HarbourVest Private Equity Regulatory News (HVPE)

28 May 2021

RESULTS FOR THE YEAR ENDED 31 JANUARY 2021

Record net asset value ("NAV") per share growth through an unprecedented period

HarbourVest Global Private Equity Limited ("HVPE" or the "Company"), today announces its audited results for the year ended 31 January 2021.

Highlights - Year to 31 January 2021

· Increase in NAV per share of 30.4% to $35.97 (31 January 2020: $27.58)

· Largest 12-month NAV per share increase in HVPE's 13-year history

· Strong rebound in the middle of the year recovered Q1 pandemic-driven declines

· Weighting to venture and growth equity investments, in particular technology, a key performance driver

· Represents outperformance of the FTSE All World Total Return Index of 4.0% on an annualised basis since inception

· Net investor during period

· A net $141.4 million cash invested (2020: $16.0 million)

· Total of $289.5 million cash distributions received (2020: $308.2 million)

· Total of $430.9 million capital calls paid (2020: $324.2 million)

· Record level of calls and distributions in cash terms from HarbourVest funds in December 2020, following strong investment and exit activity

· Successful navigation of COVID-19 environment

· Commitment plan re-commenced in Q4 following pause from April 2020

· Credit facility $120.0 million drawn at 31 January 2021, with a further $480.0 million available as required

· Year-end cash balance of $98.4 million (2020: $130.6 million)

· Encouraging trends post period end as global economies begin to reopen

· NAV per share of $36.62 at 30 April 2021, a 1.8% increase from 31 January 2021

· Cash flows have returned to trend, while the number of liquidity events in the portfolio has increased in recent months

Ed Warner, Chair of HVPE, said:

"I am pleased to report that HVPE's NAV per share increased by 30.4% over 12 months, a record growth figure made even more impressive by the turbulent backdrop. This reflects the expertise of our Investment Manager and the robust nature of HVPE's structure.

"I would like to thank shareholders for their support throughout the pandemic. We now look forward with cautious optimism, confident that HVPE is well-placed to deliver a long-term private markets solution to investors otherwise unable to access the many high-quality and exciting private companies that are our investment focus."

Investor Event

There will be a presentation for institutional and retail investors on 10 June 2021 at 11am BST. To receive registration details for the event, please contact Liah Zusman: hvpeevents@harbourvest.com.

Annual Report and Accounts

To view the Annual Report and Accounts please follow this link: Annual Report - Year Ending 31 January 2021. Page number references in this announcement refer to pages in this report. The Annual Report and Accounts will also shortly be available on the National Storage Mechanism, which is located at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

Annual Results Presentation

HVPE will publish a new presentation on its website to supplement the publication of the Annual Results for the 12 months ended 31 January 2021. The presentation will be publicly disclosed at 11am today. All stakeholders will be able to view and download the presentation from HVPE's website: www.hvpe.com.

Enquiries:

Notes to Editors:

About HarbourVest Global Private Equity Limited:

HarbourVest Global Private Equity Limited ("HVPE" or the "Company") is a Guernsey-incorporated, closed-end investment company which is listed on the Main Market of the London Stock Exchange and is a constituent of the FTSE 250 index. HVPE is designed to offer shareholders long-term capital appreciation by investing in a private equity portfolio diversified by geography, stage of investment, vintage year, and industry. The Company invests in and alongside HarbourVest-managed funds which focus on primary fund commitments, secondary investments and direct co-investments in operating companies. HVPE's investment manager is HarbourVest Advisers L.P., an affiliate of HarbourVest Partners, LLC, an independent, global private markets asset manager with more than 35 years of experience.

About HarbourVest Partners, LLC:

HarbourVest is an independent, global private markets asset manager with over 35 years of experience and more than $76 billion in assets under management, as of March 31, 2021. The Firm's powerful global platform offers clients investment opportunities through primary fund investments, secondary investments, and direct co-investments in commingled funds or separately managed accounts. HarbourVest has more than 700 employees, including more than 155 investment professionals across Asia, Europe, and the Americas. This global team has committed more than $46 billion to newly-formed funds, completed over $29 billion in secondary purchases, and invested over $21 billion directly in operating companies. Partnering with HarbourVest, clients have access to customised solutions, longstanding relationships, actionable insights, and proven results.

This announcement is for information purposes only and does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in any jurisdiction and should not be relied upon in connection with any decision to subscribe for or acquire any Shares. In particular, this announcement does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States or to US Persons (as defined in Regulation S under the US Securities Act of 1933, as amended ("US Persons")). Neither this announcement nor any copy of it may be taken, released, published or distributed, directly or indirectly to US Persons or in or into the United States (including its territories and possessions), Canada, Australia or Japan, or any jurisdiction where such action would be unlawful. Accordingly, recipients represent that they are able to receive this announcement without contravention of any applicable legal or regulatory restrictions in the jurisdiction in which they reside or conduct business. No recipient may distribute, or make available, this announcement (directly or indirectly) to any other person. Recipients of this announcement should inform themselves about and observe any applicable legal requirements in their jurisdictions.

The Shares have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States and, accordingly, may not be offered, sold, resold, transferred, delivered or distributed, directly or indirectly, within the United States or to US Persons. In addition, the Company is not registered under the US Investment Company Act of 1940, as amended (the "Investment Company Act") and shareholders of the Company will not have the protections of that act. There will be no public offer of the Shares in the United States or to US Persons.

This announcement has been prepared by the Company and its investment manager, HarbourVest Advisers L.P. (the "Investment Manager"). No liability whatsoever (whether in negligence or otherwise) arising directly or indirectly from the use of this announcement is accepted and no representation, warranty or undertaking, express or implied, is or will be made by the Company, the Investment Manager or any of their respective directors, officers, employees, advisers, representatives or other agents ("Agents") for any information or any of the opinions contained herein or for any errors, omissions or misstatements. None of the Investment Manager nor any of their respective Agents makes or has been authorised to make any representation or warranties (express or implied) in relation to the Company or as to the truth, accuracy or completeness of this announcement, or any other written or oral statement provided. In particular, no representation or warranty is given as to the achievement or reasonableness of, and no reliance should be placed on any projections, targets, estimates or forecasts contained in this announcement and nothing in this announcement is or should be relied on as a promise or representation as to the future.

