partner | Asian Investment, Partner | Secondary Investment, Partner | Secondary Investment, Partner | | Joined 2005; 24 years of private markets | Joined 2013; 24 years of private equity | Joined 2001; 25 years of experience. Elly is | Joined 2007; Rudy is a Partner and Co-Head | | experience. Alex is a Partner in Pantheon’s | experience. Jie is a Partner in Pantheon’s Asia | a Partner in Pantheon’s Global Secondaries | of Pantheon’s Global Secondaries Team, | | European Investment Team, chairs the | Investment Team, a member of Pantheon’s | Investment Team and a member of the | leading Pantheon’s secondaries presence in | | European Investment Committee and | Asian Regional Investment Committee and |  | the US. He is a member of the International | | co-chairs the ESG Committee. Prior to joining | Global Co-Investment Committee, and | Elly focuses on all aspects of sourcing, | Investment Committee and Global Secondary | | Pantheon, Alex worked for the West Midlands | Co-Head of the Global ESG Committee. | evaluation and execution of private equity | Investment Committee. Rudy was previously | | Pension Fund managing their Private Equity | Jie joined Pantheon from Morgan Stanley | secondary investments. Prior to joining | a partner at Coller Capital, where he was a key | | portfolio. Alex is based in London. | Alternative Investment Partners’ private | Pantheon, Elly worked as an investment | member of the senior team. Prior to Coller | | | equity fund-of-funds group, where she was | manager on the analysis, structuring and | Capital, Rudy worked at Thomas H. Lee | | | Head of Asia, and before that she worked at | execution of direct private equity investments | Putnam Ventures, Merrill Lynch and Skadden | | |  | at British International Investment, a | Arps. Rudy is based in New York. | | | Chair of the Hong Kong Venture Capital and | Development Finance Institution backed by | | | | Private Equity Association – the largest | the UK Government. Elly worked previously | | | | private equity industry association in Asia | for Accenture and PricewaterhouseCoopers | | | |  | on a range of international management | | | | founded and chairs its ESG Committee and |  | | | | co-chairs its LP Committee. Jie is based in | assignments. Elly is based in London. | | Hong Kong. Manager’s Review Pantheon International Plc 130 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ### Key Pantheon Personnel Supporting PIP |  |  |  |  | | --- | --- | --- | --- | | Secondary Investment, Partner | US Primary Investment, Partner | Co-Investment, Partner |  | | Joined 2006; 16 years of private equity | Joined in 2002; 27 years of private equity | Joined 2007; 21 years of private equity | Joined 1999; 21 years of private markets | | experience. Petra is a Partner in Pantheon’s | experience. Susan is a Partner in Pantheon’s | experience. Erik is a Partner in Pantheon’s | experience. Graeme is a Partner and | | Global Secondaries Team, where she | US Investment Team and leads Pantheon’s | Global Co-Investment Team and a member |  | | is involved in all aspects of secondary | global business development. She is a | of the Co-Investment Committee and | responsibility for global risk management. | | investments including the analysis, | member of Pantheon’s Partnership Board, | European Investment Committee. Erik is | Graeme also heads up the Performance | | evaluation and completion of secondary | Executive Committee, International | responsible for sourcing, execution and | Analytics function. He is a member of | | transactions. She is a member of the Global | Investment Committee, the US Investment | monitoring co-investments in Europe. | Pantheon’s Risk Committee and ESG | | Secondary Investment Committee and has |  | Prior to Pantheon, Erik worked for the | Committee. Prior to taking on the role of Chief | | been a member of the secondary team since | of Pantheon Securities, LLC. Prior to joining | Abu Dhabi Investment Authority, IFRS |  | | joining Pantheon in 2006. Prior to joining | Pantheon, Susan was a principal at Capital Z | Foundation in the UK and with Quilvest | Head of Operations, responsible for global | | Pantheon, Petra was an investment banking | Partners in Asia, and a director at Russell | Asia in Hong Kong. Erik is based in London. |  | | analyst at Lehman Brothers, focusing on | Investments’ private equity group. Susan | | processing, maintenance and reconciliation | |  | has served on the Board of the American | | of transactions, valuations and company | | Petra is based in London. | Investment Council, the Investment | | data for clients and Pantheon fund-of-funds | | | Committee for the Archdiocese of San | | within Pantheon’s in-house systems. Graeme | | | Francisco and was a Term Member of the | | is based in London. | Council on Foreign Relations. Susan is based in San Francisco. Manager’s Review Pantheon International Plc 131 2022 Strategic Report Governance Financial Statements Other Information Annual Report and Accounts ## Governance Board of Directors 133 Directors’ Report 135 Statement on Corporate Governance 140 Audit Committee Report 147 Directors’ Remuneration Report 150 Directors’ Responsibility Statement 153 Independent Auditor’s Report to the Members of Pantheon International Plc 154 Governance Governance Pantheon International Plc 132 Pantheon International Plc 132 2022 2022 Strategic Report Manager’s Review Financial Statements Other Information Strategic report Manager’s review Financial statements Other information Annual Report and Accounts Annual Report and Accounts ### Board of Directors | Mary Ann Sieghart | M | N | I | David Melvin | A | M | N | IA | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Senior Independent Director | | | | Audit Committee Chair | | | | | | Appointed to the Board 30 October 2019 | | | | Appointed to the Board 23 February 2015 | | | | | | Ms Sieghart is a Non-Executive Director of | | | |  | | | | | | The Merchants Trust plc and the Guardian | | | | professional with over 30 years of experience | | | | | | Media Group. She is the Chair of the Investment | | | | in investment banking and private equity. He is | | | | | | Committee of the Scott Trust, which owns | | | | currently a senior adviser at CITIC CLSA Securities, | | | | | | The Guardian and The Observer. In addition, | | | | a CITIC Securities Company, senior adviser at | | | | | | she is a Trustee of the Kennedy Memorial Trust, | | | |  | | | | | | among other voluntary posts. | | | | Chairman of HBA Media Limited, Principal at | | | | | 24 Haymarket Private Capital and a member of  A M N I Ms Sieghart is also a political journalist and the Investment Committee of Gonville and Caius broadcaster and was formerly Assistant Editor College, Cambridge. Chair of The Times, a Lex columnist at the Financial Times and City Editor of Today. She is a Visiting Professor Mr Melvin was formerly a Partner at TDR Capital, Appointed to the Board 22 November 2011 of King’s College London and also spent the  academic year 2018–19 as a Visiting Fellow member of the Investment Committee and Head of Appointed as Chair on 23 November 2016. Sir Laurie Magnus has over 40 years of investment banking of All Souls College, Oxford. Investor Relations. Prior to that, he spent 24 years at  Merrill Lynch, where he held a number of leadership Investment Bank) and then successively at Phoenix Securities, Donaldson Lufkin & Jenrette, Credit Suisse positions, including Global Co-Head of Financial First Boston and Lexicon Partners (latterly as Chairman). Sponsors and Chairman of EMEA Financial He is currently Chairman of The City of London Investment Trust plc and a non-executive adviser to the   Chartered Accountant. and Monuments Commission for England (“Historic England”) and a trustee of the English Heritage Trust. Governance Pantheon International Plc 133 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Board of Directors  A Member of the Audit Committee M Member of the Management Engagement Committee N Member of the Nomination Committee I Independent of the Manager | John Singer | A | M | N | I |  | A | M | N | I |  | A | M | N | I | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Appointed to the Board 23 November 2016 | | | | | Appointed to the Board 23 November 2016 | | | | | Appointed to the Board 31 October 2019 | | | | | |  | | | | | Mr Burgess has over 20 years’ experience within | | | | | Dame Sue Owen is an economist with over 30 years’ | | | | | | professional with over 30 years’ experience in | | | | | private equity, following eight years with the Boston | | | | | experience in government, including 14 years at the | | | | | | private equity. Mr Singer spent over 20 years with | | | | | Consulting Group in Paris and London, where he | | | | | Treasury. She led the Department for Digital, Culture, | | | | | | Advent International plc as co-founder, member | | | | | became a Partner. | | | | | Media and Sport from 2013 to 2019, having also | | | | | | of the Global Executive Committee and, until 2012, | | | | | | | | | | worked in the British Embassy in Washington DC, | | | | | Subsequently, he held senior roles with F&C Chairman of European Operations. He was Managing No. 10, the Department of International Development Ventures Ltd and Candover Investments plc before Director and founder of Granville Europe plc, one and as Strategy Director General in the Department co-founding BC Partners (formerly Baring Capital  for Work and Pensions overseeing a £200bn budget. Investors Ltd) in 1986, where he was a Managing In addition, he was Chairman of the European She has considerable experience of governance, Partner until 2005. While at BC Partners, he held Venture Capital Association. making board and chair appointments including directorships of a variety of companies across at the BBC, Ofcom and the Tate. She chaired the Mr Singer is involved with several organisations the UK and Continental Europe. Civil Service Charity and was Civil Service within the arts and education sectors. He is a Diversity Champion. Since 2005, he has remained actively involved in Trustee of the National Gallery, London, Chairman private equity, as well as increasing his investment of City of London Sinfonia, and Chairman of Currently, Dame Sue is chair of UK Debt Management interests in the public markets. Mr Burgess is an the National Youth Orchestra of Great Britain.   Independent Member of the Governing Body of the Flint-Global and non executive Director at Pool Re, Royal Academy of Music and was a Director of the Serco plc and Methera Global Communications. Business Growth Fund Plc.  Governors and is a trustee of Opera Holland Park, and the IFS. Governance Pantheon International Plc 134 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Directors’ Report Company and its Directors concerning  registered unless the shareholder is not ### The Directors are pleased to  evidence (if any) as the Directors may him/herself in default as regards supplying ### present their report, together reasonably require to show the right of the the information required (and the Directors  transferor to make the transfer and (ii) not  ###  Any amendments to the Articles of in favour of more than four persons jointly. regards supplying such information is statements of the Company for Association must be made by special The Directors may decline to register a interested in any of the shares that are resolution at a general meeting of  subject of the transfer) or unless the ### the year ended 31 May 2022. | | the shareholders. |  | transfer arises as a result of the acceptance | | --- | --- | --- | --- | | | | Securities Regulations 2001 and where, | of a takeover offer or a sale made through a | |  | Share Capital | | | | | | in the case of a transfer to joint holders, | recognised investment exchange (or any | | The names and full biographies of the | The rights attaching to the Company’s | the number of joint holders to whom the | other stock exchange outside the UK on | | Directors can be found on pages 133 and | shares are set out in the Company’s |  | which the Company’s shares are normally | | 134. Susannah Nicklin retired from the | Articles of Association. Further details | exceeds four. If the Directors decline to | traded) or is a transfer which the Directors | | Board on 27 October 2021 and Tamara |  | register a transfer, they are required to send |  | | Sakovska was appointed to the Board on | statements. | notice of the refusal to the transferee within |  | | 1 March 2022 and subsequently resigned | | two months, giving reasons for their decision. | shares to a person who is unconnected | Authorities given to the Directors at the | from the Board on 22 July 2022. As at | | | with the shareholder and with any other | | --- | --- | --- | --- | | | AGM on 27 October 2021 to allot shares, | Unless the Directors determine otherwise, | | | 31 May 2022, the Board of Directors of the | | | person appearing interested in the shares. | | | disapply statutory pre-emption rights | a holder of ordinary shares will cease | | Company was comprised of four male and buy back shares will expire at the to be entitled to attend or vote at general The Company’s Articles of Association Directors and three female Directors. forthcoming AGM. During the year meetings of the Company or on any poll if contain additional provisions enabling As at the date of this report the Board of 3,400,830 shares were bought back he/she fails to comply with a request by the the Directors to take certain steps where Directors of the Company is comprised and subsequently cancelled. Company to provide details of any interest ordinary shares are or may be owned, or of four male Directors and two | | | held by any person in his/her ordinary | rights attaching to such shares may be | | --- | --- | --- | --- | | female Directors. | As at 31 May 2022 and as at the date of this | | | | | | shares within 14 days of the request being | exercised, by persons in circumstances | Report, the Company had shares in issue With the exception of Sir Laurie Magnus made. Additionally, if the shares represent which the Directors determine would give as shown in the table below, all of which CBE, all Directors will retire and stand for  rise to a regulatory burden under certain  re-election at the Company’s Annual respect of the shares will be withheld by US securities, investment and pension the Financial Conduct Authority (“FCA”) General Meeting (“AGM”) on 18 October the Company and no transfers of any of laws and regulations. and admitted to trading on the London 2022. Sir Laurie Magnus CBE will be retiring  Stock Exchange. No shares were held in from the Board upon conclusion of the Treasury at the year end. | AGM. Further details regarding the | |  | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | Voting rights | Number of | | selection and appointment of Directors, | The Company’s ordinary shares are freely | | | | | | | | | | | Number of | attached to | shares held in | | including the Company’s position on | transferable. However, the Directors may | | | | | | | | | | shares in issue | | each share | Treasury | | diversity, can be found on page 144. | refuse to register a transfer of shares held | | | | | | Ordinary shares of 6.7p each 537,493,640 1 –  The rules concerning the appointment paid unless the instrument of transfer is Total voting rights 537,493,640 – – and replacement of Directors are set out (i) lodged, duly stamped at the Company’s in the Company’s Articles of Association.  There are no agreements between the Governance Pantheon International Plc 135 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Directors’ Report | Save as described above, there are no | manager, Pantheon Ventures (UK) (“Pantheon | The Manager is entitled to a monthly | performance fee was payable, compounded | | --- | --- | --- | --- | | restrictions concerning the transfer of | Ventures”), on 22 July 2014, under which | management fee as at an annual rate of: |  | | securities in the Company or on voting | Pantheon Ventures was appointed as the | | completed calculation period up to the |   rights; no special rights with regard to Company’s Alternative Investment Fund start of the calculation period for which the investment assets up to £150m and | control attached to securities; no | Manager (“AIFM”) on the terms of and | | | fee is being calculated. For the calculation | | --- | --- | --- | --- | --- | | agreements between holders of securities | subject to the conditions of a new investment |   | | year ended 31 May 2022, the notional | | regarding their transfer known to the | Management Agreement (the “Management | | excess of £150m. | performance fee hurdle is a net asset | | Company; and no agreements which the | Agreement”) between the Company and | | | value per share of 461.2p. | In addition, the Manager is entitled to a Company is party to that might affect its Pantheon Ventures. Pantheon Ventures,  The performance fee is calculated so as to control following a successful takeover bid. which is part of the Pantheon Group, has on the aggregate amount committed (but ignore the effect on performance of any been approved as an AIFM by the FCA. The giving of authority to issue or buy unpaid) in respect of investments, up to a performance fee payable in respect of the back the Company’s shares requires an The Pantheon Group is one of the world’s maximum amount equal to the total value period for which the fee is being calculated appropriate resolution to be passed by foremost private equity fund investors and of the Company’s investment assets. or of any increase or decrease in the net shareholders. Proposals for the renewal has acted as Manager to the Company assets of the Company resulting from any The arrangements in respect of the of the Board’s current authorities to issue since the Company’s inception in 1987. issue, redemption or purchase of any management fee and notice period are | and buy back shares will be set out in the | | | shares or other securities, the sale of any | | --- | --- | --- | --- | | |  | materially unchanged. | | | separate 2022 AGM Notice. | | | treasury shares or the issue or cancellation | alongside senior members of the Pantheon | | | The Manager is entitled to a performance | of any subscription or conversion rights | | --- | --- | --- | --- | | Dividends | team, acquired the Pantheon Group in 2010. | | | | | | fee from the Company in respect of each | for any shares or other securities and any | The ownership structure, with Pantheon  12-month calendar period. No performance other reduction in the Company’s share senior management owning a meaningful fee is payable in respect of the year ended capital or any distribution to shareholders. Investment Trust Status share of the equity in the business, provides 31 May 2022 (period ended 31 May 2021: a framework for long-term succession and The value of investments in, and outstanding The Company has received written £nil). Further detail as to how the enables Pantheon management to continue commitments to, investment funds managed approval from HM Revenue & Customs performance fee is calculated is set  or advised by the Pantheon Group (“Pantheon (“HMRC”) as an authorised investment out below. AMG is a global asset management company Funds”) are excluded in calculating the trust under Section 1158 of the Corporation with equity investments in leading boutique The Company entered into a Supplemental monthly management fee and the Tax Act 2010. The Directors are of the  Agreement with Pantheon Ventures on commitment fee. In addition, the Manager opinion that the Company has conducted | | | 18 April 2017 to align the Management | has agreed that the total fees (including | | --- | --- | --- | --- | | its affairs in compliance with such approval | Under the terms of the Management | | | | | | Agreement with the change to the | performance fees) payable by Pantheon | | and intends to continue doing so. | Agreement, Pantheon Ventures has been | | | | | | Company’s accounting reference date | Funds to members of the Pantheon | appointed as the sole and exclusive  from 30 June to 31 May of each year. Group and attributable to the Company’s discretionary manager of all the assets investments in Pantheon Funds shall  of the Company and to provide certain The performance fee payable in respect of be less than the total fees (excluding the policies for managing these risks are set additional services in connection with the  performance fee) that the Company would  management and administration of the amount by which the net asset value at the have been charged under the Management (on pages 185 to 188). Company’s affairs, including monitoring  Agreement had it invested directly in all of the performance of, and giving instructions applicable “high-water mark”, i.e., the net the underlying investments of the relevant Management on behalf of the Company to, other service asset value at the end of the previous Pantheon Funds instead of through the providers to the Company. calculation period in respect of which a The Company entered into a Management relevant Pantheon Funds. Agreement with the Company’s investment Governance Pantheon International Plc 136 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Directors’ Report The Management Agreement is capable of An alternative basis for the allocation to  the disrupted recovery in the wake of being terminated (without penalty to the the Company of secondary investment the COVID-19 pandemic, the geopolitical Administrative, accounting and company Company) by either party giving two years’ opportunities may be applied by Pantheon uncertainties as a result of the Russia– secretarial services are provided by Link notice in writing. It is capable of being in the context of a successor fund to  Alternative Fund Administrators Limited. terminated by the Company (without Pantheon Global Secondary Fund VI. the global supply chain, increases in the The Administration Agreement may be penalty to the Company) immediately if, In the event of Pantheon and the Company  terminated with 12 months’ written notice. among other things, the Manager materially being unable to agree any such alternative  breaches its obligations (and cannot or allocation basis, Pantheon will cease to The Board has also appointed BNP Paribas the impact of climate change on PIP’s does not remedy the breach) or goes into be entitled to any performance fee for Trust Corporation UK Limited (previously portfolio using the information available up liquidation, and on six months’ notice if calculation periods following that in which BNP Paribas Securities Services, London  there is a change of control of the Manager the alternative allocation basis takes Branch) to act as the Company’s Depositary statements. or if certain “key man” provisions are effect and the Company will be entitled to (as required by the AIFM Directive) The Directors have also considered the  terminate the Management Agreement (the “Depositary”) subject to the terms and Company’s position with reference to its an indemnity from the Company in respect (without penalty to the Company) on conditions of a Depositary Agreement, as investment trust structure, its business of liabilities arising out of the proper six months’ notice. updated in 2022 by a Deed of Novation model, its business objectives, the principal | performance by the Manager of its duties | | and Amendment, entered into between the | | | --- | --- | --- | --- | | | Continuing appointment of | | risks and uncertainties as detailed on | | and compliance with instructions given to | | Company, the AIFM and the Depositary. | | | | the Manager | | pages 46 to 49 of this report and its present | | it by the Board and an exclusion of liability | | BNP Paribas Trust Corporation UK Limited | |  save to the extent of any negligence, fraud, The Board keeps the performance of the have also been appointed as Custodian. the overall assessment, the Directors have willful default or breach of duty. Manager under continual review, and the Full details of the Board’s engagement with taken into account the Manager’s culture, Management Engagement Committee service providers are set out on page 145. Pantheon Ventures sources, evaluates and which emphasises collaboration and carries out an annual review of the manages investments on the Company’s  accountability, the Manager’s conservative Manager’s performance and the terms of behalf, allocating investments to the approach to balance sheet management, the Management Agreement. The ongoing Related party transactions are disclosed Company, in accordance with Pantheon’s and its emphasis on investing with review of the Manager includes activities  investment allocation policy, that are in line underlying private equity managers that and performance over the course of the with the strategy agreed with the Board are focused on market outperformance.  year and review against the Company’s and the Company’s investment objective peer group. The Board is of the opinion At each Board meeting, the Directors and policy. The Company’s business activities, that it is in the interests of shareholders review the Company’s latest management together with the factors likely to affect Under the terms of the Management as a whole to continue the appointment.  its future development, performance, Agreement, the Company is entitled to The Company’s commitments to private  The reasons for this view are that the participate in allocations made by the equity investments are reviewed, together Strategic Report and Manager’s Review. investment performance is satisfactory Pantheon Group under its secondary  and the Manager is well placed to continue investment programme, in accordance The Directors have made an assessment held and its borrowing capability. One-year to manage the assets of the Company with the allocation basis agreed from of the going concern, taking into account  according to the Company’s strategy. time to time between the Company and  and discussed at each meeting. Further details of the Board’s engagement the Manager. the Balance Sheet date and the expected with the Manager is set out on page 142. performance of the Company, considering Governance Pantheon International Plc 137 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Directors’ Report PIP’s Balance Sheet is managed to ensure  Shareholdings  commitments, which are carefully controlled be wholly accurate statements of actual holdings as at relative to its assets and available liquidity. As at 31 May 2022, the Company’s top ten shareholders were:  This disciplined approach enables the  required until the next applicable threshold is crossed: Company to withstand periods of volatility | | Name Shareholding | voting rights | | | | | --- | --- | --- | --- | --- | --- | | such as those experienced as a result | | | Number of | |  | | | USS 44,102,280 8.20 | | shares held | voting rights | | of the COVID-19 pandemic and the  Contassur Assistance Conseil 31,101,440 5.79 Australian Retirement Trust Pty Ltd 20,321,730 3.78 Quilter Investors 28,730,000 5.34 The Directors have considered downside liquidity modelling scenarios with varying PostSuper Pty Ltd as Rathbones 24,495,314 4.56 degrees of decline in investment valuations, trustee for Australia Post APG Asset Management 24,000,000 4.46 decreased investment distributions, Superannuation Scheme 0 0 Quilter Cheviot Investment and increased call rates, with the worst Private Syndicate Pty Ltd Management 22,878,997 4.26 | being an extreme downside scenario | | as trustee for Alternative | | --- | --- | --- | | representing an impact to the portfolio | Border to Coast Pensions | Investment Private Syndicate 0 0 | | that is worse than that experienced during | Partnership 22,078,170 4.11 | | East Riding Pension Fund 0 0  Investec Wealth & Investment 21,004,694 3.91 –  In the event of a downside scenario, PIP Australian Retirement Trust 20,321,730 3.78  can take steps to limit or mitigate the West Midlands PF 17,15 8,0 4 0 3.19  impact on the Balance Sheet, namely drawing on the credit facility and pausing –  Major interests in shares on new commitments. In addition, subject Asset Management N.V. that its holdings had changed to the prevailing market environment, it   could raise additional credit or capital, and of the following disclosable interests in the voting rights of sell assets to increase liquidity and reduce –  the Company. This information was correct at the date of outstanding commitments.   Since the period end, the Company has announced that it has agreed a new multi- currency revolving credit facility to replace After due consideration of the Balance  the existing one that was due to expire in Sheet, activities of the Company, its assets, for the year ended 31 May 2022. May 2024. This new currently undrawn facility,  totalling £500m is due to expire in July 2027. For this reason, they consider it appropriate resources, the Directors have concluded to continue to adopt the going concern that the Company has adequate resources  to continue in operation for at least 12 months Governance Pantheon International Plc 138 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Directors’ Report  Listing Rule 15.4.29(R), the Company, Donations Audit information as a closed ended investment fund, is The Board consists solely of Non-Executive The Company made no political or  currently exempt from complying with Directors and no one individual has charitable donations during the year of approval of the Report of the Directors the Task Force on Climate-related unfettered powers of decision. The Board (2021: nil).  Financial Disclosures. has put in place levels of corporate is no relevant audit information of which  | governance which it believes are | Further details of the Investment | | the Company’s Auditor is unaware; and | | --- | --- | --- | --- | | appropriate for an investment trust and to | Manager’s approach to responsible | The outlook for the Company is set out in | each Director has taken all reasonable | | enable the Company to comply with the | investment practices and ESG standards | the Chair’s Statement on pages 16 to 21. | steps that he or she ought to have taken as | | AIC Code of Corporate Governance (the | can be found in the Strategic Report on | | a Director to make himself or herself aware |  “AIC Code”) published in February 2019. pages 14 to 15. of any relevant audit information and to The Board’s compliance with the AIC Code Listing Rule 9.8.4 requires the Company establish that the Company’s Auditor is  is detailed in the Statement on Corporate to include certain information in a single aware of that information. Governance. In 2015, the UK Government introduced  Approval the Modern Slavery Act (“the Act”). As an a cross-reference table indicating where The Company’s Statement on Corporate Investment Trust, the Company does not the information is set out. The Directors The Directors’ Report has been approved Governance, which forms part of this provide goods or services in the normal  by the Board. Directors’ Report, is set out on pages 140 to course of business, and does not have be made in this regard. 146 and on its website (www.pantheon.com). On behalf of the Board employees, customers or turnover.   Accordingly, the Directors consider that the   Company is not in scope because it does Chair The Company’s AGM will be held on All of the Company’s activities are not have turnover and is therefore not 18 October 2022, and explanations of the outsourced to third parties. As such it does 3 August 2022 required to make any slavery or human business proposed at the AGM will be set not have any physical assets, property,  out in a separate Notice of Meeting which employees or operations of its own and The Company’s own supply chain, which will be published in due course. does not generate any greenhouse gas or consists predominately of professional other emissions or consume any energy advisers and service providers in the reportable under the Companies Act 2006  (Strategic Report and Directors’ Report) to be low risk in relation to this matter. Regulations 2013 or the Companies Details of the Investment Manager’s (Directors’ Report) and Limited Liability approach to Modern Slavery can be found Partnerships (Energy and Carbon Report) in the Strategic Report on page 40 and on Regulations 2018, implementing the UK its website (www.pantheon.com). Government’s policy on Streamlined Energy and Carbon Reporting. Under Governance Pantheon International Plc 139 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Statement on Corporate Governance  associated disclosure requirements under Details of how the Company has applied Company’s Directors bring a wide range of paragraph 9.8.6 of the Listing Rules. the principles of the AIC Code are set out skills, knowledge, experience, backgrounds I am pleased to introduce this year’s in this report. and perspectives. A formal process exists Corporate Governance Statement. In this The UK Code is available on the FRC website for the selection of new Directors to the statement, the Company reports on its (www.frc.org.uk). The AIC Code is available Viability Statement Company, and the level of remuneration | compliance with the AIC Code of Corporate | on the AIC website (www.theaic.co.uk) and | | | | --- | --- | --- | --- | | | | The Viability Statement can be found | of the Directors has been set in order to | | Governance (the “AIC Code”) and sets out | includes an explanation of how the AIC | | | | | | on page 55. | attract individuals of a calibre appropriate | | how the Board has operated during the | Code adapts the principles and provisions | | | to the future development of the Company. past year. The AIC Code, as published in set out in the UK Code to make them  February 2019, sets out principles and relevant for investment companies. A formal induction process has been The Board consists of six Non-Executive | provisions regarding matters including | | | established for new Directors which | | --- | --- | --- | --- | | | Throughout the year ended 31 May 2022, | Directors (four male and two female), | | | stakeholder engagement and the culture of | | | involves the provision of a full induction | | | the Company complied with the principles | and the Company has no employees. | | | the Company, against which the Company | | | pack containing relevant information | | | and provisions of the AIC Code which | The Board is responsible for all matters of | | | has reported in the Strategic Report. | | | about the Company. On appointment to | | | incorporates the UK Code. The Board | direction and control of the Company, and | | | The Company is committed to maintaining | | | the Board, Directors are fully briefed as to | | | attaches great importance to the matters | no one individual has unfettered powers | | | the highest standard of corporate | | | their responsibilities and are given the | | | set out in the UK Code and strives to apply | of decision. | | | governance and the Directors are | | | opportunity to talk to the relevant executive | its principals in a manner that would enable accountable to shareholders for the The Board seeks to ensure that it has the members of the Manager throughout their shareholders to evaluate how the principles governance of the Company’s affairs. appropriate balance of skills, experience,  have been applied. However, it should be ages and lengths of service among its  noted that where the principles and provisions The terms and conditions of the appointment members. The Directors possess a wide | | are related to the role of the Chief Executive, | | of the Non-Executive Directors are set out | | --- | --- | --- | --- | | This statement, together with the | |  | | | | Executive Directors’ remuneration and the | | in letters of appointment, copies of which | | Statement of Directors’ Responsibilities on | | relevant to the direction of the Company, | | | | establishment of a Remuneration Committee, | | are available for inspection at the registered | | page 142, indicates how the Company has | | and consider themselves as committing | | | | the Board considers these principles and | |  | | applied the principles of recommended | |  | | | | provisions not relevant as Pantheon | | at the AGM. None of the Directors has a | governance of the Financial Reporting International Plc is an externally managed contract of service with the Company. Brief biographical details of the Directors, Council’s (“FRC”) 2018 UK Corporate Company with an entirely Non-Executive including details of their other directorships Governance Code (the ‘UK Code’) and Further details on the Company’s purpose, Board, no employees or internal operations.  the AIC Code issued in 2019, which culture and values can be found in the found on pages 133 and 134. | complements the UK Corporate Governance |  | | Strategic Report on page 30. | | --- | --- | --- | --- | | Code and provides a framework of best | | The appointment of a new Director is | | | | The AIC Code is made up of 17 principles | |  | | practice for investment trusts. | | always made on the basis of a candidate’s | | | |  | |  |  The Board considers that reporting against – Board leadership and purpose; by the Board as being desirable to The Board has at least seven scheduled the principles and provisions of the AIC complement those of the existing meetings a year, and more if required. Code, which has been endorsed by the – Division of responsibilities; Directors. The Board acknowledges the Directors’ attendance at scheduled Board FRC, provides more relevant information to – Composition, succession and evaluation;  and Committee meetings held during the shareholders and that by reporting against | | | gender and ethnic diversity, and the Board | year to 31 May 2022 is set out on page 141 | | --- | --- | --- | --- | | the AIC Code the Company has met its | – Audit, risk and internal control; and | | | | | | remains committed to ensuring that the | below. | obligations in relation to the UK Code and – Remuneration. Governance Pantheon International Plc 140 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Statement on Corporate Governance  effectiveness. The resulting actions agreed Chair and Senior Independent Ms Mary Ann Sieghart was appointed Senior by the Directors will be monitored during  Independent Director of the Company at During the year, in order to review the  the conclusion of the Company’s AGM effectiveness of the Board as a whole, The Board appointed Sir Laurie Magnus in 2021. She provides a channel for any its Committees and individual Directors, As a result of the evaluation, the Board is CBE as Chair of the Company at the shareholder concerns regarding the an internal performance evaluation was  conclusion of the Company’s AGM in 2016. Chair and leads the Chair’s annual carried out by the Company Secretary. contribute effectively and have the skills Sir Laurie Magnus CBE is deemed by his performance evaluation. Led by the Senior Independent Director, the and experience relevant to the leadership fellow independent Board members to be evaluation was conducted using tailored and direction of the Company. independent. He considers himself to have  questionnaires structured to analyse   In accordance with the Listing Rules that Directors feedback on Board composition  apply to closed-ended investment entities, and effectiveness, the Board’s performance The Board has formalised arrangements other than those disclosed in his biography and taking into consideration the AIC Code, in relation to shareholder relations and under which the Directors, in the furtherance on page 133. Mr John Singer will succeed the Board has reviewed the status of its  of their duties, may take independent Sir Laurie Magnus CBE as Chair of the individual Directors and the Board as and Committee meetings, and to assess professional advice at the Company’s Company on his retirement from the a whole. | whether the operation of such meetings | expense. The Company has arranged a | Board at the conclusion of the Company’s | | | --- | --- | --- | --- | | was appropriate, as well as any additional |  | 2022 AGM. | All Directors are considered to be independent | | information that may be required to facilitate | policy which includes cover for legal | | in both character and judgement. | | better Board discussions. Responses | expenses. | | | were collated by the Company Secretary. The Company’s Articles of Association The independence of the Directors and take advantage of statutory provisions to   indemnify the Directors against certain the Company’s activities was considered Management liabilities owed to third parties even where as part of the evaluation process. The Audit Engagement Nomination such liability arises from conduct amounting Scheduled Committee Committee Committee performance of the Chair was similarly to negligence or breach of duty or of trust. Board meetings meetings meetings meetings evaluated by the other Directors. In addition, under the terms of appointment Sir Laurie Magnus CBE Following conclusion of the review, the of each Director, the Company has agreed, 1 S.E. Nicklin Company Secretary provided a report on subject to the restrictions and limitations the outcome of the evaluation, a summary imposed by statute and by the Company’s D.L. Melvin of strengths and areas for development and Articles of Association, to indemnify each J.D. Burgess feedback on how the Board could improve Director against all costs, expenses, losses in each area of assessment. The report and liabilities incurred in execution of his/her J.B.H.C.A. Singer from the Company Secretary was reviewed  M.A. Sieghart by the Nomination Committee as part of  Dame Sue Owen DCB its assessment of Board performance. provisions in the Company’s Articles of 2 Association and in the Directors’ terms T. Sakovska N/A N/A N/A The results of the evaluation process also of appointment, there are no qualifying indicated that the Board continues to work 1 Ms Nicklin retired from the Board on 27 October 2021. third-party indemnity provisions in force. 2 Ms Sakovska joined the Board on 1 March 2022 and resigned from the Board on 22 July 2022.  among the Directors about the Board’s Governance Pantheon International Plc 141 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Statement on Corporate Governance  The Board is responsible for the strategic to manage the assets of the Company in existing fund or a portfolio of secondary  and operational decisions of the Company accordance with the Company’s investment interests in existing funds and/or direct and for ensuring that the Company is run objectives and policies, subject to certain investments in one or more companies Following the Company’s inclusion in the in accordance with all regulatory and additional investment restrictions (which  FTSE 250 Index and in accordance with statutory requirements. These procedures may be amended by the Company from the Company at the time the investment the AIC Code, the Board has determined have been formalised in a schedule of time to time with the consent of the is made. that its policy on the tenure of the Chair | | matters reserved for decision by the full | Manager). The additional investment | | | --- | --- | --- | --- | | and the Directors is that the Chair | | | – The prior approval of the Board is | | | Board, which has been adopted for all | restrictions currently imposed on the | | | and all Directors will be subject to annual | | | required for a direct investment in a | | | meetings. These matters include: | Manager are as follows: | | | re-election at each AGM. Accordingly, | | |  | | resolutions to re-elect all applicable | – The maintenance of clear investment | – At the time of making an investment, the | asset value of the Company at the time | | Directors are contained within the 2022 | objectives, investment strategy and risk | aggregate of all amounts committed by | the investment is made. | | AGM Notice of Meeting. | management policies, changes to which | the Company in respect of investments | | The Manager has also agreed that it will require Board approval; (excluding all amounts paid pursuant to  obtain the prior approval of the Board in such commitments and including any relationship with the Manager – The monitoring of the business activities relation to any primary investment in a new such commitments in respect of the of the Company, including investment fund which is made otherwise than on a The Board is responsible for the investment to be made) shall not exceed performance and annual budgeting; and pro-rata basis with other Pantheon clients determination and implementation of  investing in the same fund and in relation the Company’s investment policy and – Review of matters delegated to the resources of the Company without the to any investment in a vehicle managed by for monitoring compliance with the Manager, Administrator or Company prior approval of the Board. a member of the Pantheon Group, other Company’s objectives. At each Board Secretary. – No direct or indirect investment in a than holding, special purpose and feeder meeting, the Directors follow a formal The management of the Company’s assets single company shall form more than vehicles where no fee is charged by the agenda to review the Company’s is delegated to Pantheon. At each Board  Pantheon Group. investments and all other important issues, meeting, representatives of Pantheon are at the time the investment is made. such as asset allocation, gearing policy, The Board determines the parameters of in attendance to present verbal and written corporate strategic issues, cash – The amount invested (including investment strategy and risk management reports covering its activities, the portfolio management, peer group performance, amounts committed for investment) in policies within which the Manager can and investment performance over the marketing and shareholder relations, respect of a single fund shall not exceed exercise judgement and sets the investment preceding period. Ongoing communication investment outlook and pacing, revenue  and risk management strategies in relation with the Board is maintained in between forecasts and outlook, to ensure that value of the Company and the aggregate to currency exposure. The Company formal meetings. The Manager ensures control is maintained over the Company’s outstanding investment commitments  that Directors have timely access to all affairs. The Board regularly considers its of the Company at the time the notes for Board consideration on matters  overall strategy and monitors the share investment is made. of relevance, for example changes to regulatory information to enable informed price and level of discount.  decisions to be made and contacts the – The prior approval of the Board is environment, statutory and regulatory  required for an investment (including changes and corporate governance particular issues. Pantheon has discretion investment commitments) in respect best practice. of a single secondary interest in an Governance Pantheon International Plc 142 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Statement on Corporate Governance  The Directors are able to impose limits  voting rights or conditions when giving authorisation Audit Committee Committee if they think this is appropriate in the The Company has delegated the exercise circumstances. A register of potential of its voting rights to the Manager. Pantheon  The Audit Committee comprises the The Management Engagement Committee has a policy of advising its clients to vote Secretary and is reviewed at each Board whole Board. Mr David Melvin, who is the comprises all the Directors and is chaired on all corporate actions in relation to meeting, to ensure that any authorised  by Sir Laurie Magnus. The Management investments and does this on behalf of  Chartered Accountant and contributes his Engagement Committee met on one the Company. Pantheon consults with the  knowledge and experience to the Audit occasion during the year under review. Directors of the Company in the case of whether there has been any change to Committee. It is felt by the Committee that any corporate action where either there is a The Board keeps the performance of the their position.   Manager under continual review. In addition, Chair of the Audit Committee. | Pantheon clients, or where for any reason | The Directors must also comply with | | in accordance with the requirements of the | | --- | --- | --- | --- | | the proposed voting is inconsistent with | the statutory rules requiring company | Sir Laurie Magnus CBE has over 40 years | AIC Code, the Management Engagement | | the advice given to Pantheon’s other clients. | directors to declare any interest in an | of investment banking experience, and it | Committee reviews the performance | | | actual or proposed transaction or | is considered appropriate for the Chair | of the Manager’s obligations under the |  arrangement with the Company. of the Company to be a member of the Management Agreement and considers The Articles of Association permit the Audit Committee as he provides a valuable the need for any variation to the terms of The above process for authorising potential  contribution to the deliberations of the this Agreement on an annual basis.  