Epidemics, Pandemics and Other Health Risks - Many countries have experienced infectious illnesses in recent decades, including swine flu, avian influenza, SARS and 2019-nCoV (the "Coronavirus"). In December 2019, an initial outbreak of the Coronavirus was reported in Hubei, China. Since then, a large and growing number of cases have been confirmed around the world. The Coronavirus outbreak has resulted in numerous deaths and the imposition of both local and more widespread "work from home" and other quarantine measures, border closures and other travel restrictions causing social unrest and commercial disruption on a global scale. The World Health Organization has declared the Coronavirus outbreak a pandemic. The ongoing spread of the Coronavirus has had and will continue to have a material adverse impact on local economies in the affected jurisdictions and also on the global economy as cross-border commercial activity and market sentiment are increasingly impacted by the outbreak and government and other measures seeking to contain its spread. In addition to these developments having potentially adverse consequences for underlying portfolio investments of the HarbourVest funds and the value of the investments therein, the operations of HVPE, the Investment Manager, and HVPE's portfolio of HarbourVest funds have been, and could continue to be, adversely impacted, including through quarantine measures and travel restrictions imposed on personnel or service providers based around the world, and any related health issues of such personnel or service providers. Any of the foregoing events could materially and adversely affect the Investment Manager's ability to source, manage and divest its investments and its ability to fulfil its investment objectives. Similar consequences could arise with respect to other comparable infectious diseases. 

Other than as required by applicable laws, the Company gives no undertaking to update this announcement or any additional information, or to correct any inaccuracies in it which may become apparent and the distribution of this announcement. The information contained in this announcement is given at the date of its publication and is subject to updating, revision and amendment. The contents of this announcement have not been approved by any competent regulatory or supervisory authority.

This announcement includes statements that are, or may be deemed to be, "forward looking statements". These forward looking statements can be identified by the use of forward looking terminology, including the terms "believes", "projects", "estimates", "anticipates", "expects", "intends", "plans", "goal", "target", "aim", "may", "will", "would", "could", "should" or "continue" or, in each case, their negative or other variations or comparable terminology. These forward looking statements include all matters that are not historical facts and include statements regarding the intentions, beliefs or current expectations of the Company. By their nature, forward looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future and may be beyond the Company's ability to control or predict. Forward looking statements are not guarantees of future performance. More detailed information on the potential factors which could affect the financial results of the Company is contained in the Company's public filings and reports.

All investments are subject to risk. Past performance is no guarantee of future returns. Prospective investors are advised to seek expert legal, financial, tax and other professional advice before making any investment decision. The value of investments may fluctuate. Results achieved in the past are no guarantee of future results.

This announcement is issued by the Company, whose registered address is BNP Paribas House, St Julian's Avenue, St Peter Port, Guernsey, GY1 1WA

© 2021 HarbourVest Global Private Equity Limited. All rights reserved.

Strategic ReportChair's Statement

Dear Shareholder

I am pleased to report that HVPE has delivered a NAV per share increase of 30.4% over the financial year - the largest 12-month increase in HVPE's 13-year history. I reflect here on how HVPE has been able to deliver this extraordinary growth through a period of heightened market volatility and widespread disruption to the business environment, mindful also of the challenges that still lie ahead for the global economy and society at large.

Financial Performance

While NAV per share finished the financial year strongly ahead, on a monthly basis performance fluctuated more than usual. Valuations declined in the early stages of COVID-19, but a strong rebound in the middle of the year recovered all of these losses. From this point, NAV per share continued to climb with a particularly strong gain in the final quarter. This resulted in a year-end NAV per share of $35.97 (31 January 2020: $27.58); equivalent to more than three-and-a-half times the opening value of $10.00 in December 2007.

Portfolio performance and the key drivers of this growth are covered in detail in the Investment Manager's Report on pages 10 to 15. However, I am keen to remark on the resilience of the portfolio, which I believe is testament both to HVPE's strategy and to the quality of the Investment Manager. Our steadfast, consistent approach to investing, and our Manager's dedication to driving strong growth from a globally diversified private markets portfolio, continues to deliver outperformance for HVPE's shareholders. We believe it is HVPE's broadly spread, high-quality exposure to opportunities worldwide which has supported robust NAV per share growth over the last year and over the much longer term.

Another core driver of performance has been HVPE's 36% weighting to growth equity and venture companies, in particular the overweight exposure to the technology sector. There have been a number of large and high-profile Initial Public Offerings ("IPOs") in the period, the aggregation of which contributed markedly to overall returns. HVPE has now outperformed the FTSE AW TR Index on an annualised basis by 4.0% since inception.

Despite this robust long-term NAV per share performance, it is important to acknowledge the volatility in our share price during the year. The pandemic-driven global sell-off in March 2020 drove the share prices of most investment companies sharply lower. The dedicated HVPE team at HarbourVest moved quickly to reassure us that our financial position remained robust and that there was no HVPE-specific issue driving the share price movement. I am pleased to say that the majority of our shareholders held firm and continued to support HVPE, helping the share price rebound sharply to reach a new all-time high in December. While it ended the financial year at £18.70, the share price has since continued to increase and on the 21 May closed at £20.40 - more than double its level of only five years ago.

Response to COVID-19

As reported in my last statement, the Board worked closely with the Investment Manager to understand the potential impact of the pandemic on our underlying investments, and acted swiftly to assess any implications for the balance sheet. The insight gleaned from a thorough portfolio risk assessment, coupled with updated financial and NAV growth projections, fed into a set of updated forecast scenarios which are described on page 12.

As a prudent measure given the prevailing cash flow uncertainty, the Board drew down $200 million on its credit facility in April 2020. At the same time, the Investment Manager temporarily paused commitments to new HarbourVest funds. With careful consideration, the Board subsequently agreed to participate in an attractive secondary co-investment through its existing commitment to a secondary overflow fund. As cash flows stabilised, $80 million was repaid on the facility in July. Please refer to the timeline below to see the actions taken by the Board and Investment Manager during this period. The outcome for the full year has demonstrated that HVPE was well positioned strategically, and had the appropriate financial provisions in place, to see it through these turbulent times.

Balance Sheet

Careful balance sheet management is critical for a closed-ended vehicle with variable portfolio cash flows and a multi-year investment horizon. We took the necessary steps through the year to ensure the balance sheet could withstand any pressure from unusual cash flow patterns brought on by the pandemic. HVPE ended the year with $98.4 million of cash and cash equivalents. Noting the drawn balance on the credit facility of $120 million at 31 January 2021, this equates to a net debt position of $21.6 million, with $480 million remaining available on the facility.

Period Post Year EndFinancial Performance

Since the year end, HVPE has issued four NAV per share updates. The latest, published on 21 May, reported an estimated NAV per share of $36.62, an uplift of 1.8% from 31 January 2021, largely driven by increases in the publicly held companies within the portfolio. Further detail can be found under Recent Events on page 16.

Corporate Governance and Board Changes

The Board is alive to the fact that strong corporate governance supports the smooth running of HVPE, whilst ensuring the highest possible standards for its stakeholders. To help fulfil our duties in this regard, the Board initiated the search for our first dedicated HVPE Head of Corporate Governance and duly appointed Alexandra Cornforth in April 2020.

The Board also maintains a robust succession planning programme to ensure Directors hold the necessary balance of skills to deliver the best stewardship of the assets for HVPE's shareholders. As part of this process, I am pleased to announce the appointment of Ms Libby Burne, who joined the Board as an independent non-executive Director with effect from 1 March 2021. Libby brings with her 20 years' experience with PwC and we welcome her to the Board in her first listed non-executive directorship. Libby replaces Andrew Moore, who will step down at the Annual General Meeting ("AGM") in July. Andrew has provided excellent service to HVPE since its launch and he leaves with our gratitude and very best wishes.

The Board and ESG

It is with heightened focus that we consider all matters ESG at three levels: the Board, HarbourVest and investee companies. We are dedicated to promoting the highest standards which we believe foster higher-quality investments and improved returns. This year the Board has helped drive the ESG agenda and, with Carolina Espinal's efforts as the HVPE Director responsible for ESG matters, further increased engagement levels with HarbourVest. In addition, we have formulated our approach to ESG, and are pleased to describe this in more detail on pages 44 and 45. We remain impressed by the persistent efforts by the Investment Manager in the pursuit of continuous improvement in ESG standards at the firm level and within the private equity managers with whom it invests on HVPE's behalf. Details can be found on pages 13 to 15.

Annual General Meeting and Shareholder Webcast

HVPE's AGM will be held in Guernsey at 1.00 p.m. BST on 21 July 2021. Formal notice will be sent to registered shareholders in the week commencing 21 June 2021. Given ongoing travel restrictions on account of COVID-19, no Director other than the Guernsey residents Mr Moore and Ms Burne will be present in person. We hope that all registered shareholders will exercise their votes by proxy. Except for Mr Moore who will be stepping down at this AGM, all Directors will submit themselves for re-election. Similar to last year, in advance of the formal AGM, HVPE will hold a webcast on 10 June 2021 at 11.00 a.m. BST. Shareholders should contact HVPE at: hvpeevents@harbourvest.com should they wish to participate.

Outlook

As we reflect just over one year on from the onset of the COVID-19 crisis, we cannot escape the magnitude of the situation we are all living through. Businesses have been challenged and pushed in new directions more rapidly than ever before; some have struggled while others have thrived. From an investment perspective, this year has reaffirmed the effectiveness of HVPE's strategy. With renewed conviction we can herald the power of diversification and further demonstrate the benefits of investing with a high-calibre private markets manager. Our structure has enabled, through the existing uncalled commitments to HarbourVest funds, a steady pace of investment through the crisis. We thank shareholders, old and new, who have supported us through the challenging times experienced in 2020.

We look forward with cautious optimism, confident that HVPE is well placed to deliver a long-term private markets solution to many investors otherwise unable to access such high-quality and exciting private companies.

Ed Warner

27 May 2021

Investment Manager's Report

Introductory Note

This report presents a summary of HVPE's performance in the 12 months to 31 January 2021. During this period, the outbreak of COVID-19 caused widespread disruption to society and economies around the world. While monetary and fiscal stimulus has since supported a recovery in financial markets, as at 27 May 2021, continued fallout from the pandemic poses ongoing challenges in many countries. For investment companies such as HVPE, its Investment Manager, and underlying portfolio companies, this has been an unsettling and difficult period. Acting quickly and decisively in the face of adversity has been paramount in order to protect the Company's stakeholders. The timeline of actions taken by HVPE's Board and the Investment Manager during this period can be seen on pages 4 and 5.

Portfolio Performance

NAV per Share - 12 Months to 31 January 2021

HVPE's portfolio generated a positive NAV per share return over the reporting period, increasing by 30.4% to $35.97 at 31 January 2021 from $27.58 at 31 January 2020.

Despite this being a record year for NAV per share growth, it is important to note that the onset of COVID-19 did lead to increased volatility in HVPE's monthly estimated NAV per share performance throughout the financial year; a negative movement in May 2020, driven by a decline in Q1 valuations, was followed by three subsequent strongly positive quarters. The Q4 2020 valuations in particular revealed significant gains across all strategies. It is these Q4 2020 valuations which form the basis of the final 31 January 2021 NAV per share figure quoted in this report.

Most major equity market indices closed the year higher after rebounding strongly from sharp declines during Q1 2020. HVPE's public market benchmark, the FTSE AW TR Index (in US dollars), increased by 17.4% in the 12 months to 31 January 2021. Although HVPE's NAV per share growth of 30.4% outperformed this over the period, public markets tend to be more volatile especially during periods of uncertainty, and therefore short-term comparisons are less meaningful. Longer-term comparisons through the cycle are more reflective of HVPE's relative performance, as described on page 3 of the KPIs section.

During the 12 months ended 31 January 2021 there was a $682.3 million net gain on investments, contributing to an overall increase in net assets of $669.8 million. Of the $682.3 million, the majority - 84% - came from unrealised growth within the portfolio. This compares with a $289.3 million net gain on investments and an overall increase in net assets of $278.7 million for the 12 months to 31 January 2020.

The higher overall net gains in this reporting period compared with the same period last year reflect the strong performance of the underlying portfolio, particularly in overweight exposures such as technology and, to a lesser extent, healthcare (see the industry diversification chart on page 15). Despite these sector overweights, HVPE remains well diversified, as demonstrated by the pie charts on page 14 and 15. We believe diversification remains essential to achieving consistently strong returns, as the various sub-sectors within the portfolio tend to outperform on a relative basis at different stages in the cycle. At 31 January 2021, the top 100 companies in the portfolio represented 35.3% of the Investment Portfolio and the top 1,000 companies represented 84.6%.

In percentage terms, the Primary portfolio was the best performing strategy, delivering value growth of 33.1% over the 12 months. Geographically, the strongest gains came from the European portfolio, which generated a value increase of 36.8%; this was followed by the US assets, which returned 24.3%. In terms of stage, Venture and Growth Equity was the strongest performer, growing 41.3% over the 12 months ended 31 January 2021. In the prior financial year, the best performers by geography, strategy and stage were the same as above. More information on the growth drivers for the year to 31 January 2021 can be found on page 33.

As at 31 January 2021, HVPE held investments in 51 HarbourVest funds and 10 secondary co-investments1 (compared with 49 and seven, respectively, at 31 January 2020). Of these, the largest drivers of NAV per share growth during the 12 months to 31 January 2021 are described below:

· Fund X Venture, a US-focused venture fund-of-funds, was the largest contributor, adding $0.84 to NAV per share. With a vintage year of 2015, this fund is in the growth phase. This growth came predominantly from unrealised gains over the period.