authorise situations where a Director has Committee. effectively during the year. The Management Engagement Committee  | | | The Audit Committee met on three | then makes a recommendation to the | | --- | --- | --- | --- | |  |  | | | | | | occasions during the year ended 31 May | Board about the continuing appointment | There is in place a formal system for the The Board has appointed a number of 2022. It is intended that the Committee of the Manager under the terms of the Board to consider authorising such Committees, as set out below, to which will continue to meet at least three times Management Agreement.  certain Board functions have been a year, to review the Half-Yearly Report, to no interest in the matter decide whether to The Management Engagement Committee delegated. Each of these Committees has review the year-end valuation of investments  also reviews annually the performance of formal written terms of reference which and to approve the Company’s Annual to be attached to such authorisations. the Company Secretary, the Custodian,  Report and Accounts. The process in place for authorising the Depository and the Registrar and these can be inspected at the registered  The Report of the Audit Committee can be any matters concerning their respective  effectively during the year. found on pages 147 to 149. agreements with the Company. Company’s website (www.piplc.com). Governance Pantheon International Plc 143 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Statement on Corporate Governance to a formal, rigorous and transparent As a consequence of Ms Sakovska’s  procedure. The Company seeks to ensure departure, the Committee will seek to services professional with over 30 years’ Nomination Committee | |  | engage an external search consultant to | experience in private equity. He spent over | | --- | --- | --- | --- | | |  |  | 20 years with Advent International plc | | The Nomination Committee comprises | objective criteria and merit and in the | into account the results of the recent | as co-founder of the Global Executive | | all Directors and is chaired by Sir Laurie | context of the skills, knowledge and | Board evaluation. | Committee and, until 2012, as Chairman of | | Magnus CBE, except when considering | experience that are needed for the Board | | European operations. He was Managing | On 9 June 2022, the Board announced succession of the Chair. to be effective. The Board supports Director and founder of Granville Europe that its Chair, Sir Laurie Magnus CBE, diversity and inclusion at Board level  The role of the Nomination Committee is to would be retiring as Director of the and encourages candidates from all equity funds. In addition, he was Chairman undertake the formal process of reviewing Company following the conclusion of the educational backgrounds and walks of life. of the European Venture Capital Association. the balance, effectiveness and diversity Annual General Meeting scheduled for He is involved with several organisations in of the Board and considers succession During the year, the Nomination Committee October 2022, and that Mr John Singer the arts and education sectors. Further planning, identifying the skills and expertise reviewed PIP’s Diversity Policy as well as would be assuming the role as Chair. One details of Mr Singer’s skills and experience needed to meet the future challenges and the balance of skills and diversity on the of the main focuses for the Nomination can be found on page 134. | opportunities facing the Company and | Board. As part of ongoing succession | Committee throughout the year was to | | | --- | --- | --- | --- | | those individuals who might best provide | planning, Cornforth Consulting Ltd, an | ensure an orderly succession of Sir Laurie | The Board acknowledges and welcomes | | them. The Nomination Committee, as and | independent external consultancy with no | Magnus CBE as Chair of the Board. | the recommendations from the | | when necessary, makes recommendations | connection to the Company, was engaged | During the meetings of the Nomination | Hampton-Alexander Review on gender | | to the Board with regard to the criteria | to assist with the search for candidates. | Committee where the Chair’s succession | diversity on boards and the Parker Review | | for future Board appointments and the | The search requirements included a | was discussed, the Senior Independent | regarding ethnic representation on | | methods of selection. It also considers | preference for candidates with a strong | Director (“SID”), Ms Mary Ann Sieghart, | boards. The Hampton-Alexander Review | | and reviews the appointment of a Senior | background in private equity, governance | chaired the meetings. |  | | Independent Director, membership | and diversity. Following this process, the | | representation on all FTSE 350 companies | During the selection process led by the SID, of the Board’s Committees, and the Nomination Committee recommended to by the end of 2025. PIP exceeded this the Board reviewed the characteristics re-appointment of those Directors the Board the appointment of Ms Tamara recommendation during the year and had and experience which it considered to be standing for re-election at AGMs. Sakovska, and after due consideration  important for the Chair to possess and | | she was appointed to the Board, being | | 2022. In regard to the Parker Review, it is | | --- | --- | --- | --- | | In addition, the Nomination Committee | | concluded that Mr Singer’s extensive | | | | the strongest candidate with relevant | | recommended that by December 2024 | | is responsible for assessing the time | | experience in private equity and investment | | | | knowledge and experience. | | all FTSE 350 companies have a person | | commitment required for each Board | | trusts at the highest levels as well as his | | from a minority ethnic group on its Board. appointment and ensuring that the present As reported on page 21, Ms Sakovska detailed knowledge of both the Board and While all appointments to the Board will  joined the Board on 1 March 2022, a role the Company’s Investment Manager, be made on merit, the Board supports undertake them, and for reviewing the that she accepted before the onset of the Pantheon, made him a strong and well the recommendation to have ethnic Directors’ performance appraisal process.   representation on the Board, and as such voluntary relief efforts meant that she had as Chair. considers this integral to the Board’s As part of ongoing succession planning,  Following the Nomination Committee’s succession planning. the Nomination Committee ensures that a Director of PIP. Ms Sakovska resigned as all Board appointments are subject recommendation, the Board approved a Director of the Company on 22 July 2022. Further information regarding diversity and Mr John Singer’s appointment as Chair inclusion at Pantheon can be found on with effect from the conclusion of the page 39. 2022 Annual General Meeting. Governance Pantheon International Plc 144 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Statement on Corporate Governance  – The Company’s ability to reduce the Other than the matter referred to in the place throughout the year and up to the incidence and impact of risk on its Audit Committee Report, there were no Remuneration Committee  performance;  approved. Full details of the principal risks in the Board’s review of the internal –  As the Company has no employees and the and uncertainties faced by the Company controls of its third-party suppliers. related to the review of risk and associated Board is composed solely of Non-Executive can be found on pages 46 to 49. The key procedures which have been controls of the Company; and Directors, it is not considered necessary to established to provide effective internal The risk management process and have a Remuneration Committee. Led by – The extent to which third parties operate  systems of internal control are designed to the Senior Independent Director, it is the the relevant controls. Against this manage, rather than eliminate, the risk of – Investment management is provided by responsibility of the Board as a whole to background, the Board has split the failure to achieve the Company’s objectives. Pantheon Ventures (UK) LLP. The Board determine and approve Directors’ fees,  It should be recognised that such systems is responsible for the implementation following proper consideration and having nature of the risks being addressed. can only provide reasonable, rather than of the overall investment policy and regard to the industry generally, the role absolute, assurance against material The sections are as follows: monitors the actions of the Manager  misstatement or loss. at regular Board meetings. Board and Committee responsibilities, the – Corporate strategy; time committed to the Company’s affairs  – BNP Paribas Trust Corporation UK – Published information and compliance and remuneration levels generally within Limited (previously BNP Paribas Regular risk assessments and reviews of with laws and regulations; the investment trust sector. Each Director Securities Services, London Branch) has internal controls and the Company’s risk takes no part in discussions concerning – Relationship with service providers; and been appointed as Depositary. Custody appetite are undertaken by the Board their own remuneration. of assets is also undertaken by BNP in the context of the Company’s overall – Investment and business activities. Paribas Trust Corporation UK Limited as Detailed information on the remuneration investment objective. The Board, through the Company’s Custodian for equities Given the nature of the Company’s arrangements for the Directors of the delegation to the Audit Committee, has and bonds. activities and the fact that most functions Company can be found in the Directors’ undertaken a robust assessment and are sub-contracted, the Directors have Remuneration Report on pages 150 to 152. review of the emerging and principal risks – The provision of administration, obtained information from key third-party facing the Company. The review covers accounting and Company secretarial  suppliers regarding the controls operated the key business, operational, compliance duties is the responsibility of Link by them. To enable the Board to make an The Directors acknowledge that they are  Alternative Fund Administrators Limited. appropriate risk and control assessment, responsible for the Company’s risk In arriving at its judgement of what risks the information and assurances sought – The provision of services provided by management and systems of internal the Company faces, the Board has from third parties include the following: Link Market Services as Registrar of control and for reviewing their effectiveness. considered the Company’s operations the Company. in the light of the following factors: – Details of the control environment; An ongoing process, in accordance with – The duties of investment management, the guidance provided by the FRC on risk – The nature and extent of risks which –  accounting and custody of assets are management, internal control and related it regards as acceptable for the and control objectives; segregated. The procedures of the  Company to bear within its overall individual parties are designed to business objective; – Assessment of the communication established for identifying, evaluating and complement one another. procedures; and managing risks faced by the Company. – The threat of such risks becoming This process, together with key procedures a reality; – Assessment of the control procedures established with a view to providing operated. Governance Pantheon International Plc 145 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Statement on Corporate Governance – The Directors of the Company clearly  the Company’s shareholders is reviewed  at each Board meeting. PIP has also The Board has direct access to the advice their agents and advisers in the terms recently put in place a new PR programme and services of the Company Secretary, of their contracts. The appointment of  Link Alternative Fund Administrators agents and advisers is conducted by the provide to a retail investor’s portfolio. Limited, who is responsible for ensuring Board after consideration of the quality that Board and Committee procedures are The Half-Yearly and Annual Reports of of the parties involved; the Board, via the followed and that applicable regulations the Company are prepared by the Board Management Engagement Committee, are complied with. and its advisers to present a full and monitors their ongoing performance readily understandable review of the and contractual arrangements. The Company Secretary is also responsible Company’s performance. to the Board for ensuring the timely delivery – Mandates for authorisation of of information and reports and for ensuring Copies are dispatched to shareholders by investment transactions and expense that statutory obligations of the Company mail or electronically as requested and are payments are set by the Board. are met. also available on the Company’s website: –  www.piplc.com. The Company always Dialogue with shareholders information produced by the Manager responds to communications from and the Administrator on a regular basis. Communication with shareholders is shareholders. Shareholders wishing to given a high priority by the Board and the communicate directly with the Board The Company does not have an internal Manager, and all Directors are available should contact the Company Secretary audit function. All of the Company’s to enter into dialogue with shareholders. by email to pip_cosec@linkgroup.co.uk or management functions are delegated to All shareholders are encouraged to attend  independent third parties whose controls and vote at the AGM, during which the on page 199, who will arrange for the are reviewed by the Board. It is therefore Board and the Manager are available to relevant Board member to contact them. felt that there is no need for the Company discuss issues affecting the Company, to have an internal audit function. Further details of our engagement with all and shareholders have the opportunity This need is reviewed periodically. of the Company’s stakeholders and how to address questions to the Manager, the Board has regard to those stakeholders In accordance with guidance issued the Board and the Chairs of the Board’s in the Board’s decision-making processes to directors of listed companies, the Committees. At each AGM, a presentation are set out in the Strategic Report on Directors have carried out a review of the is given by the Manager to all shareholders pages 50 to 54. effectiveness of the various systems present. of internal controls as operated by the On behalf of the Board There is regular dialogue with institutional Company’s main service providers during shareholders and a structured programme   the year and found there to be no matters Chair of shareholder presentations by the of concern. Manager to institutional investors taking 3 August 2022 place following publication of the Annual and Half-Yearly results. A detailed list of Governance Pantheon International Plc 146 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Audit Committee Report | I am pleased to present the Audit Committee | – To make recommendations to the Board | – Reviewed the impact of a disrupted | The Audit Committee has received | | --- | --- | --- | --- | | Report for the year ended 31 May 2022. | in relation to the re-appointment of the | recovery in the wake of the COVID-19 | reassurances about the robustness | | | Auditor and to approve the Auditor’s | pandemic, geopolitical uncertainties as | of the Manager’s valuation system | The Audit Committee comprises myself, remuneration and terms of engagement,  from Pantheon. as Chair, and the entire Board. including scope of work; including the disruption to the global In addition, the Audit Committee reviewed | Further details about the composition | | supply chain, increases in the cost of | | | --- | --- | --- | --- | | | – To review and monitor the Auditor’s | | the outputs of Pantheon’s Investment | | of the Audit Committee are set out on | |  | | | | independence and objectivity and the | | Valuation Committee and Pantheon’s | | page 143. | | rises and the impact of climate change | | | | effectiveness of the audit process; and | | processes and internal controls around |  Audit Committee members consider the investment valuation process. – To provide a forum through which the that, individually and collectively, they – Reviewed the internal controls and Company’s Auditor reports to the Board.  are each independent and appropriately risk management systems (including  The Audit Committee also reviews the cybersecurity) of the Company and As an investor in private equity, the Company the sector in which the Company operates. Manager’s whistleblowing procedures its third-party service providers; has outstanding commitments to fund The constitution and performance of  The Audit Committee has direct access – Agreed the audit plan and fees with the the Audit Committee is reviewed on a uncalled commitments relate to funds to the Company’s Auditor, Ernst & Young Auditor, including the principal areas regular basis. that are outside their investment periods. (“EY”), and representatives of EY attend of focus; Generally, when a fund is past its investment Role of the Audit Committee each Audit Committee meeting. – Reviewed the whistleblowing policy of    the Manager (no incidents were reported and six years, it cannot make any new were reviewed and updated during the during the period); and investments and only draws capital to fund We met on three occasions during the year | year, have been established by the Board. | | | follow-on investments into existing portfolio | | --- | --- | --- | --- | | | ended 31 May 2022. At those meetings, | – Reviewed its own performance as a | | | The primary responsibilities of the Audit | | | companies, or to pay expenses. As a result, | | | the Audit Committee has: | Committee and its own terms of | | | Committee are: | | | the rate of capital calls by these funds | reference. – Reviewed and agreed the half year and tends to slow dramatically. During the year, –  year end portfolio valuation and the net The principal issues considered by the the Manager undertook a detailed process  asset values; Committee were as follows: to review the undrawn commitments, and process and the accounting policies the results were discussed with the Audit of the Company; –   Committee. The Audit Committee received statements for the half year and year end of assets – To review the effectiveness of the assurances from Pantheon about the and made formal recommendations to internal control environment of the Discussions have been held with the systems and controls in place to track the Board; Company and its reporting processes Manager about the valuation process, the undrawn commitments as part of the and to monitor adherence to best ownership of assets and the systems in valuation entry process. – Reviewed the Company’s going concern practice in corporate governance; and viability statements; place at Pantheon to ensure the accuracy The Audit Committee also reviewed the of the valuation of the Company’s portfolio. level of undrawn commitments as part of its analysis of PIP’s going concern and long-term viability. Governance Pantheon International Plc 147 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Audit Committee Report |  |  | Audit fees |  | | --- | --- | --- | --- | | The Committee considered the Company’s | The Audit Committee has reviewed and | The audit fee incurred for the review of | The Audit Committee meets at least twice | |  | updated, where appropriate, the Company’s | the 2022 Annual Report and Audit was | a year with the Auditor. The Auditor | | forthcoming year taking into account the | risk matrix. This document is reviewed by | £105,000 (31 May 2021: £105,000). | provides a planning report in advance of | |  | the Audit Committee every six months. | The Audit Committee continues to | the annual audit, a report on the annual | | position as at 31 May 2022. Its assessment |  | monitor the level of audit fees carefully. | audit and a report on their review of the | | included a review of various downside | quality of the reporting of the Manager’s | |  |  liquidity models with varying degrees of monitoring to enable the Audit Committee Committee has an opportunity to question  | decline in investment valuations, a review | to assess the degree of control of the | | and challenge the Auditor in respect of | | --- | --- | --- | --- | | of the level of undrawn commitments, | Company and the effect with which risk | The Audit Committee reviews the scope | each of these reports. In addition, at least | | the longer term impact of the COVID-19 | is managed and mitigated. The Audit | and nature of all proposed non-audit | once a year, the Audit Committee has an | | pandemic, ongoing geopolitical uncertainties | Committee has received reports on internal | services before engagement, to ensure | opportunity to discuss any aspect of the | |  | controls from each of its service providers. | that the independence and objectivity of | Auditor’s work with the Auditor in the | | and the impact of climate change on | | the Auditor are safeguarded. The Board’s | absence of the Manager. After each audit, |   policy is that non-audit services may be the Audit Committee reviews the audit  those relating to principal risks. As a result carried out by the Company’s Auditor process and considers its effectiveness. the year ended 31 May 2022, within the | of this assessment, the Committee | |  | | | --- | --- | --- | --- | | | Company or its third-party suppliers. | | Continuing appointment of the Auditor | | concluded that the Company had adequate | | someone else is considered to have | | | resources to continue in operation and | The Company does not have an internal | more relevant experience. | EY was appointed as the Company’s | | meet its liabilities as they fall due both | audit function as substantially all of its | | Auditor at the AGM in 2019 and this is | Non-audit services amounting to £35,000 for the forthcoming year and over the day-to-day operations are delegated to therefore the third audit of the Company’s were provided during the year ended subsequent two years. Related going third parties, all of whom have their own  31 May 2022 (31 May 2021: £35,000), | concern and long-term viability disclosures | internal control procedures. The Audit | | | | --- | --- | --- | --- | | | | relating to the review of the half year and | A competitive tender must be carried out | | are set out on pages 137 and 55 and Note 1 | Committee discussed whether it would be | | | | | | year end net asset value calculations | by the Company at least every ten years. | | on page 167. | appropriate to establish an internal audit | | | | | | and the review of the Half-Yearly Report. | The Company is therefore required to | function, and agreed that the existing   carry out a tender no later than in respect system of monitoring and reporting by third status The Audit Committee believes that it is   appropriate for the Company’s Auditor to 2029. The current lead audit partner, The Manager and Administrator  provide these services to the Company as Mr Matthew Price, has been in place since have reported to the Committee to these services are audit-related. the appointment in 2019. Ethical standards  The Audit Committee monitors and generally require the rotation of the requirements for maintaining investment reviews the effectiveness of the external The Audit Committee has received  trust status. The position is also discussed audit process for the publication of the assurances from the Auditor that its a listed client. with the Auditor as part of the audit process. Annual Report and makes recommendations independence is not compromised to the Board on the re-appointment, by the supply of these services. remuneration and terms of engagement of the Auditor. Governance Pantheon International Plc 148 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Audit Committee Report The Committee monitors the Company’s The Committee has considered the CMA Order relationship with the Auditor and has  The Company complied throughout the discussed and considered their independence  year ended 31 May 2022 with the provisions and objectivity. The Auditor also provides statements for the year. The feedback of the Statutory Audit Services Order 2014,  provided by the Investment Manager issued by the Competition and Markets within the meaning of all regulatory and regarding the audit team’s performance Authority (“CMA Order”). professional requirements and that on the audit was positive. The Auditor objectivity of the audit is not impaired. demonstrated a good understanding of    As a result of the work performed, the Audit EY was independent, especially considering  Committee has concluded that the Annual the term of appointment to date, and will reporting risk. Its reporting to the Audit Report for the year ended 31 May 2022, continue to monitor this position. Committee was clear, open and thorough. taken as a whole, is fair, balanced and  Following the completion of the audit, the understandable and provides the information Auditor has demonstrated professional Committee reviewed EY’s effectiveness by: necessary for shareholders to assess the skepticism and appropriately challenged Company’s position and performance, – Reviewing the overall audit process and management’s judgements relating to business model and strategy, and has the audit procedures taken to address the valuations of unlisted investments.   