· Following closely behind this was Fund IX Venture, an earlier fund of the same strategy, adding $0.81 to NAV per share. This is a 2011 vintage fund now entering its mature phase. Nevertheless, this uplift was derived primarily from unrealised gains over the period.

· Co-Investment IV, a global direct co-investment fund, added $0.66. This 2016 vintage fund is in the investment phase. As might be expected at this stage of the fund's life, most of this growth was driven by unrealised gains.

· HIPEP VII, a 2014 vintage international fund-of-funds, was the fourth largest contributor adding $0.50 to NAV per share over the period.

· Fund X Buyout, a 2015 vintage US-focused buyout fund-of-funds, added $0.46 to NAV per share.

All of the remaining HarbourVest funds in the portfolio added an aggregate $5.34 to HVPE's NAV per share over the financial year.

1 These include five Secondary Overflow III investments, three Secondary Overflow IV investments; Absolute, referred to as "HVPE Avalon Co-Investment L.P.", and Conversus, referred to as "HVPE Charlotte Co-Investment L.P.", in the Audited Consolidated Schedule of Investments. Absolute has been fully realised; however, $474,898 remains in escrow.

Portfolio Cash Flows and Balance Sheet

HVPE was a net investor in the 12 months to 31 January 2021, following capital calls of $430.9 million into HarbourVest funds (12 months to 31 January 2020: $324.2 million) and cash distributions of $289.5 million (12 months to 31 January 2020: $308.2 million). This resulted in net investment of $141.4 million over the reporting period, driven by elevated capital calls during March and April. While this capital was deployed primarily into new opportunities, part of the total was used to support existing investments and to fund deals closed in the preceding months.

As reported in the Company's Semi-Annual Report and Accounts 2020, elevated capital calls coincided with a sharp fall in distributions beginning in April and May, with the result that HVPE experienced significant cash outflow on a net basis during the early part of the year. As a prudent measure, on 9 April 2020, HVPE provided notice to its lenders, Credit Suisse and Mitsubishi UFJ, to draw down $200.0 million from the Company's $600.0 million credit facility (the "Facility"). Subsequently, based on an updated cash flow analysis presented by the Investment Manager, the Board approved an $80.0 million partial repayment in July. At 31 January 2021, following this repayment, the Facility was $120.0 million drawn, leaving HVPE with access to the remaining $480.0 million.

Since September 2020, cash flows have normalised. However, in December, HVPE received a record level of distributions from HarbourVest funds in cash terms indicating strong exit activity. While distributions in December were driven mostly from HarbourVest primary funds (71%), this was followed by direct co-investments at 16%, which included proceeds received from the sale of South Korean dry bulk and liquefied natural gas carrier H-Line Shipping (HVPE's 12th largest underlying portfolio company at 31 January 2020). December 2020 also marked a record month for capital calls in cash terms, excluding non-routine investments. This is partly as a result of the larger Investment Pipeline at the beginning of 2020. However, December is typically a strong month for calls, and in Q4 2020, investment activity accelerated.

Overall, net negative cash flow including operating expenses in the period resulted in HVPE's cash balance declining from $130.6 million at 31 January 2020 to $98.4 million at 31 January 2021 (noting that the closing cash position includes the contribution from the $120.0 million draw on the credit facility). The latest cash position is reported under Recent Events on page 16.

In the reporting period, the largest HarbourVest fund capital call ($55.0 million) came from Co-Investment V, a 2018 vintage global direct co-investment fund. Other large capital calls originated from Fund XI Buyout ($50.8 million) and Fund XI Venture ($48.5 million), both 2018 vintage funds currently in the investment phase and building out their portfolios. Following these were calls to fund investment activity from 2019 Global Fund ($30.0 million), Dover X ($28.8 million), and Fund X Buyout ($26.5 million).

Distributions in the HVPE portfolio were driven by a mix of HarbourVest funds across all strategies, with the largest total amount in the period ($24.8 million) received from Fund VIII Buyout, a US-focused buyout fund-of-funds in its mature phase, which distributed proceeds received from multiple underlying partnerships. Fund IX Venture, a US-focused venture fund-of-funds followed, with distributions totalling $24.1 million.

HVPE has indirect exposure, on a look-through basis, to a pro rata share of borrowing carried on the balance sheets of some of the HarbourVest funds (referred to as HarbourVest fund-level borrowing) in which HVPE is a Limited Partner ("LP"). It is important to note that HVPE has no additional liability for these borrowings beyond its uncalled commitments to each fund. At 31 January 2021, HVPE's share of HarbourVest fund-level borrowing on a look-through basis was $378.2 million, a net increase of $11.4 million from $366.8 million at 31 January 2020. Expressed as a percentage of NAV, the figure decreased from 16.7% to 13.2% over the 12-month period. In order to calculate a look-through gearing figure, an investor should take the fund-level borrowing of $378.2 million and factor in HVPE's net cash/debt position at the Company level (net debt $21.6 million). As at 31 January 2021, the resulting net total borrowing figure of $399.8 million would translate to an approximate level of look-through gearing of 13.9%. More detail on the HarbourVest fund-level borrowing, and how we factor this into our balance sheet management, can be found under Managing the Balance Sheet on page 22.

Revisions to the Modelling in Light of COVID-19

HVPE continuously refines the portfolio modelling and base case projections to reflect macro developments and other relevant factors. The advent of COVID-19 called for updates to the scenario models. The Investment Manager's thorough risk analysis of the underlying Investment Portfolio and likely impact related to COVID-19 fed into the assumptions and in May 2020, the Investment Manager presented four revised five-year model scenarios to the Board: Optimistic, High Base, Low Base and Extreme Downside case. In the months that followed, we saw strong NAV growth and a recovery in the level of cash distributions, with the result that by the end of 2020 HVPE was running well ahead of even the Optimistic case. The four scenarios from May have since been superseded by new five-year projections formulated as part of the annual commitment planning process. These cover: Extreme Downside, Low, Base and Optimistic scenarios.

Portfolio Companies

COVID-19 Portfolio Risk Assessment

In response to COVID-19, the Investment Manager embarked on two bottom-up assessments of the likely impact of COVID-19 on HVPE's portfolio, in April and October. Companies were assessed directly or with the help of the applicable General Partner ("GP"), taking into consideration headquarter location, employee dislocation risk, end user/consumer sentiment sensitivity, person-to-person exposure, business model travel requirements, potential for supply side disruption, and liquidity and leverage profile, among other factors. As at 31 May 2020, approximately 80% of the portfolio by value had been reviewed as part of this exercise. The results indicated that the majority of HVPE's assessed portfolio by value had been deemed likely to experience only a limited or moderate impact, with a relatively small proportion expected to be materially impacted. By October 2020, the Investment Manager had completed a further second-round portfolio risk assessment. While broadly similar in methodology to the first, this most recent analysis focused on the larger positions within the portfolio. This assessment resulted in approximately 78% of HVPE's portfolio by value being reviewed. HVPE's portfolio composition evolves over time, so in order to make a valid comparison to the April results, we held the October sample set constant and re-calculated the equivalent April figures for that population, as shown below. These figures will differ from those reported in the Company's Annual Report on 24 June 2020. As of October, 83% of the assessed portfolio was classified limited or moderate impact while only 6% was identified as high risk at that point in time.

Liquidity Events

During the period, the ten largest individual company realisations in order of HVPE's share of proceeds generated total distributions of $74.0 million. A number of IPOs and Mergers and Acquisitions ("M&A") transactions contributed significant amounts to NAV per share in the 12 months to 31 January 2021. This year, the weighted average uplift to pre-transaction carrying value for a large sample of liquidity events in the period was 153%. This unusually large uplift was driven by IPOs from within the venture and growth equity portfolio. A table of the top five largest contributors to NAV per share is displayed below. The top ten distributions by value are listed on page 32.

Top Five M&A transactions

(by contribution to HVPE NAV per share)

Top Five IPOs

(by contribution to HVPE NAV per share)

During the 12 months ended 31 January 2021, there were 270 liquidity events, down from 336 for the 12 months to 31 January 2020. This represents a decline of 20% compared with the last financial year. The lower volume of exit activity in 2020 resulted from the disruption and associated uncertainty caused by COVID-19, leading many GPs to suspend or delay exit processes. Approximately 67% (180) of the liquidity events in HVPE's portfolio were trade sales or sponsor-to-sponsor transactions, with the remaining 33% (90) being IPOs. Notable IPOs during the period included Snowflake, Allegro, Affirm, Yatsen Holding Limited, and Dr. Martens.

Of HVPE's total 270 liquidity events, 168, or 62%, related to venture-backed companies. This figure is representative of wider market trends as there were a considerable number of venture-related exits in the year, with the technology and healthcare sectors dominating this activity.

HVPE Activity

New Fund Commitments

In the 12 months ended 31 January 2021, HVPE made total commitments of $194.9 million across six HarbourVest funds (12 months to 31 January 2020: $570.0 million). This took total unfunded commitments to $1.6 billion at 31 January 2021. The comparatively low level of commitments made during the year was a result of a decision by the Board and the Investment Manager to place HVPE's commitment plan, in respect of new HarbourVest funds, on hold for a period of seven months due to the outbreak of COVID-19. New fund commitments re-started in Q4 2020 while HarbourVest funds from the existing Investment Pipeline (unfunded commitments) continued to call capital for new investments throughout the year, enabling the Company to take advantage of attractive opportunities.

Of the total capital committed, the largest commitments were $50.0 million each to Dover X (a global secondary fund) and 2020 Global Fund (a global multi-strategy fund-of-funds). Other large commitments included $40.0 million to HIPEP IX (an international fund-of-funds) and a commitment of $37.8 million to a secondary transaction within Secondary Overflow IV. The remaining commitments included $12.8 million and $4.3 million to two further secondary transactions within Secondary Overflow IV.

These commitments are in line with the Company's Strategic Asset Allocation targets and reflect the Investment Manager's and Board's current perspective on the most appropriate portfolio composition required to optimise long-term NAV growth for shareholders.

Strategic Asset Allocation

The Company's SAA targets are reviewed annually and, in November 2020, the HVPE Board decided that these targets should remain unchanged. The current targets can be seen in the pie charts on page 14. The next review is scheduled to take place in November 2021.

Focus on ESG

HarbourVest Partners

The prioritisation of ESG considerations and ethical business standards within HVPE's portfolio is supported by the Investment Manager's robust ESG due diligence and monitoring procedures which it applies across each of its investment strategies. The Investment Manager relies on two primary tools, its proprietary ESG Scorecard that it uses to evaluate GPs on their ESG processes and capabilities, and RepRisk®, an external database that supports both ESG analysis in due diligence and incident-monitoring of ESG and business conduct risks within the portfolio. HarbourVest seeks to use its influence to improve ESG standards in the HVPE portfolio through actively engaging with its GPs through the ESG Scorecard assessment and feedback process and through the sharing of best practice. Further information on how ESG analysis is integrated into HarbourVest's investment processes is set out on pages 29.

HarbourVest's ESG policy and latest digital ESG report for 2020 can be found on the HarbourVest website here: https://www.harbourvest.com/why-harbourvest/corporate-responsibility. Some highlights over the year include:

· In 2020, HarbourVest added new indicators to its proprietary ESG Manager Scorecard to help better understand how GPs are managing, prioritising and disclosing on ESG risks and value creation opportunities.

· HarbourVest was also proud to receive an A+ in governance in its UN Principles for Responsible Investment ("PRI") rankings, and equally proud to be recognised by the British Private Equity & Venture Capital Association ("BVCA") with its 2020 Excellence in ESG Award in the LP category.

· HarbourVest updated its ESG Policy in early 2021 to reflect evolving ESG practices, and the firm's deep commitment to responsible investing. The new Policy includes more detailed information on its ESG integration processes and reflects HarbourVest's strategic commitments to climate change and diversity and inclusion.

Climate Change Strategy

· In last year's ESG Report, HarbourVest announced plans to develop its climate strategy around the Task Force on Climate-related Financial Disclosures ("TCFD") recommendations. This year, HarbourVest is pleased to share in its ESG report its first progress update around the TCFD's four pillars: governance, strategy, risk management, and metrics and targets.

· In addition to being a TCFD Supporter, HarbourVest also became a member of the Initiative Climate International ("iCI") in 2020. The iCI is a practitioner-led initiative to develop tools and materials that aid private equity action on climate change.

· In 2020, for the first time, HarbourVest committed to measuring and offsetting its carbon footprint, and is now, a certified CarbonNeutral® company in accordance with CarbonNeutral Protocol, the leading framework for carbon neutrality.

Diversity and Inclusion

· Internally, HarbourVest's Diversity & Inclusion Council accomplished much in 2020, taking on issues that were of most importance to the firm. By instituting key policies and delivering education, the Council helped the firm focus on creating more of a shared understanding, appreciation, and commitment to diversity and inclusion.

· On the talent and hiring front, HarbourVest developed plans to launch its first-ever internship programme in conjunction with Sponsors for Educational Opportunity, which works to close the career opportunity gap in underserved communities. It also joined the #10000BlackInterns initiative in the UK.

Engaged Corporate Citizen

· HarbourVest's Global Volunteering Group helped identify and work with organisations that needed urgent help, focusing in particular on COVID-19 driven food insecurity and poverty. Employees donated generous amounts of both time and money - $2.4 million - to support these causes.