The Committee acknowledged that the audit team, including the audit partner,  – Considering feedback on the audit comprised staff with appropriate levels Audit Committee Chairman provided by the Investment Manager of knowledge and experience of the and Link Group; 3 August 2022 investment trust and private equity sectors. – Reviewing feedback on the audit On the basis of these factors and provided by the Investment Manager assessments, the Committee has and Link Group; and concluded that the external audit process – Reviewing the experience and continuity has been effective. Taking into account of the audit team, including the audit the performance and effectiveness of partner.  their independence, the Committee has recommended to the Board that a resolution to re-appoint EY as Auditor be put to shareholders at the forthcoming   Governance Pantheon International Plc 149 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Directors’ Remuneration Report A resolution to approve the Remuneration In accordance with PIP’s Remuneration An ordinary resolution will be proposed ### The Board has prepared this | | Policy was proposed and approved by | Policy, from 1 June 2021, fees for the | at the 2022 AGM to approve an updated | | --- | --- | --- | --- | | report in accordance with the | shareholders at the AGM of the Company | Directors were increased annually, effective | Directors’ Remuneration Policy (the | | | held on 27 October 2021. |  | “Updated Policy”). During the year, the | ### requirements of the Large and  Chair’s fee was reviewed against a The Board consists entirely of ### Medium Sized Companies Price Index (“CPI”) prevailing at the time. selection of companies from the Non-Executive Directors and the Company | | | However, for the 12 months to 31 May | Company’s peer group, by an external | | --- | --- | --- | --- | | and Groups (Accounts and | has no employees. We have not, therefore, | | | | | |  | remuneration advisor, Cornforth | reported on those aspects of remuneration ### Reports) (Amendment)  Consulting. As a result of this review, the that relate to Executive Directors. the Board is proposing an amendment to fee for the Chair is proposed to be set at ### Regulations 2013. As explained on page 145, it is not PIP’s Remuneration Policy to allow the £80,000 per annum from the conclusion of considered appropriate for the Company Directors discretion to determine the the 2022 AGM. The law requires the Company’s Auditor to | | to establish a separate Remuneration | annual increase to Directors’ fees at a rate | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | audit certain disclosures provided. Where | | | | | | | | |  | | | Committee. It is therefore the practice | which is less than the rate of CPI prevailing | | | | | | | | | disclosures have been audited, they are | | | | | | | | | and responsibilities of the role of the Senior | | | for the Board as a whole to consider and | at the annual review date so that they | | | | | | | | | indicated as such. The Auditor’s opinion | | | | | | | | | Independent Director, the fee for the SID is | | | approve Directors’ remuneration. |  | | | | | | | | | is included in the “Independent Auditor’s | | | | | | | | | proposed to be set at £47,721 per annum | | Report” on pages 154 to 161. | | | | | | | | | from the conclusion of the 2022 AGM. | | |  | | | | | |  | | | | Statement from the Chair | | | | Year to | | | Year to | | Therefore, subject to shareholder approval | | | | | 31 May 2022 | | | 31 May 2021 | | | of the Updated Policy, Directors’ fees for | | I am pleased to present the Directors’ | | | | | £ | | | £ | | the 12 months to 31 May 2023 are as set Remuneration Report for the year ended Sir Laurie Magnus CBE (Chair) 66,365 65,000 out on page 152. 31 May 2022. 1 S.E. Nicklin 17,016 40,000 No travel expenses or any other expenses Companies are required to ask were claimed by the Directors from the D.L. Melvin 53,603 52,500 shareholders to approve the annual Company during the year ended 31 May remuneration report, which includes the J.B.H.C.A. Singer 40,840 40,000 2022 or as at the date of this Report. annual remuneration paid to Directors, J.D. Burgess 40,840 40,000 each year and formally to approve the M.A. Sieghart 40,840 40,000 Directors’ Remuneration Policy on a | three-yearly basis. Any change to the | Dame Sue Owen DCB 40,840 40,000 | | | | --- | --- | --- | --- | | Directors’ Remuneration Policy requires | | 2 | | | | T. Sakovska | | 10,210 – | shareholder approval. The vote on the 3 I.C.S. Barby – 13,334 Directors’ Remuneration Report is, as previously, an advisory vote, while the Total 310,554 330,834 Directors’ Remuneration Policy is subject 1 Ms Nicklin retired from the Board on 27 October 2021. to a binding vote. 2 Ms Sakovska joined the Board on 1 March 2022 and subsequently resigned on 22 July 2022. 3 Mr Barby retired from the Board on 22 September 2020. Governance Pantheon International Plc 150 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Directors’ Remuneration Report  Return (Sterling) Index. These indices have  remuneration paid to Directors, the been selected as the most relevant, as Management fee and share buybacks The graph below shows the total return The table below sets out, in respect of the there is no listed index that is directly and the percentage change between the to shareholders compared to the total  comparable with the Company’s portfolio. two periods: shareholder returns of the FTSE All-Share  Total Return Index and MSCI World Total | | Year to | | Year to | | | | --- | --- | --- | --- | --- | --- | | 31 May 2022 | | 31 May 2021 | | Change | | | | £’000 | | £’000 | |  | Total remuneration paid to Directors 311 331 (6) Management fee 23,115 18,544 25 Share buybacks 10,302 Nil – 600%  The interests of the Directors and any persons closely associated in the shares There is no requirement under the of the Company are set out below: 450% Company’s Articles of Association or the terms of their appointment for Directors to hold shares in the Company. * 300% 31 May 2022 31 May 2021 Sir Laurie Magnus (Chair) 143,240 14,324 1 | 750% | | D.L. Melvin | | 105,000 10,000 | | --- | --- | --- | --- | --- | | | 150% | | 2 | | | | | J.D. Burgess | | 1,930,630 193,063 | J.B.H.C.A. Singer 399,820 39,982 M.A. Sieghart 37,250 2,725 0% Dame Sue Owen DCB 17,50 0 820 T Sakovska 1,557 – 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 *  PIP FINANCIAL YEAR    The Directors’ Remuneration Policy PIP ordinary share price FTSE All-Share Total Return 1 Held jointly with spouse. and Remuneration Report for the year MSCI World Total Return (Sterling) 2 Includes 1,530,810 shares held by The November 1990 Trust, a connected person. ended 31 May 2022 were approved by shareholders at the AGM held on There has been no change to the above 27 October 2021. interests between 31 May 2022 and the date of this report. Governance Pantheon International Plc 151 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Directors’ Remuneration Report | The votes cast by proxy were as follows: | determined with reference to comparable | ending 31 May 2023 with effect from the |  | | --- | --- | --- | --- | | | organisations and appointments. The level | Updated Policy being approved by | | | Remuneration Report | | | None of the Directors has a contract of | | | of remuneration has been set in order to | shareholders at the AGM on 18 October | | service with the Company. Each Director has | Number | |  | attract individuals of a calibre appropriate | 2022. In addition, the Board proposes that | | | --- | --- | --- | --- | --- | --- | | of votes | votes cast | | | | entered into terms of appointment as a | | | | | to the future development of the Company | fees for the Chair and the Senior | | Non-Executive Director of the Company. For 30,663,119 99.98  Independent Director will be set at the rates There has been no other contract or the Company, the duties and responsibilities described on page 150 and set out in the Against 5,850 0.02 arrangement between the Company and any of the Directors, and the value and amount table below with effect from the Updated At Chair’s Director at any time during the year. Under of time committed to the Company’s affairs. Policy being approved by shareholders at discretion _ _ the Articles of Association, each Director the AGM on 18 October 2022. There are no performance conditions shall retire and be subject to re-appointment Total votes cast 30,668,969 100.00 attaching to the remuneration of the The Chair does not participate in any  Number of Directors as the Board does not believe discussions relating to his own fee, which at least every three years thereafter. After votes withheld 14,946 – that this is appropriate for Non-Executive is determined by the other Directors. nine years’ service, Directors are subject to Directors. The Directors do not receive annual re-appointment. Following the Directors are entitled to be paid all   Company’s inclusion in the FTSE 250, and in travelling, hotel or other expenses properly Number  schemes or share options. accordance with the AIC Code, all Directors incurred by them in connection with their of votes votes cast are subject to annual re-election at each All Directors act in a non-executive capacity, attendance at Director or shareholder AGM. There are no agreements between the For 30,660,924 99.97 meetings or otherwise in connection with and the fees for their services are approved Company and its Directors concerning Against 7,945 0.03 by the whole Board. The fees for the Directors the discharge of their duties as Directors.  are determined within the limits set out in At Chair’s Year to Annual fee for the Annual fee for the the Company’s Articles of Association, or discretion – – 31 May 2022 Increase period 01 June 2022 period 19 October any greater sum that may be determined £ percentages to 18 October 2022 2022 to 31 May 2023 Total votes cast 30,668,869 100.00 by ordinary resolution of the Company. Chair 66,365 9.1 72,404 80,000 Number of Since 1 June 2021, fees for the Directors votes withheld 15,046 – Chair of the Audit Committee 53,603 9.1 58,481 55,747 are increased annually, effective from the Senior Independent Director 40,840 9.1 44,556 47,721   | | by the rate of CPI prevailing at that time. | Other Directors 40,840 9.1 44,556 42,474 | | | --- | --- | --- | --- | | The Directors’ Remuneration Policy | Subject to shareholders approving the | | | | | Updated Policy (as described on page 150), | No other additional fees are payable for | Any views expressed by shareholders on | (the “Policy”) is put to shareholders’ vote from the conclusion of the 2022 AGM and membership of the Board’s committees. the fees being paid to Directors would be at least once every three years and in any  taken into consideration by the Board. year if there is to be a change in the Policy. Fees for any new Director appointed will A resolution to approve the Policy was year thereafter, fees for the Directors will be Approval be made on the above basis. Fees payable approved by shareholders at the AGM set at a rate no greater than the rate of CPI in respect of subsequent years will be The Directors’ Remuneration Report was held on 27 October 2021. prevailing at the time, with any lower rate determined following an annual CPI review, approved by the Board of Directors and being determined at the discretion of the with additional market reviews taking  signed on its behalf by: Board. The Board proposes that such lower place as appropriate to ensure fees The Board’s policy is that remuneration of    remain appropriate.   Chair experience of the Board as a whole and is 3 August 2022 Governance Pantheon International Plc 152 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Directors’ Responsibility Statement | The Directors are responsible for preparing | – State whether applicable UK Accounting | for the maintenance and integrity of the | which the Audit Committee has reached | | --- | --- | --- | --- | |  | Standards have been followed, subject |  | these conclusions is set out in its report on | | statements in accordance with applicable | to any material departures disclosed and | information included on the Company’s | pages 147 to 149. As a result, the Board | | laws and regulations in accordance |  | website (www.piplc.com). Legislation | has concluded that the Annual Report and | | with FRS102. Company law requires the | and | in the UK governing the preparation and |  | |  | |  | 31 May 2022, taken as a whole, is fair, | –   differ from legislation in other jurisdictions. balanced and understandable and provides a going concern basis unless it is  the information necessary for shareholders inappropriate to presume that the Each of the Directors, whose names are statements in accordance with applicable to assess the Company’s position and Company will continue in business.  law and UK Accounting Standards (UK performance, business model and strategy. the best of their knowledge: Generally Accepted Accounting Practice). The Directors are responsible for keeping Signed on behalf of the Board by Under company law the Directors must not adequate accounting records that are –    accordance with applicable accounting    Company’s transactions and disclose standards, give a true and fair view of the Chair and fair view of the state of affairs of the with reasonable accuracy at any time the  3 August 2022      – The Strategic Report contained in the Company for that period. statements comply with the Companies  Act 2006. They are also responsible for  includes a fair review of the development safeguarding the assets of the Company the Directors are required to: and performance of the business and and hence for taking reasonable steps for the position of the Company, together – Present a true and fair view of the the prevention and detection of fraud and with a description of the principal risks  other irregularities. and uncertainties that it faces.  The Directors are also responsible for The UK Corporate Governance Code requires – Select suitable accounting policies in preparing the Strategic Report, the Directors’ Directors to ensure that the Annual Report accordance with United Kingdom GAAP Report, the Directors’ Remuneration Report,  and then apply them consistently; the Corporate Governance Statement and and understandable. In order to reach a the Report of the Audit Committee in – Present information, including conclusion on this matter, the Board has accordance with the Companies Act 2006 accounting policies, in a manner that requested that the Audit Committee and applicable regulations, including the provides relevant, reliable, comparable advises on whether it considers that the requirements of the Listing Rules and the and understandable information;  Disclosure Guidance and Transparency  – Make judgements and estimates that Rules. The Directors have delegated are reasonable and prudent; responsibility to the Investment Manager Governance Pantheon International Plc 153 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Independent Auditor’s Report to the Members of Pantheon International Plc Opinion We believe that the audit evidence we have – We inspected the Directors’ assessment – We considered the mitigating factors  of going concern, including the portfolio   provide a basis for our opinion.  forecasts and covenant calculations that of Pantheon International plc (the “Company”) 31 May 2027 which is at least twelve are within the control of the Company. for the year ended 31 May 2022 which   | comprise the Income Statement, the | | | – We reviewed the Company’s going | | --- | --- | --- | --- | | | We are independent of the Company in | statements were authorised for issue. | | | Statement of Changes in Equity, the Balance | | | concern disclosures included in the | | | accordance with the ethical requirements |  | | | Sheet, the Cash Flow Statement, and the | | | annual report in order to assess that the | | |  | forecast, the Company has concluded | | | related notes 1 to 22 including a summary | | | disclosures were appropriate and in | | | statements in the UK, including the | that it is able to continue to meet its | | |  | | | conformity with the reporting standards. | | | Financial Reporting Council’s Ethical | ongoing costs as they fall due. | |  | | Standard as applied to public interest | | Based on the work we have performed, | | --- | --- | --- | --- | | has been applied in their preparation is | | – We have reviewed the factors and | | | |  | |  | | applicable law and United Kingdom | | assumptions, including the impact | | | | ethical responsibilities in accordance with | | uncertainties relating to events or | | Accounting Standards including FRS 102 | | of the COVID-19 pandemic, as applied | | | | these requirements. | | conditions that, individually or collectively, | | “The Financial Reporting Standard | |  | |  applicable in the UK and Republic of The non-audit services prohibited by the liquidity assessment of the Company’s ability to continue as a going Ireland” (United Kingdom Generally the FRC’s Ethical Standard were not investment portfolio. We considered the concern for the period to 3 August 2023. Accepted Accounting Practice). provided to the Company and we remain appropriateness of the methods used to independent of Company in conducting  In relation to the Company’s reporting on  the audit. and the liquidity assessment and how they have applied the UK Corporate – give a true and fair view of the Company’s determined, through testing of the Governance Code, we have nothing   methodology and calculations, that material to add or draw attention to in  for the year then ended; the methods, inputs and assumptions relation to the directors’ statement in  utilised were appropriate to be able to  – have been properly prepared in accordance have concluded that the directors’ use of make an assessment for the Company. the directors considered it appropriate with United Kingdom Generally Accepted the going concern basis of accounting in to adopt the going concern basis Accounting Practice; and – In relation to the Company’s borrowing  of accounting. arrangements, we inspected the | – have been prepared in accordance with | is appropriate. Our evaluation of the | | | | --- | --- | --- | --- | | | | Directors’ assessment of the risk of | Our responsibilities and the responsibilities | | the requirements of the Companies Act | directors’ assessment of the Company’s | | | | | | breaching the loan facility covenants as | of the directors with respect to going | | 2006. | ability to continue to adopt the going | | | | | | a result of a reduction in the value of the | concern are described in the relevant | concern basis of accounting included: Company’s portfolio. We recalculated sections of this report. However, because  –  the Company’s compliance with loan not all future events or conditions can be We conducted our audit in accordance with facility covenants in the scenarios Company’s going concern assessment predicted, this statement is not a guarantee International Standards on Auditing (UK) assessed by the Directors who also process and engaged with the Directors as to the Company’s ability to continue (ISAs (UK)) and applicable law. Our performed reverse stress testing in and the Company Secretary to determine as a going concern. responsibilities under those standards order to identify what factors would if all key factors were considered in their are further described in the Auditor’s lead to the Company breaching the assessment. responsibilities for the audit of the   Governance Pantheon International Plc 154 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Independent Auditor’s Report to the Members of Pantheon International Plc  Our audit effort in considering climate change was focused on the adequacy of Key audit – Risk of incorrect valuation of unlisted investments at fair value.  matters statements as set out in note 1 and – Incorrect valuation of investments in third party managed funds and co-investment vehicles which are audited on an annual basis and for which conclusion that there was no material periodic fair value information is provided to the Company. impact from climate change on the  – Incorrect valuation of investments in co-investment vehicles or third-party funds which are not audited on an annual basis. the Directors’ considerations of climate change in their assessment of viability – Incorrect valuations of investments in funds and entities managed by and associated disclosures. Pantheon Ventures (UK) LLP (‘Pantheon’). Key audit matters Materiality –  Key audit matters are those matters that, in our professional judgment, were of most    statements of the current period and  There has been increasing interest from  stakeholders as to how climate change will Our assessment of audit risk, our risks of material misstatement (whether impact companies. The Company has evaluation of materiality and our allocation   of performance materiality determine our These matters included those which had future impacts from climate change on audit scope for the Company. This enables the greatest effect on: the overall audit its operations may be from changes in  strategy, the allocation of resources in regulations that may adversely affect their statements. We take into account size, risk the audit; and directing the efforts of the underlying portfolio investments. Their  engagement team. These matters were approach to managing climate and other and effectiveness of controls, including addressed in the context of our audit of the ESG risks as part of managing investment controls and changes in the business  risk is explained on pages 39 to 41 of the environment when assessing the level of opinion thereon, and we do not provide a Strategic Report, which form part of the work to be performed. separate opinion on these matters. “Other information,” rather than the audited  these disclosures therefore consisted solely of considering whether they are  statements or our knowledge obtained in the course of the audit or otherwise appear to be materially misstated. Governance Pantheon International Plc 155 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Independent Auditor’s Report to the Members of Pantheon International Plc  Risk Our response to the risk  The results of our procedures ### Incorrect valuation of unlisted investments We performed the following procedures:  (£2,239m, 2021: £1,714m) We obtained an understanding of Pantheon’s processes and controls surrounding the in relation to the risk of incorrect investment valuation process including controls that are in place within the Company valuation of unlisted investments  and operated or performed by Pantheon by performing a walkthrough to assess the at fair value.  design and implementation of controls in place.  We performed the following procedures for a sample of investments across all type Value (NAV) of the Company and consists of investments in: of investments: – Third party managed funds. – We independently obtained the most recently available capital allocation statements  – Funds or entities managed by Pantheon. balance and compared the NAV attributable to the Company to the valuation per the Within this investment portfolio are a pool of investments attributed accounting records. to the Company’s Asset Linked Note liability of £39m (2021: £47m). – Where the most recently available capital allocation statements were non- The valuation of the assets held in the investment portfolio is the key coterminous with the reporting date, we obtained details of adjustments for cash driver of the Company’s net asset value and total return. Incorrect   notices and bank statements. generated by the shareholders. – For a sample of new investments during the year, we have obtained and reviewed the We attribute a higher risk of estimation uncertainty to a portfolio of due diligence performed by Pantheon to ensure that the investment recommendation this nature. We therefore deem the valuation of unlisted investments pack was appropriately completed prior to making new investments.  – For a sample of realised investments during the year, we agreed the proceeds of the We have further analysed the unlisted investment portfolio into disposal to the capital account statements and performed back testing by comparing   the sale price and subsequent cash receipts to the most recent valuation recorded by addition to the general audit procedures on unlisted investments to the Company for the investment.  – We reviewed the investment valuations and inquired of Pantheon regarding any potential fair value adjustments as a result of updated information received or   Governance Pantheon International Plc 156 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Independent Auditor’s Report to the Members of Pantheon International Plc  | Risk Our response to the risk | |  | | --- | --- | --- | | Investments in third party managed funds | Additional procedures on investments in third party | | | and co-investment vehicles which are | managed funds and co-investments which are audited | | | audited on an annual basis and for which | on an annual basis and for which periodic fair value | | | periodic fair value information is provided to | information is provided to the Company | | | the Company (£1,847m, 2021: £1,498m) |  | | unlisted investments. Our sample included the testing of 182 investments, totalling The investment portfolio is susceptible to material error due to the £1,438m. We performed the following procedures where applicable: investments being unquoted with no market price available and management relying on third party information. – Inspected the Generally Accepted Accounting Principles (‘GAAP’) applied and reviewed accounting policies on key areas impacting the NAV and compared these to the fair value requirements per FRS102. –   sample of investments with balances which are above our performance materiality. –   to their audit reports. | Investments in third party managed | Additional procedures on investments in third party | | --- | --- | | funds and co-investment vehicles which | managed funds and co-investment vehicles which are | | are not audited on an annual basis | not audited on an annual basis | | (£159m, 2021: £19m) | Where the investments in third party managed funds or co-investments were not | audited on an annual basis we have obtained the fair value calculations supporting the Pantheon obtains the underlying data from the investment value held by the Company, and obtained corroborative evidence for the key inputs used managers of these co-investment vehicles or third-party funds. in deriving the fair values. Pantheon apply the Company’s valuation policy and conclude whether key assumptions used in valuing these assets are Our sample included testing of 28 investments, totalling £145m, which did not have an reasonable. We consider the risk of management override to  be more prevalent in this area. underlying holdings. Governance Pantheon International Plc 157 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Independent Auditor’s Report to the Members of Pantheon International Plc  | Risk Our response to the risk | |  | | --- | --- | --- | | Investments in other funds and | Additional procedures on investments held in other funds | | | entities managed by Pantheon | and entities managed by Pantheon | | | (£264m, 2021: £200m) | For a sample of investments in Pantheon managed funds which are audited, | |  Where the Company invests in other entities managed by Pantheon,  there is an increased risk the fund fair values are susceptible to within the structure, totalling £139m, and 12 investments, totalling £102m, from manipulation due to the related party relationship as Pantheon is  performing the valuation. We performed the following procedures where applicable: – Inspected the Generally Accepted Accounting Principles (‘GAAP’) applied and reviewed accounting policies on key areas impacting the NAV and compared these to the fair value requirements per FRS102. –   of investments. –   – For unaudited investments, we have performed a look through into the investments held by the entity to determine whether the underlying holdings were subject to audit. For those that are audited, we have inspected the Generally Accepted Accounting Principles (‘GAAP’) applied by the underlying holdings and reviewed accounting policies on key areas impacting the NAV and compared these to the fair value requirements per FRS102. Where the internally managed fund and its underlying investments are not audited, we have obtained the fair value calculations for these underlying investments from Pantheon, and obtained corroborative evidence for the key inputs used in deriving the fair values. Governance Pantheon International Plc 158 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Independent Auditor’s Report to the Members of Pantheon International Plc  On the basis of our risk assessments,  – the strategic report and directors’ together with our assessment of the does not cover the other information and, reports have been prepared in We apply the concept of materiality in Company’s overall control environment, except to the extent otherwise explicitly accordance with applicable planning and performing the audit, our judgement was that performance stated in this report, we do not express any legal requirements.   form of assurance conclusion thereon. misstatements on the audit and in  planning materiality, namely £18.2m orming our audit opinion. Our responsibility is to read the other  (2021: £14.0m). We have set performance information and, in doing so, consider Materiality materiality at this percentage due to our In the light of the knowledge and whether the other information is materially understanding of the control environment understanding of the Company and its   that indicates a lower risk of material environment obtained in the course of misstatement that, individually or in the or our knowledge obtained in the course of misstatements, both corrected and   the audit or otherwise appears to be uncorrected. misstatements in the strategic report or  materially misstated. If we identify such directors’ report.  Reporting threshold material inconsistencies or apparent  material misstatements, we are required to We have nothing to report in respect of the  determining the nature and extent determine whether this gives rise to a following matters in relation to which the misstatements are considered as   Companies Act 2006 requires us to report  statements themselves. If, based on the to you if, in our opinion: We determined materiality for the Company | | We agreed with the Audit Committee that | work we have performed, we conclude that | | | --- | --- | --- | --- | | to be £24.3 million (2021: £18.7 million), | | | – adequate accounting records have not | | | we would report to them all uncorrected | there is a material misstatement of the | | |  | | | been kept, or returns adequate for our | | | audit differences in excess of £1.21m | other information, we are required to report | | | funds. We believe that shareholders’ funds | | | audit have not been received from | | |  | that fact. | | | provides us with materiality aligned to the | | | branches not visited by us; or | planning materiality, as well as differences key measure of the Company’s performance. We have nothing to report in this regard. below that threshold that, in our view, –  During the course of our audit, we warranted reporting on qualitative grounds.  the Directors’ Remuneration Report to reassessed initial materiality and made no  be audited are not in agreement with We evaluate any uncorrected changes to the basis of calculation from the accounting records and returns; or misstatements against both the In our opinion the part of the directors’ our original assessment at the planning quantitative measures of materiality remuneration report to be audited has been – certain disclosures of directors’ stage. discussed above and in light of other properly prepared in accordance with the   relevant qualitative considerations in Companies Act 2006. not made; or forming our opinion.  In our opinion, based on the work – we have not received all the information  Other information undertaken in the course of the audit: and explanations we require for  our audit. The other information comprises the – the information given in the strategic  information included in the annual report, report and the directors’ report for the    and undetected misstatements auditor’s report thereon. The directors are statements are prepared is consistent  responsible for the other information  contained within the annual report. Governance Pantheon International Plc 159 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Independent Auditor’s Report to the Members of Pantheon International Plc  –  Auditor’s responsibilities for the audit of However, the primary responsibility for the carried out a robust assessment of the  prevention and detection of fraud rests We have reviewed the directors’ statement | | emerging and principal risks set out | | with both those charged with governance | | --- | --- | --- | --- | | in relation to going concern, longer-term | | Our objectives are to obtain reasonable | | | | on page 145; | | of the Company and management. | | viability and that part of the Corporate | |  | | | Governance Statement relating to the | – The section of the annual report that | statements as a whole are free from | – We obtained an understanding of the | | Company’s compliance with the provisions | describes the review of effectiveness of | material misstatement, whether due | legal and regulatory frameworks that | | of the UK Corporate Governance Code | risk management and internal control | to fraud or error, and to issue an auditor’s | are applicable to the Company and | |  | systems set out on page 145 and; | report that includes our opinion. |  | | Rules. | | Reasonable assurance is a high level | the Companies Act 2006, the Listing | – The section describing the work of the | | | of assurance, but is not a guarantee | Rules, the UK Corporate Governance | | --- | --- | --- | --- | | Based on the work undertaken as part of | audit committee set out on page 143. | | | | | | that an audit conducted in accordance | Code, the Association of Investment | our audit, we have concluded that each of  with ISAs (UK) will always detect a Companies’ Code and Statement of the following elements of the Corporate | | | material misstatement when it exists. | Recommended Practice, Section 1158 | | --- | --- | --- | --- | | Governance Statement is materially | As explained more fully in the directors’ | | | | | | Misstatements can arise from fraud or | of the Corporation Tax Act 2010 and | |  | responsibilities statement set out on | | | | | | error and are considered material if, | The Companies (Miscellaneous | | our knowledge obtained during the audit: | page 153, the directors are responsible for | | | | | | individually or in the aggregate, they could | Reporting) Regulations 2018. |  – The Directors’ statement with regards   – We understood how the Company is to the appropriateness of adopting the economic decisions of users taken on and fair view, and for such internal control complying with those frameworks going concern basis of accounting and  as the directors determine is necessary through discussions with the Audit    Committee and the Company Secretary out on page 137; statements that are free from material  and a review of Board minutes and the – The Directors’ explanation as to misstatement, whether due to fraud  Company’s documented policies its assessment of the Company’s or error. and procedures. Irregularities, including fraud, are instances prospects, the period this assessment  of non-compliance with laws and – We assessed the susceptibility of the covers and why the period is appropriate directors are responsible for assessing the regulations. We design procedures in  set out on page 55; | | Company’s ability to continue as a going | line with our responsibilities, outlined | material misstatement, including how | | --- | --- | --- | --- | | – The Director’s statement on whether it | concern, disclosing, as applicable, matters | above, to detect irregularities, including | fraud might occur by considering the key | | has a reasonable expectation that the | related to going concern and using the | fraud. The risk of not detecting a material |  | | Company will be able to continue in | going concern basis of accounting unless | misstatement due to fraud is higher than |  | | operation and meets its liabilities set | the directors either intend to liquidate the | the risk of not detecting one resulting from | to management override in relation | | out on page 137; | Company or to cease operations, or have | error, as fraud may involve deliberate | to investments in funds and entities | | | no realistic alternative but to do so. | concealment by, for example, forgery | managed by Pantheon and investments | – The Directors’ statement on fair, or intentional misrepresentations, or in third party managed funds and balanced and understandable set through collusion. The extent to which co-investment vehicles which are not out on page 153; our procedures are capable of detecting audited on an annual basis. Further irregularities, including fraud is detailed discussion of our approach is set below. out in the section on the key audit matters above. Governance Pantheon International Plc 160 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ### Independent Auditor’s Report to the Members of Pantheon International Plc – Based on this understanding we Use of our report designed our audit procedures to identify This report is made solely to the Company’s non-compliance with such laws and members, as a body, in accordance with regulations. Our procedures involved Chapter 3 of Part 16 of the Companies Act a review of the Company Secretary’s 2006. Our audit work has been undertaken reporting to the Directors with respect so that we might state to the Company’s to the application of the documented members those matters we are required policies and procedures and review of to state to them in an auditor’s report and  for no other purpose. To the fullest extent compliance with the reporting permitted by law, we do not accept or requirements of the Company. assume responsibility to anyone other than A further description of our responsibilities the Company and the Company’s members  as a body, for our audit work, for this report, is located on the FRC’s website at https:// or for the opinions we have formed. www.frc.org.uk/auditorsresponsibilities.   This description forms part of our auditor’s  report. for and on behalf of Ernst & Young LLP, Statutory Auditor  London – Following the recommendation from 3 August 2022 the audit committee, we were appointed by the Company on 2 December 2019  the year ending 31 May 2020 and  – The period of total uninterrupted engagement including previous renewals and reappointments is 3 years, covering the years ending 31 May 2020 to 31 May 2022. – The audit opinion is consistent with the additional report to the audit committee. Governance Pantheon International Plc 161 2022 Strategic Report Manager’s Review Financial Statements Other Information Annual Report and Accounts ## Financial Statements Income Statement 163 Statement of Changes in Equity 164 Balance Sheet 165 Cash Flow Statement 166 Notes to the Financial Statements 167 Financial Statements Financial Statements Pantheon International Plc 162 Pantheon International Plc 162 2022 2022 Strategic Report Manager’s Review Governance Other Information Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts Annual Report and Accounts ### Income Statement Year ended 31 May 2022   | | | | | | | 1 | | | | | 1 | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | Revenue | | Capital | Total | | Revenue | | Capital | Total | | | | Note | £’000 | | £’000 | £’000 | | | £’000 | £’000 | £’000 | | |  | 9b | | – 570,049 570,049 – 341,802 341,802 | | | | | | | | | 2  (305) (3,123) (3,428) (976) (11,571) (12,547) Currency gains/(losses) on cash and borrowings – 19,564 19,564 – (18,452) (18,452) | Investment income | 2 | 19,169 – 19,169 16,418 – 16,418 | | --- | --- | --- | | Investment management fees | 3 | (23,115) – (23,115) (18,544) – (18,544) | | Other expenses | 4 | (1,274) (1,326) (2,600) (1,417) (1,340) (2,757) |  (5,525) 585,164 579,639 (4,519) 310,439 305,920 Interest payable and similar expenses  (3,967) – (3,967) (3,488) – (3,488)  (9,492) 585,164 575,672 (8,007) 310,439 302,432 Taxation (paid)/recovered 7 (3,075) – (3,075) 3,533 – 3,533  (12,567) 585,164 572,597 (4,474) 310,439 305,965 3 8 Return per ordinary share (2.32)p 108.38p 106.06p (0.83)p 57.4 0 p 56.57p 1 The Company does not have any income or expenses that are not included in the return for the period, therefore the return for the period is also the total comprehensive income for the period. The supplementary revenue and capital columns are prepared under guidance published in the Statement of Recommended Practice (“SORP”) issued by the Association of Investment Companies (“AIC”). 2 Includes currency movements on investments.     All revenue and capital items in the above statement relate to continuing operations. The total column of the statement represents the Company’s Statement of Total Comprehensive Income prepared in accordance with Financial Reporting Standards (“FRS”). No operations were acquired or discontinued during the period. There were no recognised gains or losses other than those passing through the Income Statement.  Financial Statements Pantheon International Plc 163 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts ### Statement of Changes in Equity Year ended 31 May 2022 Capital | | | | Capital | Other | reserve on | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Share | Share | redemption | | capital | investments | | Revenue | | | | capital | premium | | reserve | reserve | | held | reserve | | Total | | £’000 | £’000 | | £’000 | £’000 | | £’000 | | £’000 | £’000 | Movement for the year ended 31 May 2022 Opening equity shareholders’ funds 36,240 269,535 3,325 976,685 679,736 (100,290) 1,865,231 Return for the year – – – 590,025 (4,861) (12,567) 572,597 Ordinary shares bought back for cancellation (228) – 228 (10,364) – – (10,364)  36,012 269,535 3,553 1,556,346 674,875 (112,857) 2,427,464 Movement for the period ended 31 May 2021 Opening equity shareholders’ funds 36,240 269,535 3,325 842,675 503,307 (95,816) 1,559,266 Return for the year – – – 134,010 176,429 (4,474) 305,965  36,240 269,535 3,325 976,685 679,736 (100,290) 1,865,231  The NAV per ordinary share at 31 May 2022 was 451.6 pence per share (31 May 2021: 344.8 pence per share). During the year ended 31 May 2022, 3,275,830 ordinary shares were bought back in the market, to be held in Treasury (year ended 31 May 2021: nil) at a total cost, including stamp duty, of £10.0m. The 3,275,830 shares that were held in Treasury were subsequently cancelled prior to the end of May 2022. In addition, during the year ended 31 May 2022, 125,000 shares were bought back for cancellation (year ended 31 May 2021: nil), at a total cost, including stamp duty, of £0.3m. As a result, there were 537,493,640 ordinary shares in issue as at 31 May 2022 (of which none are held in Treasury; year to 31 May 2021: 54,089,447 ordinary shares and no Treasury shares). Financial Statements Pantheon International Plc 164 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts ### Balance Sheet As at 31 May 2022 31 May 2022 31 May 2021 Note £’000 £’000  Investments at fair value  2,238,608 1,713,724 Current assets Debtors 11 2,123 8,215 Cash at bank 231,458 199,118 233,581 207,333  Other creditors 12 6,138 9,039 6,138 9,039  227,4 43 198,294  2,466,051 1,912,018  Asset Linked Loan Note (“ALN”) 13 38,587 46,787 38,587 46,787 Net assets 2,427,464 1,865,231 Capital and reserves | Called-up share capital | 14 | | 36,012 36,240 | | --- | --- | --- | --- | | Share premium | 15 | | 269,535 269,535 | | Capital redemption reserve | 15 | | 3,553 3,325 | | Other capital reserve | 15 | 1,556,346 976,685 | | | Capital reserve on investments held | 15 | | 674,875 679,736 | | Revenue reserve | 15 | (112,857) (100,290) | |  2,427,464 1,865,231 1  Net asset value per Ordinary share 451.63p 344.84p       Chair Company No. 2147984 Financial Statements Pantheon International Plc 165 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts ### Cash Flow Statement Year ended 31 May 2022 | | Year ended | | Year ended | | | --- | --- | --- | --- | --- | | | 31 May 2022 | | 31 May 2021 | | | Note | | £’000 | | £’000 |  1 Investment income received 19,157 16,311 Deposit and other interest received 28 87 Investment management fees paid (22,637) (18,416) Secretarial fees paid (300) (263) Depositary fees paid (254) (225) Directors’ fees paid (307) (338) Legal & Professional fees paid (1,707) (1,544) 2 Other cash payments (804) (978) Withholding tax (deducted)/recovered (3,626) 3,602  18 (10,450) (1,764)  3 Purchases of investments (352,620) (226,205) 3 Disposals of investments 402,700 344,559  50,080 118,354  ALN repayments (13,786) (24,286) Ordinary shares purchased for cancellation (10,360) – Loan commitment and arrangement fees paid (2,853) (4,888)  (26,999) (29,174)  12,631 87,416  199,118 130,091  19,709 (18,389)  231,458 199,118 1 The investment income received is comprised solely of dividend income. 2 Includes interest paid during the year of £96,000 (2021: £66,000). 3 Purchases and disposals do not include investments actioned by Pantheon International Holdings LP and also exclude the non-cash intercompany transfer of assets.  Financial Statements Pantheon International Plc 166 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts # Notes to the Financial Statements ## 1 Accounting Policies PIP is a listed public limited company incorporated in England and Wales. The registered office is detailed on page 199. A summary of the principal accounting policies and measurement bases, all of which have been applied consistently throughout the year, is set out below. ### A. Basis of Preparation The Company's financial statements have been prepared in compliance with FRS 102 as it applies to the financial statements of the Company for the year ended 31 May 2022. They have also been prepared on the assumption that approval as an investment trust will continue to be granted. The Company's financial statements are presented in sterling and all values are rounded to the nearest thousand pounds (£'000) except when indicated otherwise. The investments in the subsidiaries, which are valued at NAV, are as financial assets, and held at fair value through profit or loss. The financial statements have been prepared in accordance with the SORP for the financial statements of investment trust companies and venture capital trusts issued by the AIC, other than where restrictions are imposed on the Company which prohibit specific disclosures, as noted on pages 117 and 124. ### B. Going Concern The financial statements have been prepared on a going concern basis and under the historical cost basis of accounting, modified to include the revaluation of certain assets at fair value. The Directors have made an assessment of going concern, taking into account the Company's current performance and financial position as at 31 May 2022. In addition, the Directors have assessed the outlook, which considers a disrupted recovery in the wake of the COVID-19 pandemic, the ongoing geopolitical uncertainties as a result of the Russia–Ukraine conflict including the disruption to the global supply chain and increases in the cost of living as a result of this conflict, persistent inflation, interest rate rises and the impact of climate change on PIP's portfolio using the information available up to the date of issue of the financial statements. As part of this assessment the Directors considered: - Various downside liquidity modelling scenarios with varying degrees of decline in investment valuations, decreased investment distributions, and increased call rates, with the worst being a low case downside scenario representing an impact to the portfolio that is worse than that experienced during the Global Financial Crisis. - The Company manages and monitors liquidity regularly ensuring it is adequate and sufficient and is underpinned by its monitoring of investments, distributions, capital calls and outstanding commitments. Total available financing as at 31 May 2022 stood at £528m (31 May 2021: £475m), comprising £227m (31 May 2021: £198m) in available cash balances and £361m in undrawn, sterling equivalent, bank facilities (31 May 2021: £277m). - PIP's 31 May 2022 valuation is primarily based on reported QF valuations with a reference date of 31 March 2022, updated for capital movements and foreign exchange impacts. As the longer-term impacts of COVID-19, the ongoing geopolitical uncertainties as a result of the Russia–Ukraine conflict and the impact of climate change may not be fully apparent, the Directors have considered the impact that declining valuations could have on the Company's going concern assessment. - Unfunded commitments – PIP's unfunded commitments at 31 May 2022 were £755m (31 May 2021: £528m). The Directors have considered the maximum level of unfunded commitments which could theoretically be drawn in a 12-month period, the ageing of commitments and available financing to fulfil these commitments. In these scenarios PIP can take steps to limit or mitigate the impact on the Balance Sheet, namely drawing on the credit facility, pausing on new commitments, selling assets to increase liquidity and reducing outstanding commitments if necessary. In addition, subject to market conditions, the Company could also seek to raise additional credit or capital. Since the period end, the Company has announced that it has agreed a new revolving credit facility, totalling £800m which is due to expire in July 2027. - The Directors have also considered the impact of climate change on PIP's portfolio and have come to the conclusion that there is no significant impact on the Company as a result of climate change. Having performed the assessment on going concern, the Directors considered it appropriate to prepare the financial statements of the Company on a going concern basis. The Company has sufficient financial resources and liquidity, is well placed to manage business risks in the current economic environment, and can continue operations for a period of at least 12 months from the date of issue of these financial statements. ### C. Segmental Reporting The Directors are of the opinion that the Company is engaged in a single segment of business, being an investment business. Consequently no business segmental analysis is provided. Strategic Report Manager's Review Governance Financial Statements Other Information Pantheon International Plc Annual Report and Accounts 2022 | 167 ### Notes to the Financial Statements The Company may acquire secondary interests at either a premium or a discount to the fund 1  manager’s valuation. Within the Company’s portfolio, those fund holdings are normally revalued to their stated net asset values at the next reporting date unless an adjustment D. Valuation of Investments  Given the nature of the Company’s assets which comprise predominantly unlisted fund  investments, while the Company operates a robust and consistent valuation process, investments in unquoted companies, the initial valuation is based on the transaction price.  Where better indications of fair value become available, such as through subsequent issues of estimated at a point in time. Accordingly, while the Company considers circumstances  where it might be appropriate to apply an override, for instance in response to a market at each reporting date. This information may include the valuations provided by private equity  managers who are also invested in the Company. Similarly, while relevant information relating to but received after the measurement date is   Private equity funds may contain a proportion of quoted shares from time to time, for example  where the underlying company investments have been taken public but the holdings have not  yet been sold. The quoted market holdings at the date of the latest fund accounts are reviewed  and compared with the value of those holdings at the period end.  iii. Deferred payment transactions  initial recognition. The Company may engage in deferred payment transactions. Where the Company engages   present value of the future payments discounted at a market rate of interest for a similar basis in accordance with its investment strategy. For investments actively traded in organised debt instrument. The difference between the present value and the undiscounted value is   market bid prices at the close of business at the Balance Sheet date. For investments that in the Income Statement.  valuation techniques as described below:   As part of the share consolidation effected on 31 October 2017, the Company issued an ALN with an initial principal amount of £200m to the Investor. Payments under the ALN are made In the case of investments in private equity funds, this is based on the net asset value of those   funds ascertained from periodic valuations provided by the managers of the funds and reference portfolio which consists of interests held by the Company in over 300 of its oldest recorded up to the measurement date. Such valuations are necessarily dependent upon the private equity funds, substantially 2006 and earlier vintages. The Company retains the net reasonableness of the valuations by the fund managers of the underlying investments. In the  absence of contrary information, the values are assumed to be reliable. These valuations are reviewed periodically for reasonableness and recorded up to the measurement date. If a class  of assets were sold post-period end, management would consider the effect, if any, on the  investment portfolio.  value movement is allocated between revenue and capital pro rata to the fair value gains and income-generated movements in the reference portfolio. Financial Statements Pantheon International Plc 168 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts ### Notes to the Financial Statements  1  All expenses are accounted for on an accruals basis. Expenses, including investment management fees, are charged through the revenue account except as follows: A pro rata share of the Company’s total ongoing charges is allocated to the ALN, reducing each quarterly payment (“the Expense Charge”) and deducted from Other Expenses through – Expenses which are incidental to the acquisition or disposal of an investment are treated the revenue account in the Income Statement.   – Expenses of a capital nature are accounted for through the capital account; and amounts are deducted from taxation through the revenue account in the Income Statement. – Investment performance fees. See Note 13 for further information.   The functional and presentational currency of the Company is pounds sterling (“sterling”) because it is the primary currency in the economic environment in which the Company Dividends receivable on quoted equity shares are brought into account on the ex-dividend date. operates. Transactions denominated in foreign currencies are recorded in the local currency Dividends receivable on equity shares where no ex-dividend date is quoted are brought into at actual exchange rates as at the date of transaction. Monetary assets and liabilities  denominated in foreign currencies at the period end are reported at the rates of exchange debt security is recognised on a time apportionment basis. prevailing at the period end. Any gain or loss arising from a change in exchange rates subsequent to the date of the transaction is included as an exchange gain or loss in the Income distributions from funds are recognised when the right to distributions is established. revenue or capital column of the Income Statement depending on whether the gain or loss  is of a capital or revenue nature. For non-monetary assets, these are covered by fair value adjustments. For details of transactions included in the capital column of the Income  Statement please see (J) and (K) below. takes into account taxation deferred or accelerated because of timing differences between the treatment of certain items for accounting and taxation purposes. Full provision for J. Other Capital Reserve deferred taxation is made under the liability method, without discounting, on all timing The following are accounted for in this reserve: differences that have arisen but not reversed by the Balance Sheet date. – Investment performance fees; The tax effect of different items of income/gain and expenditure/loss is allocated between capital and revenue on the same basis as the particular item to which it relates, using the – Gains and losses on the realisation of investments; marginal method. – Realised exchange difference of a capital nature; and Dividends receivable are recognised at an amount that may include withholding tax – Expenses of a capital nature. (but excludes other taxes, such as attributable tax credits). Any withholding tax suffered is shown as part of the revenue account tax charge. Capital distributions from investments are accounted for on a reducing cost basis; cash  Deferred tax is not provided on capital gains and losses arising on the revaluation or disposal recognised as realised only when the cost has been reduced to nil. of investments because the Company meets (and intends to continue for the foreseeable future to meet) the conditions for approval as an investment trust company, pursuant to  sections 1158 and 1159 of the CTA. The following are accounted for in this reserve: Deferred tax assets are only recognised if it is considered more likely than not that there will – Increases and decreases in the value of investments held at the year end and the ALN.  Financial Statements Pantheon International Plc 169 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts # Notes to the Financial Statements ## 1 Accounting Policies ### L. Investment Performance Fee The Manager is entitled to a performance fee from the Company in respect of each 12 calendar-month period ending on 31 May of each year. The performance fee payable in respect of each such calculation period is 5% of the amount by which the net asset value at the end of such period exceeds 110% of the applicable "high-water mark", i.e. the net asset value at the end of the previous calculation period in respect of which a performance fee was payable, compounded annually at 10% for each subsequent completed calculation period up to the start of the calculation period for which the fee is being calculated. For the calculation period ended 31 May 2022, the notional performance fee hurdle is a net asset value per share of 461.2p. The performance fee is calculated using the adjusted net asset value. The net asset value per share at 31 May 2022 is 461.6p. The performance fee is calculated so as to ignore the effect on performance of any performance fee payable in respect of the period for which the fee is being calculated or of any increase or decrease in the net assets of the Company resulting from any issue, redemption or purchase of any shares or other securities, the sale of any treasury shares or the issue or cancellation of any subscription or conversion rights for any shares or other securities and any other reduction in the Company's share capital or any distribution to shareholders. ### M. Significant Judgements and Estimates The preparation of financial statements requires the Manager to make judgements, estimates and assumptions that affect the reported amounts of investments at fair value at the financial reporting date and the reported fair value movements during the reporting period. Actual results may differ from these estimates. Details of how the fair values of unlisted investments are estimated and any associated judgements applied are provided in Section (3) of this Note and also within the Market Price Risk section in Note 20. ### N. Derecognition/Recognition of Assets and Liabilities Financial assets and financial liabilities are recognised on the Company's Balance Sheet when the Company becomes a party to the contractual provisions of the instrument. In accordance with FRS102, financial assets are derecognised when the contractual rights to the cash flows from the instrument expire or the asset is transferred and the transfer qualifies for derecognition. Financial liabilities are derecognised when the obligation is discharged, extinguished or expired. ## 2 Income | | 31 May 2022 £'000 | 31 May 2021 £'000 | | --- | --- | --- | | **Income from investments** | | | | Investment income | 19,137 | 16,331 | | | 19,137 | 16,331 | | **Other income** | | | | Interest | 28 | 89 | | Exchange difference on income | 4 | (2) | | | 32 | 87 | | **Total income** | **19,169** | **16,418** | | **Total income comprises** | | | | Dividends | 19,137 | 16,331 | | Bank interest | 28 | 39 | | Other interest | - | 50 | | Exchange difference on income | 4 | (2) | | | 19,169 | 16,418 | | **Analysis of income from investments** | | | | Unlisted | 19,137 | 16,331 | | | 19,137 | 16,331 | | **Geographical analysis** | | | | UK | 306 | 3 | | US | 14,345 | 12,345 | | Other overseas | 4,486 | 3,983 | | | 19,137 | 16,331 | Strategic Report Manager's Review Governance Financial Statements Other Information Panthesin International Plc Annual Report and Accounts 2022 | 170 ## Notes to the Financial Statements ### 3 Investment Management Fees | | 31 May 2022 | | | 31 May 2021 | | | | --- | --- | --- | --- | --- | --- | --- | | | Revenue £'000 | Capital £'000 | Total £'000 | Revenue £'000 | Capital £'000 | Total £'000 | | Investment management fees | 23,115 | – | 23,115 | 18,544 | – | 18,544 | | | 23,115 | – | 23,115 | 18,544 | – | 18,544 | The investment management fee is payable monthly in arrears at the rate set out in the Directors' Report on pages 136 and 137. During the year, services with a total value of £23,977,000 (period to 31 May 2021: £18,896,000), being £23,115,000 (period to 31 May 2021: £18,544,000) directly from Pantheon Ventures (UK) LLP and £952,000 (period to 31 May 2021: £352,000) via Pantheon managed fund investments were purchased by the Company. The value of investments in, and outstanding commitments to, investment funds managed or advised by the Pantheon Group ("Pantheon Funds") are excluded in calculating the monthly management fee and the commitment fee. The value of holdings in investments managed by the Pantheon Group totalled £397,332,000 as at 31 May 2022 (31 May 2021: £24,344,000), including £812,172,000 from the new Pantheon managed Pantheon International Holdings subsidiaries (31 May 2021 £nil). Please see note 17 for further details. In addition, the Manager has agreed that the total fees (including performance fees) payable by Pantheon Funds to members of the Pantheon Group and attributable to the Company's investments in Pantheon Funds shall be less than the total fees (excluding the performance fee) that the Company would have been charged under the Management Agreement had it invested directly in all of the underlying investments of the relevant Pantheon Funds instead of through the relevant Pantheon Funds. At 31 May 2022, £2,124,000 (31 May 2021: £1,646,000) was owed to the Investment Manager in respect of the investment management fees. No performance fee is payable in respect of the year to 31 May 2022 (31 May 2021: nil). The basis upon which the performance fee is calculated is explained in Note 1 (i) and in the Directors' Report on pages 136 and 137. Strategic Report Manager's Review Governance Financial Statements Other Information Pantheon International Plc Annual Report and Accounts 2022 | 01 ## Notes to the Financial Statements ### 4 Other Expenses | | 31 May 2022 | | | 31 May 2021 | | | | --- | --- | --- | --- | --- | --- | --- | | | Revenue ('000) | Capital ('000) | Total ('000) | Revenue ('000) | Capital ('000) | Total ('000) | | Secretarial and accountancy services | 312 | – | 312 | 243 | – | 243 | | Depository fees | 238 | – | 238 | 233 | – | 233 | | Fees payable to the Company's Auditor for the | | | | | | | | – audit of the annual financial statements | 105 | – | 105 | 115 | – | 115 | | Fees payable to the Company's Auditor for | | | | | | | | – audit-related assurance services – Half-Yearly Report | 35 | – | 35 | 35 | – | 35 | | Directors' remuneration (see Note 5) | 311 | – | 311 | 331 | – | 331 | | Employer's National Insurance | 34 | – | 34 | 25 | – | 25 | | Irrecoverable VAT | (47) | – | (47) | 117 | – | 117 | | Legal and professional fees | 317 | 1,326 | 1,643 | 315 | 1,245 | 1,560 | | Other | 701 | – | 701 | 706 | 95 | 801 | | ALN Expense Charge (see Note 1 (F))^{1} | (732) | – | (732) | (703) | – | (703) | | | 1,274 | 1,326 | 2,600 | 1,417 | 1,340 | 2,757 | $^{1}$ A pro rata share of the Company's total ongoing charges is allocated to the ALN, reducing each quarterly payment. The Directors do not consider that the provision of non-audit work to the Company affects the independence of the Auditors due to the half year review being an assurance service. Strategic Report Manager's Review Governance Financial Statements Other Information Pantheon International Plc Annual Report and Accounts 2022 | 172 ## Notes to the Financial Statements ### 5 Directors' Remuneration Directors' emoluments comprise Directors' fees. A breakdown is provided in the Directors' Remuneration Report on pages 190 and 192. ### 6 Interest Payable and Similar Expenses | | 31 May 2022 £'000 | 31 May 2021 £'000 | | --- | --- | --- | | Negative bank interest | 96 | 66 | | Loan commitment and arrangement fees | 3,871 | 3,422 | | | 3,967 | 3,488 | On 1 June 2018, the Company agreed a four-year £175m multi-currency revolving credit facility agreement, arranged by Lloyds Bank and NatWest Markets. This replaced the four-year £150m loan facility agreement, with the Royal Bank of Scotland plc and Lloyds Bank plc, which was due to expire in November 2018. Upfront fees of £1.6m are being amortised from 1 June 2018, over the four-year life. A commitment fee of 0.94% per annum is payable quarterly, in respect of the amounts available for drawdown. Interest payable on any drawdown amount is payable for the duration of the drawdown period. At 31 May 2022, the total available facility with State Street Bank and Trust Company is £300m. The aggregate loan facility of £300m is split into two tranches of US$269.8m and €101.6m, retranslated to £301m as at 31 May 2022 (2021: £277m). In February 2021, the Company agreed to extend the facility end date for a further two years, to 31 May 2024. Upfront fees of £2.2m, in relation to this extension agreement, are being amortised over the remaining life of the loan, until 31 May 2024. On 2 August 2022, the Company announced that it has agreed a new five-year £500m multi-tranche, multi-currency revolving credit facility agreement arranged by Credit Suisse AG London Branch, Lloyds Bank Corporate Markets plc and State Street Bank International GmbH. The Loan Facility, which replaced the £300m loan facility agreement due to expire in May 2024, is comprised of facilities amounting to $512.9m and €89.2m and secured by certain assets of the Company. The new facility will expire in July 2027 with an ongoing option to extend, by agreement, the maturity date by another year at a time. The new facility will have a blended commitment fee of 0.95% per annum on available commitments, pricing equivalent to the relevant benchmark rate plus 2.350% to 2.575% depending on utilisation, and is subject to loan to value and liquidity ratios. This loan facility provides a margin of additional assurance that the Company has the ability to finance its unfunded commitments in the future. At 31 May 2022 and 31 May 2021, the loan facility remained fully undrawn. Strategic Report Manager's Review Governance Financial Statements Other Information Pantheon International Plc Annual Report and Accounts 2022 | 173 ## Notes to the Financial Statements ### 7 Taxation | | 31 May 2022 | | | 31 May 2021 | | | | --- | --- | --- | --- | --- | --- | --- | | | Revenue £'000 | Capital £'000 | Total £'000 | Revenue £'000 | Capital £'000 | Total £'000 | | Withholding tax deducted/(recovered) from distributions | 3,075 | – | 3,075 | (3,533) | – | (3,533) | | **Tax charge** | | | | | | | | The tax charge/(credit) for the year differs from the standard rate of corporation tax in the UK (19%). The differences are explained below: | | | | | | | | Net return before tax | (9,492) | 585,164 | 575,672 | (8,007) | 310,439 | 302,432 | | Theoretical tax at UK corporation tax rate of 19% (31 May 2021: 19%) | (1,803) | 111,181 | 109,378 | (1,521) | 58,983 | 57,462 | | Non-taxable investment, derivative and currency gains | – | (111,433) | (111,433) | – | (59,238) | (59,238) | | Effect of expenses in excess of taxable income | – | 252 | 252 | – | 237 | 237 | | Expenses disallowable for tax purposes | – | – | – | – | 18 | 18 | | Carry forward management expenses | 1,803 | – | 1,803 | 1,521 | – | 1,521 | | Withholding tax deducted/(recovered) from distributions | 3,075 | – | 3,075 | (3,533) | – | (3,533) | | | 3,075 | – | 3,075 | (3,533) | – | (3,533) | The tax charge for the year ended 31 May 2022 is £3.1m (31 May 2021: tax credit of £3.5m). The tax charge is wholly comprised of irrecoverable withholding tax suffered. Investment gains are exempt from capital gains tax owing to the Company's status as an investment trust. During the prior year to 31 May 2021, and included within the above, there was a tax credit, resulting from a refund of prior years' taxation amounting to £6.1m, from the US Inland Revenue Service. As this tax credit was due to a build up of previous claims that have now been recovered, a recoverable amount will not recur going forward as recoverable amounts are now claimed and received through a regular process. ### Factors That May Affect Future Tax Charges The Company is an investment trust and therefore is not subject to tax on capital gains. Deferred tax is not provided on capital gains and losses arising on the revaluation or disposal of investments because the Company meets (and intends to meet for the foreseeable future) the conditions for approval as an investment trust company. No deferred tax asset has been recognised in respect of excess management expenses and expenses in excess of taxable income as they will only be recoverable to the extent that there is sufficient future taxable revenue. As at 31 May 2022, excess management expenses are estimated to be in excess of £227m (31 May 2021: £249m). At 31 May 2022, the Company had no unprovided deferred tax liabilities (31 May 2021: £nil). Strategic Report Manager's Review Governance Financial Statements Other Information Panthesin International Plc Annual Report and Accounts 2022 | 174 ## Notes to the Financial Statements ### 8 Return per Ordinary Share | | 31 May 2022 | | | 31 May 2021 | | | | --- | --- | --- | --- | --- | --- | --- | | | Revenue £'000 | Capital £'000 | Total £'000 | Revenue £'000 | Capital £'000 | Total £'000 | | Return for the financial period in £'000 | (12,567) | 585,164 | 572,597 | (4,474) | 310,439 | 385,965 | | Weighted average ordinary and redeemable shares | | | 539,896,863 | | | 540,894,470 | | Return per ordinary share | (2.32)p | 108.38p | 106.06p | (0.83)p^{1} | 57.40p^{1} | 56.57p^{1} | $^{1}$ Restated to reflect the subsequent 10 for 1 share split There are no dilutive or potentially dilutive shares in issue. Strategic Report Manager's Review Governance Financial Statements Other Information Pantheon International Plc Annual Report and Accounts 2022 | 175 ### Notes to the Financial Statements 9a Movement on Investments 31 May 2022 31 May 2021 £’000 £’000 Book cost brought forward 1,003,796 973,761 Opening unrealised appreciation on investments held: – Unlisted investments 709,712 521,565 – Listed investments 216 363 Valuation of investments brought forward 1,713,724 1,495,689 Movements in year: Acquisitions at cost 979,764 226,205 1 Capital distributions – proceeds (1,024,931) (349,972) 1 Capital distributions – realised gains on sales 571,790 153,802 (Decrease)/increase in appreciation on investments held (1,739) 188,000 Valuation of investments at year end 2,238,608 1,713,724 Book cost at year end 1,530,419 1,003,796 Closing unrealised appreciation on investments held: – Unlisted investments 706,707 709,712 – Listed investments 1,482 216 Valuation of investments at year end 2,238,608 1,713,724  Unlisted investments 2,235,639 1,713,508 Listed investments 2,969 216 Valuation of investments at year end 2,238,608 1,713,724    Further details in relation to the structuring arrangements are included in Note 17. Financial Statements Pantheon International Plc 176 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts ## Notes to the Financial Statements ### 9b Analysis of Investments Further analysis of