Market Perspectives and Outlook

Entering 2020, global private markets were in an extended period of outperformance. However, in a span of months, there was a series of shocks, the quantum of which might typically be seen over decades.

Private equity has always invested in the technology, consumer, healthcare, education, and business services areas, but the pandemic has evolved or changed the paradigm - causing us to consider new business models, consumer behaviours, and social norms. This "new idea" environment is creating an investment landscape that we believe could be ripe for value-added investments. We expect to see continued acceleration in the adoption of technology and in the transformation of sectors, with GPs becoming more focused on highly technology-enabled businesses. Also, we anticipate that certain industries will evolve differently as a new market normal develops. For example, the restaurant, food service, and tourism industries have been, and are likely to continue to be, hard hit in the short term, while sectors such as collaboration software, tele-health and home health, online pharmacy, and telecom and internet will continue to carry this growth momentum over the long term.

In 2021, GPs are highly focused on evaluating market risk and are staying extra-vigilant, with many turning to their experience from past market dislocations that continue to resonate. Despite these defensive measures, history shows us that the industry's strongest returns are often generated in challenging times, where disruption creates opportunity. Going forward GPs need to be selective when making new investments and identify attractive return profiles in light of prevailing risk levels.

At the same time, COVID-19 has accelerated trends and reinforced views among many high-quality GPs that the secondary market is an important liquidity tool in their toolkits.

The current co-investment climate continues to be one of high valuations and leverage, as well as low interest rates for high-quality businesses. As was the case prior to COVID-19, GPs have significant amounts of dry powder which should translate into high investment activity in 2021 and beyond.

Challenges clearly remain, but unprecedented times can also be a strong breeding ground for opportunity. HarbourVest's investment teams around the globe certainly believe this to be the case for 2021 as they continue to balance ongoing risk assessment with strategic growth investing. HVPE's ability to maintain a steady pace of investment in HarbourVest funds should allow it to participate in such opportunities and to emerge even more strongly positioned in the long term.

Recent Events

New Commitments

Between 1 February 2021 and 27 May 2021, HVPE committed $188.8 million to the HarbourVest funds outlined below.

HVPE Estimated NAV At 30 April 2021

HVPE releases an estimated NAV on a monthly basis. These reports are available on the Company's website, generally within 20 calendar days of the month end.

On 21 May, HVPE published an estimated NAV per share at 30 April 2021 of $36.62 (£26.49), an increase of $0.65 from the final 31 January 2021 NAV (US Generally Accepted Accounting Principles ("GAAP")) figure of $35.97. This latest NAV per share is based on a valuation breakdown of: 16% as at 30 April 2021 (representing the public companies in the portfolio); 4% actual 31 March 2021; and 80% actual 31 December 2020. Consistent with previous estimated NAV reports, valuations are also adjusted for foreign exchange movements, cash flows, and any known material events to 30 April 2021.

The Investment Pipeline of unfunded commitments increased from $1,573.2 million at 31 January 2021 to $1,639.2 million at 30 April 2021, based on the new commitments, capital funded, and taking foreign exchange movements into account.

At the end of April HVPE's borrowing on its own credit facility was $115.0 million. HVPE's look-through exposure to borrowing at the HarbourVest fund level had decreased by $27.1m from 31 January 2021, to $351.1 million. The latest balance sheet ratios can be found in the factsheet on the HVPE website: www.hvpe.com.

Share Price Since 31 January 2021

Since 31 January 2021, the share price has continued to strengthen. During the period 1 February to 21 May 2021, the share price increased from £18.70 to £20.40, or 9.1%.

The market capitalisation of the Company as at 21 May 2021 was £1.6 billion, and as of the same date HVPE was ranked 121st in the FTSE 250.

Principal Risks and Uncertainties

Risk Factors and Internal Controls

The Board is responsible for the Company's risk management and internal control systems and actively monitors the risks faced by the Company, taking steps to mitigate and minimise these where possible. Further details on the Board's governance and oversight can be found on pages 44 to 48.

Risk Appetite

The Board's investment risk appetite is to follow an over-commitment policy (as explained in the Directors' Report on page 42) that allows balanced, regular investment through economic and investment cycles whilst ensuring that it has access to sufficient funding for any potential negative cash flow situations, including under an Extreme Downside scenario. At the same time, the funding available to the Company by way of cash balances and lending facilities is managed to ensure that its cost, by way of interest, facility fees or cash drag, is reasonable. When considering other risks, the Board's risk appetite is effectively governed by a cost benefit analysis when assessing mitigation measures; however, at all times the Board will seek to follow best practice and remain compliant with all applicable laws, rules and regulations.

Principal Risks

As recommended by the Audit and Risk Committee, the Directors have adopted a risk management framework to govern how the Board identifies existing and emerging risks, determines risk appetite, identifies mitigation and controls, assesses, monitors and measures risk, and reports on risks. The Board reviews risks at least twice a year and receives deep-dive reports on specific risks as recommended by the Audit and Risk Committee (see the report of the activities of that Committee on pages 52 to 54). At the start of the year under review the Board had identified 12 main risks which have a higher probability and a significant potential impact on performance, strategy, reputation, or operations (Category A risks). From these, the five risk categories identified below were considered the principal risks faced by the Company where the combination of probability and impact was assessed as being most significant. The Board also considered that there were 20 existing or emerging risks (Category B risks), which are monitored on a watch list.

As the pandemic took hold early in 2020, the Board and the Audit and Risk Committee considered the impact that the situation would have on the Company's business and its service providers. As a result, the Board elevated risks relating to the Company's loan facility, key personnel, communication with shareholders and valuation from Category B to Category A, and downgraded risks relating to fund expenses and MIFID II from Category A to Category B. Due to the material impact that the pandemic has had on society and the economy, and in turn, the Company, the principal risks below continue to be considered through the lens of COVID-19. Brexit was not considered likely to have a major impact on the Company or the Investment Manager, and was deemed to be a Category B risk by the Board. No issues for the Company actually arose when the UK left the EU or at the end of the transition period.

Board of Directors

Edmond ("Ed") Warner

Chair, Independent Non-Executive Director, appointed August 2019

Key relevant skills:

· Leadership skills

· Investment strategist

· Extensive financial services experience

Ed Warner has extensive financial services experience from years spent in senior positions at several investment banks and financial institutions, including IFX Group, Old Mutual plc, NatWest Markets, and Dresdner Kleinwort Benson.

He also has considerable PLC experience and has chaired the boards at a range of prominent organisations. He is currently Chair of Air Partner PLC, an aviation services business, online derivatives exchange LMAX, and the BlackRock Energy and Resources Income Trust. Prior chairman roles include Grant Thornton UK LLP, Standard Life Private Equity Trust, and Panmure Gordon & Co.