the investment portfolio is provided in the Manager's Review on pages 57 to 62. Transaction costs (incurred at the point of the transaction) incidental to the acquisition of investments totalled £nil (31 May 2021: £nil) and to the disposals of investments totalled £4,000 (31 May 2021: £12,000) for the period. In addition, legal fees incidental to the acquisition of investments totalled £1,326,000 (31 May 2021: £1,340,000), as disclosed in Note 4, and have been taken to the capital column in the Income Statement since they are capital in nature. Included in investments are also investments that the Company holds in its subsidiaries. Please see note 17 for further details. | | 31 May 2022 £'000 | 31 May 2021 £'000 | | --- | --- | --- | | Realised gains on sales | 571,790 | 153,882 | | Amounts previously recognised as unrealised appreciation on those sales | 216 | 363 | | (Decrease)/increase in unrealised appreciation | (1,955) | 187,637 | | Revaluation of amounts owed in respect of transactions | (3) | — | | Gains on investments | 570,049 | 341,802 | | **Sterling** | | | | Unlisted investments | 872,089 | 67,451 | | | 872,089 | 67,451 | | **US dollar** | | | | Unlisted investments | 1,083,342 | 1,266,123 | | Listed investments | 2,969 | 216 | | | 1,086,311 | 1,266,339 | | **Euro** | | | | Unlisted investments | 247,749 | 337,522 | | | 247,749 | 337,522 | | **Other** | | | | Unlisted investments | 32,459 | 42,412 | | | 32,459 | 42,412 | | | 2,238,608 | 1,713,724 | Strategic Report Manager's Review Governance Financial Statements Other Information Panthesin International Plc Annual Report and Accounts 2022 | 177 ## Notes to the Financial Statements ### 9c Material Investment At the period-end, the Company held the following material holdings in an investee undertaking which exceeded 3% of any class of capital: | Investment | % ownership | Closing net assets value £'000 | | --- | --- | --- | | Zenith 1 LP | 5.88 | 2,001 | | Gemini Israel V | 4.65 | 16,145 | | LYFE Capital Fund II | 3.36 | 18,118 | | Balderton Growth Fund I | 3.19 | 6,982 | ### 10 Fair Value Hierarchy The fair value hierarchy consists of the following three levels: Level 1 – The unadjusted quoted price in an active market for identical assets or liabilities that the entity can access at the measurement date. The Level 1 holdings include publicly listed holdings held directly by the Company from in-specie distributions received from underlying investments, but does not include listed holdings held indirectly through the Company's underlying private equity managers which are classified under Level 3 holdings; Level 2 – Inputs other than quoted prices included within Level 1 that are observable (i.e. developed using market data) for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and Level 3 – Inputs are unobservable (i.e. for which market data is unavailable) for the asset or liability. #### Financial Assets at Fair Value Through Profit or Loss at 31 May 2022 | | Level 1 £'000 | Level 2 £'000 | Level 3 £'000 | Total £'000 | | --- | --- | --- | --- | --- | | Unlisted holdings | – | – | 2,235,639 | 2,235,639 | | Listed holdings | 2,969 | – | – | 2,969 | | | 2,969 | – | 2,235,639 | 2,238,608 | Strategic Report Manager's Review Governance Financial Statements Other Information Panthesn International Plc Annual Report and Accounts 2022 | 178 ## Notes to the Financial Statements ### 10 Fair Value Hierarchy #### Financial Assets at Fair Value Through Profit or Loss at 31 May 2021 | | Level 1 €'000 | Level 2 €'000 | Level 3 €'000 | Total €'000 | | --- | --- | --- | --- | --- | | Unlisted holdings | – | – | 1,713,508 | 1,713,508 | | Listed holdings | 216 | – | – | 216 | | | 216 | – | 1,713,508 | 1,713,724 | #### Financial Liabilities at Fair Value Through Profit or Loss at 31 May 2022 | | Level 1 €'000 | Level 2 €'000 | Level 3 €'000 | Total €'000 | | --- | --- | --- | --- | --- | | Asset Linked Note | – | – | 41,374 | 41,374 | | | – | – | 41,374 | 41,374 | #### Financial Liabilities at Fair Value Through Profit or Loss at 31 May 2021 | | Level 1 €'000 | Level 2 €'000 | Level 3 €'000 | Total €'000 | | --- | --- | --- | --- | --- | | Asset Linked Note | – | – | 53,015 | 53,015 | | | – | – | 53,015 | 53,015 | ### 11 Debtors | | 31 May 2022 €'000 | 31 May 2021 €'000 | | --- | --- | --- | | Amounts owed by investment funds | 595 | 5,656 | | Prepayments and accrued income | 1,528 | 2,559 | | | 2,123 | 8,215 | Strategic Report Manager's Review Governance Financial Statements Other Information Pantheon International Plc Annual Report and Accounts 2022 | 179 ### Notes to the Financial Statements 12  31 May 2022 31 May 2021 £’000 £’000 Investment management fees 2,124 1,646 Amounts owed in respect of transactions 4 – ALN repayment to the investor 2,787 6,228 Other creditors and accruals 1,223 1,165 6,138 9,039 13  31 May 2022 31 May 2021 £’000 £’000 Opening value of ALN 53,015 65,386  (13,786) (24,286)  3,428 12,547 Expense Charge and ALN share of withholding taxes (1,283) (632) Closing Value of ALN (see Note 1(F)) 41,374 53,015 Transfer to creditors due within one year (2,787) (6,228) 38,587 46,787 Financial Statements Pantheon International Plc 180 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts ## Notes to the Financial Statements ### 14 Called-up Share Capital | | 31 May 2022 | | 31 May 2021 | | | --- | --- | --- | --- | --- | | | Shares | £'000 | Shares | £'000 | | **Allotted, called up and fully paid:** | | | | | | **Ordinary Shares of 6.7p each (2021: 0.67p)** | | | | | | Opening position | 54,089,447 | 36,240 | 54,089,447 | 36,240 | | Cancellation of shares | (3,400,830) | (228) | – | – | | Shares issued through share split | 486,805,023 | – | – | – | | **Closing position** | **537,493,640** | **36,012** | **54,089,447** | **36,240** | | **Total shares in issue** | **537,493,640** | **36,012** | **54,089,447** | **36,240** | At the Annual General Meeting of the Company held on 27 October 2021, shareholders approved a resolution for a ten for one share split such that each shareholder would receive ten shares with a nominal value of 6.7p each for every existing share held. These new shares were listed on 1 November 2021. During the year ended 31 May 2022, 3,275,830 ordinary shares were bought back in the market, to be held in Treasury (year ended 31 May 2021: nil) at a total cost, including stamp duty, of £10.0m. The 3,275,830 shares that were held in Treasury were subsequently cancelled prior to the end of May 2022. In addition, during the year ended 31 May 2022, 125,000 shares were bought back for cancellation (year ended 31 May 2021: nil), at a total cost, including stamp duty, of £0.3m. As a result, there were 537,493,640 ordinary shares in issue as at 31 May 2022 (of which none are held in Treasury; year to 31 May 2021: 54,089,447 ordinary shares and no Treasury shares). Each holder of ordinary shares is entitled, on a show of hands, to one vote and, on a poll, to one vote for each ordinary share held. Strategic Report Manager's Review Governance Financial Statements Other Information Panthesin International Plc Annual Report and Accounts 2022 | 161 ## Notes to the Financial Statements ### 15 Reserves | | Share premium €'000 | Capital redemption reserve €'000 | Other capital reserve €'000 | Capital reserve on investments held €'000 | Revenue reserve €'000 | | --- | --- | --- | --- | --- | --- | | Beginning of period | 269,535 | 3,325 | 976,685 | 679,736 | (100,290) | | Net gain on realisation of investments^{1} | – | – | 871,790 | – | – | | Decrease in unrealised appreciation | – | – | – | (5,077) | – | | Transfer on disposal of investments | – | – | – | 216 | – | | Revaluation of amounts owed in respect of transactions | – | – | (3) | – | – | | Exchange differences on currency | – | – | 19,709 | – | – | | Exchange differences on other capital items | – | – | (145) | – | – | | Legal and professional expenses charged to capital | – | – | (1,326) | – | – | | Share reorganisation and share buybacks | – | 228 | (10,364) | – | – | | Revenue return for the period | – | – | – | – | (12,567) | | **End of period** | **269,535** | **3,553** | **1,556,346** | **674,875** | **(112,857)** | 1. Reserves that are attributable by way of dividends. In addition, the Other Capital Reserves can be used for share buybacks. 2. Net gain on realisation of investments includes a realised gain of €172,987,000 following the transfer of several investment and fair value during the year, to its wholly owned subsidiary Pantheon International Holdings L.P. ### 16 Net Asset Value Per Share | | 31 May 2023 | 31 May 2021 | | --- | --- | --- | | Net assets attributable in €'000 | 2,427,464 | 1,865,231 | | Ordinary shares | 537,493,640 | 540,894,470^{1} | | Net asset value per ordinary share | 451.63p | 344.84p/ | 1. Restated to reflect the subsequent tax for one share split. Strategic Report Manager's Review Governance Financial Statements Other Information Pantheon International Plc Annual Report and Accounts 2022 | 102 Notes to the Financial Statements # 17 Subsidiaries The Company has formed three wholly owned subsidiaries, to provide security for future lending arrangement's Pantheon International Holdings LP ("PIH LP") was incorporated on 29 March 2021 with a registered address in the State of Delaware (National Registered Agents, Inc., 209 Orange Street, Wilmington, Delaware, 19801), and is wholly owned by the Company. The Company holds an investment in PIH LP. In accordance with FRS102, the Company is exempted from the requirement to prepare consolidated financial statements on the grounds that its subsidiary is held exclusively with a view to subsequent resale as it is considered part of an investment portfolio. The subsidiary's value to the Company is through fair value and it holds a basket of investments rather than to carry out business on the Company's behalf. Investments held within PIH LP are based on the fair value of the investments held in those entities. On 31 December 2021, the Company transferred several investments, at a fair value of £627.1m, to its wholly-owned subsidiary Pantheon International Holdings LP in order to provide security for the new £500m multi-currency facility agreed 2 August 2022. The aggregate amount of its capital and reserves as at 31 May 2022 is £820,890,000, and the profit or loss for the period ended 31 May 2022 is £164,000. The General Partner for PIH LP is Pantheon International Holdings GP Limited ("PIH GP"). PIH GP was incorporated on 17 March 2021 with a registered address c/o Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands, and is wholly owned by the Company. The Company is not exempt from consolidating the financial statements under FRS102, however the highly immaterial (£nil) balance of PIH GP Limited would produce accounts with almost identical balances to the Company. Furthermore, with reference to the CA, section 406 (2), "A subsidiary undertaking may be excluded from consolidation if its inclusion is not material for the purpose of giving a true and fair view". The aggregate amount of its capital and reserves as at 31 May 2022 is £1, and the profit or loss for the period ended 31 May 2022 is £nil. The General Partner and the Limited Partner formed an exempted limited partnership, named Pantheon International Holdings GP LP ("PIH GP LP"). PIH GP LP was incorporated on 17 March 2021 with a registered address c/o Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. The Company holds an investment in PIH GP LP. In accordance with FRS102, the Company is exempted from the requirement to prepare consolidated financial statements on the grounds that its subsidiary is held exclusively with a view to subsequent resale as it is considered part of an investment portfolio. Therefore, the Company's investment in PIH GP LP will be recognised at fair value through profit or loss. Any investments made by Company into PIH LP, generally invest at 99% directly into PIH LP, with the remaining 1% investing into PIH GP LP. PIH GP LP will then, in turn, wholly invest those funds into PIH LP, so no funds remain in PIH GP LP. Strategic Report Manager's Review Governance Financial Statements Other Information Pantheon International Plc Annual Report and Accounts 2022 183 ## Notes to the Financial Statements ### 18 Reconciliation of Return Before Financing Costs and Taxation to Net Cash Flow from Operating Activities | | 31 May 2022 £'000 | 31 May 2021 £'000 | | --- | --- | --- | | Return before finance costs and taxation | 579,639 | 305,920 | | Withholding tax (deducted)/recovered | (3,075) | 3,533 | | Gains on investments | (570,049) | (341,802) | | Currency (gains)/losses on cash and borrowings | (19,564) | 18,452 | | Increase in creditors | 483 | 215 | | (Increase)/decrease in other debtors | (29) | 3 | | Reduction of financial liabilities at fair value through profit or loss (ALN) | 3,428 | 12,547 | | Income, expenses and taxation associated with the ALN | (1,283) | (632) | | Net cash outflow from operating activities | (10,450) | (1,764) | ### 19 Contingencies, Guarantees and Financial Commitments At 31 May 2022 there were financial commitments outstanding of £755m (31 May 2021: £528m) in respect of investments in partly paid shares and interests in private equity funds. We expect 22% of the financial commitments outstanding to be called within the next twelve months. Further detail of the available finance cover is provided in Note 20. Strategic Report Manager's Review Governance Financial Statements Other Information Panthesin International Plc Annual Report and Accounts 2022 | 154 ## Notes to the Financial Statements ### 20 Analysis of Financial Assets and Liabilities The primary investment objective of the Company is to seek to maximise long-term capital growth for its shareholders by investing in funds specialising in unquoted investments, acquiring unquoted portfolios and participating directly in private placements. Investments are not restricted to a single market but are made when the opportunity arises and on an international basis. The Company's financial instruments comprise securities and other investments, cash balances and debtors and creditors that arise from its operations, for example sales and purchases awaiting settlement and debtors for accrued income. The principal risks the Company faces in its portfolio management activities are: - liquidity/marketability risk; - interest rate risk; - market price risk; and - foreign currency risk. The Company also has exposure to credit risk through its bank balances with the exposures being to banks with a minimum credit rating of A. The Manager monitors the financial risks affecting the Company on a daily basis, and the Directors regularly receive financial information, which is used to identify and monitor risk. In accordance with FRS 102, an analysis of financial assets and liabilities, which identifies the risk to the Company of holding such items, is given below. #### Liquidity Risk Due to the nature of the Company's investment policy, the largest proportion of the portfolio is invested in unquoted securities, many of which are less readily marketable than, for example, "blue-chip" UK equities. The Directors believe that the Company, as a closed ended fund with no fixed wind-up date, is ideally suited to making long-term investments in instruments with limited marketability. The investments in unquoted securities are monitored by the Board on a regular basis. There are times when opportunities for the Company to acquire secondary unquoted portfolios of interests or co-investments may be limited due to the cyclical nature of their occurrence. As a result, at times of low investment opportunity, some funds may be held on deposit or invested in gifts and other fixed interest government bonds. It is the nature of investment in private equity that a commitment (see Note 19 for outstanding commitments as at 31 May 2022) to invest will be made and that calls for payments will then be received from the unlisted investee entity. These payments are usually on an ad-hoc basis and may be called at any instance over a number of years. The Company's ability to meet these commitments is dependent upon it receiving cash distributions from its private equity investments and, to the extent these are insufficient, on the availability of financing facilities. On 1 June 2018, the Company agreed a four-year £175m multi-currency revolving credit facility agreement, arranged by Lloyds Bank and NatWest Markets. This was further extended to £300m on 31 May 2020. This replaced the £180m loan facility agreement which was due to expire in November 2018, of which £nil was drawn down as at 31 May 2022 and 31 May 2021. (see Note 6 for further information). In February 2021, the Company further agreed an extension to the facility end date to 31 May 2024. The principal covenant that applies to the loan facility is that gross borrowings do not exceed 30% of adjusted gross asset value. The facility is available should the Company have the requirement to cover any shortfalls in meeting its commitments. Total available financing as at 31 May 2022 stood at £528m (31 May 2021: £475m), comprising £227m (31 May 2021: £198m) in cash balances and £501m (31 May 2021: £277m) (sterling equivalent) in undrawn bank facilities. The available financing along with the private equity portfolio exceeded the outstanding commitments by 3.71m as (31 May 2021: 4.15m). On 2 August 2022, the Company announced that it has agreed a new five-year £500m multi-transfer, multi-currency revolving credit facility agreement arranged by Credit Suisse AG London Branch, Lloyds Bank Corporate Markets plc and State Street Bank International GmbH. The Loan Facility, which replaced the £300m loan facility agreement, which was due to expire in May 2024, is comprised of facilities amounting to $512.5m and 489.2m and secured by certain assets of the Company. The new facility will expire in July 2027 with an ongoing option to extend, by agreement, the maturity date by another year at a time. The new facility will have a blended commitment fee of 0.95% per annum on available commitment and pricing equivalent to the relevant benchmark rate plus 2.390% to 2.575% depending on utilisation. The principal covenants that apply to the loan facility require: (i) that gross borrowings do not exceed 34% of the borrowing base; (ii) that gross borrowings do not exceed 45% of the adjusted borrowing base in the first year of the facility, and 40% thereafter; and (iii) the liquidity ratio does not exceed 3.0x undrawn commitments. #### Interest Rate Risk The Company may use gearing to achieve its investment objectives and manage cash flows and uses a multi-currency revolving credit facility for this purpose. Interest on the revolving credit facility is payable at variable rates determined subject to drawdown. Variable rates are defined as RFR, dependent on the currency drawn. The interest rate is then fixed for the duration that the loan is drawn down. At 31 May 2022, there was the sterling equivalent of £nil funds drawn down on the loan facilities (31 May 2021: £nil). A commitment fee of 0.94% per annum is payable in respect of the amounts available for drawdown in each facility. Strategic Report Manager's Review Governance Financial Statements Other Information Parkheon International Plc Annual Report and Accounts 2022 | 185 ![img-5.jpeg](img-5.jpeg) ### Notes to the Financial Statements 20   The remainder of the Company’s portfolio and current assets are not subject to interest rate risks.   Fixed interest | | | | No | Matures | Matures | | average | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | maturity | | within | | after | interest | | | | Total | | date | 1 year | | 1 year | | rate | | 31 May 2022 | £’000 | | £’000 | £’000 | | £’000 | |  |  Sterling 891,350 891,350 – – – US dollar 1,262,083 1,262,083 – – – Euro 269,786 269,786 – – – Other 47,4 4 6 47,4 46 – – – 2,470,665 2,470,665 – – –  Fixed interest | | | | No | Matures | Matures | | average | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | maturity | | within | | after | interest | | | | Total | | date | 1 year | | 1 year | | rate | | 31 May 2021 | £’000 | | £’000 | £’000 | | £’000 | |  |  Sterling 74,668 74,668 – – – US dollar 1,428,217 1,428,217 – – – Euro 356,593 356,593 – – – Other 53,364 53,364 – – – 1,912,842 1,912,842 – – – Financial Statements Pantheon International Plc 186 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts ## Notes to the Financial Statements ### 20 Analysis of Financial Assets and Liabilities #### Financial Liabilities At 31 May 2022, the Company had drawn the sterling equivalent of £ml (31 May 2021: £ml) of its committed revolving multi-currency credit facility, expiring 31 May 2024, with Lloyds Bank and Natwest Markets. Interest is incurred at a variable rate as agreed at the time of drawdown and is payable at the maturity date of each advance. At the year end, interest of £ml (31 May 2021: £ml) was accruing as the facilities were unutilised. At 31 May 2022 and 31 May 2021, other than the ALN, all financial liabilities were due within one year and comprised short-term creditors. The ALN is repayable by no later than 31 August 2027. #### Market Price Risk The method of valuation of the fixed asset investments is described in Note 1 (D) on page 168. The nature of the Company's fixed asset investments, with a high proportion of the portfolio invested in unquoted securities, means that the investments are valued by the Directors after due consideration of the most recent available information from the underlying investments. PIP's portfolio is well diversified by the sectors in which the underlying companies operate. This sectoral diversification helps to minimise the effects of cyclical trends within particular industry segments. If the investment portfolio fell by 20% from the 31 May 2022 valuation, with all other variables held constant, there would have been a reduction of £447,722,000 (31 May 2021: £342,745,000) in the return before taxation. An increase of 20% would have increased the return before taxation by an equal and opposite amount. #### Foreign Currency Risk Since it is the Company's policy to invest in a diverse portfolio of investments based in a number of countries, the Company is exposed to the risk of movement in a number of foreign exchange rates. A geographical analysis of the portfolio and hence its exposure to currency risk is given on page 30 and in Note 9b. Although it is permitted to do so, the Company did not hedge the portfolio against the movement in exchange rates during the financial period. The investment approach and the Manager's consideration of the associated risk are discussed in further detail in the Strategic Report on pages 46 to 49 and the Manager's Review on pages 57 to 69. The Company settles its transactions from its bank accounts at an agreed rate of exchange at the date on which the bargain was made. As at 31 May 2022, realised exchange losses of £145,000 (31 May 2021: losses of £63,000) and realised gains relating to currency of £19,709,000 (31 May 2021: realised losses of £18,389,000) have been taken to the capital reserve. The Company's exposure to foreign currency excluding private equity investments is shown below. In relation to this exposure, if the sterling/dollar and sterling/euro exchange rate had reduced by 10% from that obtained at 31 May 2022, it would have the effect, with all other variables held constant, of increasing equity shareholders' funds by £21,936,000 (31 May 2021: £20,497,000). If there had been an increase in the sterling/dollar and sterling/euro exchange rate of 10% it would have the effect of decreasing equity shareholders' funds by £17,948,000 (31 May 2021: £16,770,000). The calculations are based on the financial assets and liabilities and the exchange rate as at 31 May 2022 of 1.26 (31 May 2021: 1.42155) sterling/dollar and 1.17625 (31 May 2021: 1.16255) sterling/euro. The Company's investment currency exposure is disclosed in Note 9b. Strategic Report Manager's Review Governance Financial Statements Other Information Panthesin International Plc Annual Report and Accounts 2022 | 187 ### Notes to the Financial Statements 20  An analysis of the Company’s exposure to foreign currency is given below: | 31 May 2022 | | 31 May 2022 | | | 31 May 2021 | | 31 May 2021 | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | Assets | | Liabilities | | | Assets | | Liabilities | | | | £’000 | | | £’000 | | £’000 | | | £’000 | US dollar 176,090 497 166,058 455 Canadian dollar 1,375 – 18 – Euro 22,036 201 19,071 203 Swedish krone 240 – 3,219 – Norwegian krone 136 – 1,712 – Australian dollar 13,236 – 7, 4 80 – 213,113 698 197,55 8 658   held at fair value. Managing Capital The Company’s equity comprises ordinary shares as described in Note 14. Capital is managed so as to maximise the return to shareholders while maintaining a capital base that allows the Company to operate effectively in the marketplace and sustain future development of the business. The Company considers its capital to be comprised of called up share capital and net available cash. As at 31 May 2022 and 31 May 2021, the Company had bank debt facilities to increase the Company’s liquidity. Details of available borrowings at the period end can be found earlier in this Note. The Company’s assets and borrowing levels are reviewed regularly by the Board of Directors with reference to the loan covenants. The Company’s capital requirement is reviewed regularly by the Board of Directors. Financial Statements Pantheon International Plc 188 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts ### Notes to the Financial Statements 21  22   The amounts paid to the Manager, together with the details of the Investment Management multi-tranche, multi-currency revolving credit facility agreement arranged by Credit Suisse AG Agreement, are disclosed in Note 3. The existence of an Independent Board of Directors London Branch, Lloyds Bank Corporate Markets plc and State Street Bank International GmbH.  