Committees: Chair of the Nomination Committee and Member of the Management Engagement and Service Provider, and Inside Information Committees.

Francesca Barnes

Independent Non-Executive Director, appointed April 2017

Key relevant skills:

· Extensive private equity investment experience

· Nine years' governance experience on public and private company boards

· Risk management experience

Francesca Barnes is a Non-Executive Director of NatWest Holdings Limited, Coutts & Company and a number of NatWest Group's other ring-fenced bank boards, as well as Capvis private equity. She is a member of the University of Southampton council and recently stood down as Chair of Trustees for Penny Brohn UK. Previously, Francesca spent 16 years at UBS AG. For the latter seven of these she served as Global Head of Private Equity, following on from senior positions in restructuring and loan portfolio management. Prior to this, she spent 11 years with Chase Manhattan UK and US, in roles spanning commodity finance, financial institutions, and private equity.

Committees: Chair of the Management Engagement and Service Provider Committee and Member of the Audit and Risk, and Nomination Committees.

Elizabeth ("Libby") Burne

Independent Non-Executive Director, appointed March 2021

Key relevant skills:

· Chartered Certified accountant

· Extensive audit and risk management experience

· 20 years' experience of working with Guernsey regulated, listed, closed-ended investment structures

Libby Burne joined the Board of Directors on 1 March 2021. Prior to her appointment Libby was an audit director at PwC in the Channel Islands and, previously, PwC Australia. Over her career Libby has worked with countless global clients on strategic, financial, risk, and corporate governance matters. As an audit director she led the audits of investment vehicles listed on the London Stock Exchange and Australian Stock Exchange as well as many private alternative asset structures and insurance companies. Libby is a Fellow of the Association of Chartered Certified Accountants, holds a degree in Applied Accounting, and is a Guernsey resident, as such bringing recent and relevant financial and sector experience.

Committees: Member of the Audit and Risk, Nomination, and Management Engagement and Service Provider Committees.

Carolina Espinal

Non-Executive Director, appointed July 2019

Key relevant skills:

· 18 years' private equity investment experience

· Responsibility for strategy and business development of European and global primary businesses

· Lead Director for ESG factors

Carolina Espinal joined HarbourVest in 2004 to focus on partnership investments in Europe and other emerging markets and became a Managing Director in 2015. Carolina focuses on managing European venture capital and buyout partnership investments and has collaborated with the secondary and co-investment groups on several investment opportunities. As a HarbourVest executive she currently serves on the advisory boards of funds managed by Abénex Capital, ECI, Inflexion, and Advent International.

Her previous experience includes two years as a financial analyst with the Merrill Lynch Energy and Power M&A team in Houston.

Carolina graduated from Rice University with a BA in Managerial Studies, Policy Studies, and Economics in 2000. She received an MSc in Finance from the London Business School in 2003.

Committees: None (as a HarbourVest executive)

Alan Hodson

Senior Independent Non-Executive Director, appointed April 2013

Key relevant skills:

· Knowledge of listed equity markets

· Experience on several investment company boards

· Strong background in governance and risk management

Alan Hodson is Chairman of Charity Bank. Alan joined Rowe and Pitman (subsequently SG Warburg, SBC, and UBS) in 1984 and worked in a range of roles, all related to listed equity markets. He became Global Head of Equities in April 2001 and was a member of the Executive Committee of UBS Investment Bank and of the UBS AG Group Managing Board. He retired from UBS in June 2005 and has since held positions on a variety of commercial and charity boards.

Committees: Member of the Audit and Risk, Nomination, and Management Engagement and Service Provider Committees.

Andrew Moore

Independent Non-Executive Director, appointed October 2007

Key relevant skills:

· Extensive experience as an executive and non-executive director of regulated entities

· Risk management experience

· Former head of a fund administration business

Andrew Moore is Group Chairman of Cherry Godfrey Holdings Limited, Group Chairman of Sumo Limited and a Director of Sumo Acquisitions Limited and Sumo Holdings Limited. Andrew joined Williams & Glyns Bank, which subsequently became The Royal Bank of Scotland, after obtaining a diploma in business studies. He moved to Guernsey to establish and act as Managing Director of a trust company for The Royal Bank of Scotland in 1985. During his career, Andrew held a range of senior management positions, including acting as head of corporate trust and fund administration businesses for The Royal Bank of Scotland in Guernsey, Jersey, and the Isle of Man, which provided services to many offshore investment structures holding a wide variety of asset classes. Andrew has over 30 years of experience as both an executive and non-executive director of companies including investment funds and banks.

Committees: Member of the Audit and Risk, Nomination, and Management Engagement and Service Provider Committees.

Steven Wilderspin

Independent Non-Executive Director, appointed May 2018

Key relevant skills:

· Chartered accountant, qualified in audit

· Extensive governance experience on public and private company boards

Steven Wilderspin has more than ten years' experience as a Non-Executive Director on the boards of private equity partnerships and listed investment companies. Steven, a qualified Chartered Accountant, has provided independent directorship services since April 2007. He has served on a number of private equity, property, and hedge fund boards as well as commercial companies. Steven currently serves as the Chairman of the risk committee of Blackstone Loan Financing Limited and Chairman of the audit and risk committee of GCP Infrastructure Investments Limited. In December 2017 Steven stepped down from the Board of 3i Infrastructure plc, where he was Chairman of the Audit and Risk committee, after ten years' service. From 2001 until 2007, Steven was a Director of fund administrator Maples Finance Jersey Limited, where he was responsible for fund and securitisation structures. Steven has recent and relevant financial and sector experience.

Committees: Chair of the Audit and Risk Committee, and Member of the Inside Information, Nomination, and Management Engagement and Service Provider Committees.

Peter Wilson

Non-Executive Director, appointed May 2013

Key relevant skills:

· Member of HarbourVest's two-person Executive Management Committee ("EMC"), including responsibility for HarbourVest's corporate strategy

· 24 years' private equity industry knowledge and experience

Peter Wilson joined HarbourVest's London team in 1996 and is one of two members of the firm's EMC. He co-leads secondary investment activity in Europe and is a member of the HarbourVest Europe Investment Committee. He serves on the advisory committees for partnerships managed by Baring Vostok Capital Partners, CVC Capital Partners, Holtzbrinck Ventures, and Index Venture Management. He also served as founding Chair of the Board of Trustees of City Year UK Limited.

Prior to joining the firm, he spent three years working for the European Bank for Reconstruction and Development, where he originated and managed two regional venture capital funds in Russia. Peter also spent two years at the Monitor Company, a strategy consulting firm based in Cambridge, Massachusetts.

He received a BA (with honours) from McGill University in 1985 and an MBA from Harvard Business School in 1990.