The Loan Facility, which replaced the £300m loan facility agreement, which was due to expire and therefore, under the AIC SORP, the Manager is not considered to be a related party. in May 2024, is comprised of facilities amounting to $512.9m and €89.2m and secured by The Company’s related parties are its Directors and Fees paid to the Company’s Board are certain assets of the Company. The new facility will expire in July 2027 with an ongoing option disclosed in the Directors’ Remuneration Report on pages 150 to 152. to extend, by agreement, the maturity date by another year at a time. The new facility will  The Company has also formed three wholly-owned subsidiaries. Please see note 17 for  further details. The Company also holds an investment in PSOF. Please see page 67 for The principal covenants that apply to the loan facility require: (i) that gross borrowings do not further details.    ratio does not exceed 3.0x undrawn commitments. Financial Statements Pantheon International Plc 189 2022 Strategic Report Manager’s Review Governance Other Information Annual Report and Accounts ## Other Information AIFMD Disclosures 191 Alternative Performance Measures 193 Glossary of Terms 197 Directors and Advisers 199 Other Information Other Information Pantheon International Plc 190 Pantheon International Plc 190 2022 2022 Strategic Report Manager’s Review Governance Financial Statements Strategic Report Manager’s Review Governance Financial Statements Annual Report and Accounts Annual Report and Accounts ## AIFMD Disclosures The Company is an alternative investment fund ("AIF") for the purposes of the Alternative Investment Fund Managers Directive (Directive 2011/61/EU) ("AIFMD"), and the Manager was appointed as its alternative investment fund manager ("AIFM") for the purposes of the AIFMD with effect from 21 July 2014. The Manager is a "full scope" AIFM for the purposes of the AIFMD. The AIFMD requires certain disclosures to be made in the Annual Report of the Company. Many of these disclosures were already required by the Listing Rules and/or UK Accounting Standards, and these continue to be presented in other sections of the Annual Report, principally the Strategic Report (pages 2 to 55), the Manager's Review (pages 57 to 131) and the financial statements (pages 163 to 189). This section completes the disclosures required by the AIFMD. ### Assets subject to special arrangements The Company holds no assets subject to special arrangements arising from their illiquid nature. ### Remuneration disclosure The total number of staff of the Manager for the period ended 31 May 2022, including staff remunerated by affiliates of the Manager, was approximately 400, of which 8 were senior management or other members of staff whose actions have a material impact on the risk profile of the Company ("identified staff"). The total remuneration paid by the Manager and its affiliates to staff of the Manager in respect of the financial year ended 31 May 2022 attributable to work relating to the Company was as follows: | | 12 months to 31 May 2022 | | | 12 months to 31 May 2021 | | | | --- | --- | --- | --- | --- | --- | --- | | | Fixed £'000 | Variable £'000 | Total £'000 | Fixed £'000 | Variable £'000 | Total £'000 | | Senior management | 518 | 795 | 1,313 | 440 | 526 | 966 | | Staff | 1,727 | 1,062 | 2,789 | 1,108 | 698 | 1,807 | | **Total staff** | **2,245** | **1,857** | **4,102** | **1,548** | **1,225** | **2,773** | | Identified staff | 322 | 434 | 786 | 296 | 351 | 647 | No carried interest was paid in respect of the Company during the year. The above disclosures reflect only that element of the individuals' remuneration which is attributable to the activities of the Manager relating to the Company. It is not possible to attribute remuneration paid to individual staff directly to income received from any fund and hence the above figures represent a notional approximation only calculated by reference to the assets under management of the Company as a proportion of the total assets under management of the Pantheon Group. In determining the remuneration paid to its staff, the Manager takes into account a number of factors including the performance of the Company, the Manager and each individual member of staff. These factors are considered over a multi-year framework and include whether staff have met the Manager's compliance standards. In addition, the Manager seeks to ensure that its remuneration policies and practices align financial incentives for staff with the risks undertaken and results achieved by investors, for example by ensuring that a proportion of the variable income received by identified staff is deferred for a period of at least three years. Full details of the Pantheon Group's remuneration policies and practices for staff (which includes the Manager's staff) can be found at www.pantheon.com. Strategic Report Manager's Review Governance Financial Statements Other Information Pantheon International Plc Annual Report and Accounts 2022 | 191 ### AIFMD Disclosures Leverage  The AIFMD requires the Manager of the Company to set leverage limits for the Company. The principal risks to which the Company is exposed and the approach to managing those For the purposes of the AIFMD, leverage is any method by which the Company’s exposure is  increased, whether through the borrowing of cash or by the use of derivatives or by any other statements (pages 185 to 188). The investment restrictions which seek to mitigate some means. The AIFMD requires leverage to be expressed as a ratio between the Company’s   investment policy (page 37) and under “Board responsibilities and relationship with the the commitment method (as set out in Commission Delegated Regulation No. 231/2013), Manager” in the Statement on Corporate Governance (page 142). Additionally, the individual  counterparty exposure limit for deposits with each of the Company’s bank counterparties has been set at £70m or the equivalent in foreign currencies. The Manager’s risk management The following leverage limits have been set for the Company: system incorporates regular review of the principal risks facing the Company and the   investment restrictions applicable to the Company. The Manager has established appropriate amount as is agreed from time to time with the Company’s lenders. internal control processes to mitigate the risks, including those described in the “Mitigation” column in the “Risk Management and Principal Risks” section of the Strategic Report (ii) Leverage calculated as the ratio between the exposure of the Company calculated in  accordance with the gross method referred to above and its net asset value shall not year to 31 May 2022.   (iii) Leverage calculated as the ratio between the exposure of the Company calculated in accordance with the commitment method referred to above, and its net asset value The AIFMD requires certain information to be made available to investors in the Company  before they invest and requires that material changes to this information be disclosed in the Annual Report of the Company. The information required to be disclosed is contained Using the methodologies prescribed under the AIFMD, the Company’s leverage as at 31 May in the document “Information for Investors”, which is available on the Company’s website 2022 is shown below: at www.piplc.com. Gross Commitment There have been no material changes to this information requiring disclosure. method method Leverage ratio   There have been no changes to the maximum level of leverage which the Manager may  collateral or asset reuse arrangements in place as at the year end. Other Information Pantheon International Plc 192 2022 Strategic Report Manager’s Review Governance Financial Statements Annual Report and Accounts ### Alternative Performance Measures   under IFRS and are therefore termed “APMs”. The APMs that we use may not be directly Call to limited partners (“LPs”) to pay in a portion of the LPs’ committed capital when the comparable with those used by other companies. The APMs used by the Company are   Year ended Year ended  | | | | 31 May 2022 | | 31 May 2021 | | | --- | --- | --- | --- | --- | --- | --- | |  | | Page | | £m | | £m | |  | Acquisitions at cost 176 980 226 (a) | | | | | | Recallable distributions (25) (29) (b) Year ended Year ended 31 May 2022 31 May 2021 Amount drawn for new commitments (160) (76) (c) Page £’000 £’000 ALN share of calls – (1) (d) Investment management fees 171 23,115 18,544 PIH LP Investment (720) – (e) Lookthrough charges 862 352 Investments made through PIH LP 112 – (f) Other expenses 172 1,274 1,417  187 120 (a + b + c +  25,251 20,313 (a) d + e + f) Average month-end NAV 2,195,124 1,668,186 (b)    (a/b)  Capital calls in the period divided by opening undrawn commitments.  Year ended Year ended Cash and net current assets (liabilities) less next ALN repayment (see Notes 11 and 12). 31 May 2022 31 May 2021 £m £m  Capital calls 187 120 (a) Sum of available cash and undrawn loan facility. Opening undrawn commitments 528 541 (b) At 31 May At 31 May    (a/b) 2022 2021 Page £m £m Available cash 185 227 198 (a) Undrawn loan facility 185 301 277 (b)  528 475 (a + b) Other Information Pantheon International Plc 193 2022 Strategic Report Manager’s Review Governance Financial Statements Annual Report and Accounts ### Alternative Performance Measures Portfolio Investment Return Distribution Total movement in the valuation of the underlying funds and companies comprising the Cash or stock returned to the LPs after the fund has exited from an investment by selling it, portfolio, expressed as a percentage of opening portfolio value. Foreign exchange effects and or from distributions received before a sale. Excludes such proceeds received relative to the  portion of the portfolio attributable to the ALN. the ALN. A reconciliation of the return after taxation to the portfolio valuation movement is Year ended Year ended shown below. | | | | | | | | 31 May 2022 | | 31 May 2021 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | Page | | £m | | £m | | | Year ended | | Year ended | | | | | | | | | | 31 May 2022 | | 31 May 2021 | | Disposal of investments 176 1,025 350 (a) | | | | | | | Page | | £m | | £m | | | | | | | Investment income received 163 19 16 (b)  Recallable distributions (25) (27) (c)  163 573 306 (a) Withholding tax deducted (3) 4 (d) Adjusted for non-portfolio income | and expenses | ALN share of distributions (11) (24) (e) | | --- | --- | | – Investment management fees 163 23 19 (b) | Transferred investments to PIH LP 176 (627) – (f) | | – Other expenses 163 3 3 (c) | Disposals of investments received | through PIH LP 41 – (g) – Interest payable and similar expenses 163 4 3 (d) Distributions from PIP's portfolio 419 319 (a + b + c + – Portfolio and other FX * (166) 186 (e) d + e + f + g) Portfolio valuation movement 436 517 (g) = (a) + (b) + (c) + (d) + (e) Distribution rate Distributions for the period divided by opening portfolio value. Opening investments at fair value 165 1,714 1,496 (h) Year ended Year ended ALN share of opening investments (47) (58) (i) 31 May 2022 31 May 2021 Opening portfolio value Page £m £m  1,667 1,438 (j) = (h) + (i) Distributions from PIP’s portfolio 419 319 (a) Opening investments at fair value 165 1,714 1,496 (b) Portfolio Investment Return   (g/j) ALN share of opening investments (47) (58) (c) * Includes £165m of FX on the portfolio excluding the ALN (2021: (£165m)). Opening portfolio value (excluding the ALN) 1,667 1,438 (d) = (b + c) Distribution rate from PIP’s portfolio   (a/d) Other Information Pantheon International Plc 194 2022 Strategic Report Manager’s Review Governance Financial Statements Annual Report and Accounts # Alternative Performance Measures ## Financing cover Ratio of available cash, private equity assets and undrawn loan facility to outstanding commitments. Future calls from outstanding commitments are expected to be funded from future distributions realised from the existing private equity assets portfolio, in addition to distributions realised from future investments. | | Page | At 31 May 2022 £m | At 31 May 2021 £m | | | --- | --- | --- | --- | --- | | Available financing | 193 | 528 | 475 | (a) | | Investments at fair value | 165 | 2,239 | 1,714 | (b) | | Total | | 2,767 | 2,189 | (c) = (a + b) | | Outstanding commitments | | 755 | 528 | (d) | | Financing cover | | 3.7x | 4.1x | (c/d) | ## Net portfolio cash flow Income and capital distributions received from funds following exit realisations less capital calls made to finance investments or expenses. | | Year ended 31 May 2022 £m | Year ended 31 May 2021 £m | | | --- | --- | --- | --- | | Distributions from PIP's portfolio | 419 | 319 | (a) | | Capital calls | 187 | 130 | (b) | | Net portfolio cash flow | 232 | 199 | (a-b) | ## Sample calculations and disclosures The sample buyout figures for the 12 months to 31 December 2021 were calculated using all the information available to the Company. The figures are based on unaudited data. MSCI data was sourced from Bloomberg. ## Revenue and EBITDA The revenue and EBITDA figures were based upon the last 12 months to 31 December 2021 or, where not available, the closest annual period disclosed, and provide coverage of 52% and 81% (12 months to 2020: 68% and 69%) for revenue and EBITDA growth respectively of PIP's buyout portfolio. Individual company revenue and EBITDA growth figures were capped if in excess of -100% and +100% to avoid distortions from large outliers. Sample data for 2016–2021 is based on the same methodology and provides coverage of 43%–75% of the portfolio in each year. ## Valuation multiple and debt multiple Enterprise value is defined as equity value plus net debt. The net debt and enterprise value figures were based on underlying valuations as at 31 December 2021, or the closest disclosed period end. The valuation multiple sample covers approximately 65% (2020: 54%) of PIP's buyout portfolio. The debt multiple sample covers approximately 52% (2020: 68%) of PIP's buyout portfolio. ## Cost multiple The cost multiple data on page 85 is based on a sample that represented approximately 68% by value of proceeds from exit realisations for the year to 31 May 2022. The data covers primary investments and co-investments, and is based upon gross cost multiples available at the time of the distribution. ## Uplift Realisation events are classified as exit realisations when proceeds equate to at least 80% of total investment value and once confirmation of exit realisation is received from the underlying private equity manager. Uplift on full exit compares the value received upon realisation against the investment's carrying value 12 months prior to the transaction taking place. The analysis on page 86 only includes exit realisations that occurred during the period and disregards the impact of any proceeds received outside the 12-month period covered in the uplift analysis. The data in the sample represents 100% (2021: 100%) of proceeds from exit realisations and 87% (2021: 74%) of distributions received during the period. Strategic Report Manager's Review Governance Financial Statements Other Information Pantheon International Plc Annual Report and Accounts 2022 95 ### Alternative Performance Measures   Pantheon but excluding taxes, expressed as a percentage of the average month-end NAV over the year. | | Year ended | | Year ended | | | --- | --- | --- | --- | --- | | | 31 May 2022 | | 31 May 2021 | | | Page | | £m | | £m | Investment management fees 171 23,115 18,544 Performance fee payable to Pantheon – – Lookthrough charges 862 352 Other expenses 172 1,274 1,417 Interest payable and similar expenses 163 3,967 3,488  29,218 23,801 (a) Average month-end NAV 2,195,124 1,668,186 (b)    (a/b)     | | At 31 May | | At 31 May | | | --- | --- | --- | --- | --- | | | | 2022 | | 2021 | | Page | | £m | | £m |  193 528 475 (a)  165 224 171 (b)  752 646 (c) = (a + b) Undrawn commitments 755 528 (d)    (c/d) Other Information Pantheon International Plc 196 2022 Strategic Report Manager’s Review Governance Financial Statements Annual Report and Accounts ### Glossary of Terms   Alternative Investment Fund Managers Directive. A pro rata share of the Company’s Total Ongoing Charges allocated to the ALN, reducing each quarterly payment. This is deducted from Other expenses through the revenue account of the  Income Statement. Unlisted, subordinated note due August 2027, the repayment and the performance of which  are linked to a reference portfolio consisting of older vintage funds. The holder of the ALN  An investment vehicle, often a limited partnership, that pools capital commitments of repayment of any outstanding balance in August 2027. investors and invests or “feeds” such capital into an umbrella fund, often called a master fund (“Master”), which directs and oversees all investments held in the Master portfolio.   Funds that acquire controlling interests in companies with a view towards later selling those companies or taking them public. Private equity fund that invests in a portfolio of several private equity funds to achieve,  Carried interest private equity manager risk.   Co-investment Annual fee, typically charged by the GP as a percentage of LP commitments to the fund during Direct shareholding in a company by invitation alongside a private equity fund. the investment period and attenuating thereafter, intended to cover the costs of running and administering a fund. Commitment  The amount of capital that each Limited Partner agrees to contribute to the fund when and as called by the General Partner. The entity managing a private equity fund that has been established as a limited partnership, also commonly referred to as the private equity fund manager. Debt multiple  Ratio of net debt to EBITDA.  Dry powder  Capital raised and available to invest but not yet deployed. The IRR, a common measure of private equity performance, is calculated as an annualised   A measure of earnings before interest and taxes that excludes non-cash expenses. Valuation Investment period methods are commonly based on a comparison of private and public companies’ value as a multiple of EBITDA.    The sum of a company’s market capitalisation and net debt (net debt equals debt less cash  and cash equivalents).  portfolio companies mature and are exited.  Realisation of an investment usually through trade sale, sale by public offering (including IPO),  Other Information Pantheon International Plc 197 2022 Strategic Report Manager’s Review Governance Financial Statements Annual Report and Accounts ### Glossary of Terms   An institution or individual who commits capital to a private equity fund established as a Privately negotiated investments typically made in non-public companies. limited partnership. Limited partners are generally protected from legal actions and any  losses beyond their original commitment to the fund.   substantially comprising the Company’s oldest funds (2006 and earlier vintages).    Purchase of existing private equity fund or company interests and commitments from an Purchase of an interest in a portfolio company alongside a private equity manager, where investor seeking liquidity in such funds or companies. the manager is seeking to extend the investment holding period in order to participate in the  company’s next phase of growth. Occurs when a company’s share price is higher (lower) than the NAV per share.   Share price multiplied by the number of shares outstanding. Special situations investments can include distressed debt, mezzanine, energy/utilities and  turnarounds. A common measure of private equity performance, MOIC is calculated by dividing the fund’s  cumulative distributions and residual value by the paid-in capital. Capital that is committed but is still to be drawn down by the GP for investment.    investor’s attributable holding. Increase in value received upon exit realisation of an investment relative to its carrying value 12 months prior to realisation.  Valuation multiples Cash and net current assets (liabilities) less next ALN repayment (see Notes 12 and 13). Multiple of earnings (typically EBITDA or net income) or revenue applied in valuing a business  enterprise. Cumulative amount of capital that has been called.    A company that is an investment within a private equity fund. product and market development. Portfolio investment return Vintage Total movement in the valuation of the underlying funds and companies comprising the portfolio,  expressed as a percentage of opening portfolio value. Foreign exchange effects and other Weighted average fund age  Average fund age for the portfolio is weighted by the fund’s respective closing net asset Primaries  Commitments made to private equity funds at the time such funds are formed. Other Information Pantheon International Plc 198 2022 Strategic Report Manager’s Review Governance Financial Statements Annual Report and Accounts ### Directors and Advisers |  |  | | --- | --- | | Sir Laurie Magnus CBE (Chair) | Investec Bank plc | | John Burgess | 30 Gresham Street | | David Melvin | London | | Dame Susan Owen DCB | EC2V 7QP | Mary Ann Sieghart Depositary John Singer BNP Paribas Trust Corporation UK Limited Manager 10 Harewood Avenue Pantheon Ventures (UK) LLP London Authorised and regulated by the FCA NW1 6AA 10 Finsbury Square Registrar 4th Floor London Link Market Services EC2A 1AF 10th Floor Central Square Email: pip.ir@pantheon.com 29 Wellington Street PIP website: www.piplc.com Leeds Pantheon website: www.pantheon.com LS1 4DL LinkedIn: www.linkedin.com/company/pantheon-international-plc Telephone: +44 (0)371 664 0300   Link Alternative Fund Administrators Limited Morgan, Lewis & Bockius UK LLP Beaufort House Condor House 51 New North Road 5–10 St Paul’s Churchyard Exeter London EX4 4EP EC4M 8AL Telephone: 01392 477500  Auditor Monfort Communications Ernst & Young LLP 2nd Floor 25 Churchill Place Berkeley Square House London Berkeley Square E14 5EY London W1J 6BD Other Information Pantheon International Plc 199 2022 Strategic Report Manager’s Review Governance Financial Statements Annual Report and Accounts   the Company’s Annual Reports, Notices of Meetings and other formal communications are available on the Company’s website, instead of  the reduction of paper, printing, energy and water usage, as well as  electronic communications from the Company and wish to do so, visit www.signalshares.com. To register, you will need your investor code,   Alternatively, you can contact Link’s Customer Support Centre, which is available to answer any queries you have in relation to your shareholding: By phone: call +44 (0)371 664 0300. Calls from outside the UK will be charged at the applicable international rate. Link is open between 09:00 and 17:30, Monday to Friday (excluding public holidays in England and Wales). By email: shareholder.enquiries@linkgroup.co.uk By post: Link Group, 10th Floor, Central Square, 29 Wellington Street, Designed and produced by  Leeds, LS1 4DL, UK www.friendstudio.com Registered in England ### Pantheon Telephone number: 2147984 +44 (0)20 3356 1800 ###  A member of the Association 10 Finsbury Square ###  of Investment Companies 4th Floor pip.ir@pantheon.com London PIP is a founding member of ### EC2A 1AF Website United Kingdom www.piplc.com Other Information Pantheon International Plc 201 2022 Strategic Report Manager’s Review Governance Financial Statements Annual Report and Accounts