Committees: None (as a HarbourVest executive)

Directors' Report

Annual Report and Audited Consolidated Financial Statements

The Directors present their report and the Audited Consolidated Financial Statements (the "Financial Statements" or "Accounts") for the year ended 31 January 2021.

A description of important events and principal activities which have occurred during the financial year and their impact on the performance of the Company, as shown in the Financial Statements, is provided in the Strategic Report, beginning with the Chair's Statement on page 4. A description of the emerging and principal risks and uncertainties facing the Company, together with an indication of the Company's likely future development and the important events that have occurred since the end of the financial year, is also provided in the Strategic Report and referenced in the notes to the Financial Statements. Combined, all sections in this document constitute the "Annual Report".

Corporate Summary

The Company is a closed-ended investment company incorporated in Guernsey on 18 October 2007 with an unlimited life. The Company currently has one class of shares (the "Ordinary Shares") and these shares are admitted to trading on the Main Market of the London Stock Exchange.

With effect from 10 December 2018, the Company introduced an additional US dollar market quotation which operates alongside the Company's existing sterling quotation, allowing shares to be traded in either currency.

Investment Objective and Investment Policy

The Company's investment objective is to generate superior shareholder returns through long-term capital appreciation by investing primarily in a diversified portfolio of private equity investments. The Company may also make investments in private market assets other than private equity where it identifies attractive opportunities.

The Company seeks to achieve its investment objective primarily by investing in investment funds managed by HarbourVest, which invests in or alongside third-party managed investment funds ("HarbourVest Funds"). HarbourVest Funds are broadly of three types: (i) "Primary HarbourVest Funds", which make limited partner commitments to underlying private market funds prior to final closing; (ii) "Secondary HarbourVest Funds", which make purchases of private market assets by acquiring positions in existing private market funds or by acquiring portfolios of investments made by such private market funds; and (iii) "Direct HarbourVest Funds", which invest into operating companies, projects, or assets alongside other investors.

In addition, the Company may, on an opportunistic basis, make investments (generally at the same time and on substantially the same terms) alongside HarbourVest Funds ("Co-investments") and in closed-ended listed private equity funds not managed by HarbourVest ("Third-Party Funds"). Co-investments made by the Company may, inter alia, include investments in transactions structured by other HarbourVest vehicles including, but not limited to, commitments to private market funds or operating companies in which other HarbourVest funds have invested.

Cash at any time not held in such longer-term investments will, pending such investment, be held in cash, cash equivalents, money market instruments, government securities, asset-backed securities, and other investment-grade securities and interests in any private equity vehicle that is listed or traded on any securities exchange (''Temporary Investments'').

The Company uses an over-commitment strategy in order to remain as fully invested as possible. To achieve this objective, the Company has undrawn capital commitments to HarbourVest Funds and Co-investments which exceed its liquid funding resources, but uses its best endeavours to maintain capital resources which, together with anticipated cash flows, will be sufficient to enable the Company to satisfy such commitments as they are called.

Diversification and Investment Guidelines

The Company will, by investing in a range of HarbourVest Funds, Co-investments, and Third-Party Funds, seek to achieve portfolio diversification in terms of:

· geography: providing exposure to assets in the US, Europe, Asia, and other markets;

· stage of investment: providing exposure to investments at different stages of development such as early stage, balanced and late stage venture capital, small and middle-market businesses or projects, large capitalisation investments, mezzanine investments, and special situations such as restructuring of funds or distressed debt;

· strategy: providing exposure to primary, secondary, and direct co-investment strategies;

· vintage year: providing exposure to investments made across many years; and

· industry: with investments exposed, directly or indirectly, to a large number of different companies across a broad array of industries.

In addition, the Company will observe the following investment restrictions:

· With the exception, at any time, of not more than one HarbourVest Fund or Co-investment to which up to 40% of the Company's Gross Assets (see page 84 for the definition) may be committed or in which up to 40% of the Company's Gross Assets may be invested, no more than 20% of the Company's Gross Assets will be invested in or committed at any time to a single HarbourVest Fund or Co-investment.

· No more than 10% of the Company's Gross Assets will be invested (in aggregate) in Third-Party Funds.

· The Investment Manager will use its reasonable endeavours to ensure that no more than 20% of the Company's Gross Assets, at the time of making the commitment, will be committed to or invested in, directly or indirectly, whether by way of a Co-investment or through a HarbourVest Fund, (a) any single ultimate underlying investment, or (b) one or more collective investment undertakings which may each invest more than 20% of the Company's Gross Assets in other collective investment undertakings (ignoring, for these purposes, appreciations and depreciations in the value of assets, fluctuations in exchange rates, and other circumstances affecting every holder of the relevant asset).

· Any commitment to a single Co-investment which exceeds 5% of the Company's NAV (calculated at the time of making such commitment) shall require prior Board approval, provided however that no commitment shall be made to any single Co-investment which, at the time of making such commitment, represents more than 10% (or, in the case of a Co-investment that is an investment into an entity which is not itself a collective investment undertaking (a "Direct Investment"), 5%) of the aggregate of: (a) the Company's NAV at the time of the commitment; and (b) undrawn amounts available to the Company under any credit facilities.

· The Company will not, without the prior approval of the Board, acquire any interest in any HarbourVest Fund from a third party in a secondary transaction for a purchase price that:

(i) exceeds 5% of the Company's NAV; or

(ii) is greater than 105% of the most recently reported NAV of such interest (adjusted for contributions made to and distributions made by such HarbourVest Fund since such date).

Save for cash awaiting investment which may be invested in Temporary Investments, the Company will invest only in HarbourVest Funds (either by subscribing for an interest during the initial offering period of the relevant fund or by acquiring such an interest in a secondary transaction), in Co-investments or in Third-party Funds.

Company's Right to Invest in HarbourVest Funds

Pursuant to contractual arrangements with HarbourVest, the Company has the right to invest in each new HarbourVest Fund, subject to the following conditions:

· Unless the Board agrees otherwise, no capital commitment to any HarbourVest Fund may, at the time of making the commitment, represent more than 35% or less than 5% of the aggregate total capital commitments to such HarbourVest Fund from all its investors.

· Unless HarbourVest agrees otherwise, the Company shall not have a right to make an investment in, or a commitment to, any HarbourVest Fund to which ten or fewer investors (investors who are associates being treated as one investor for these purposes) make commitments.

Leverage

The Company does not intend to have on its balance sheet aggregate leverage outstanding at Company level for investment purposes at any time in excess of 20% of the Company's NAV. At 31 January 2021, HVPE's drawings on the credit facility for cash management purposes represented approximately 4% of NAV. As at 27 May 2021 the amount drawn remained at approximately 4% of NAV. The Company may use additional borrowings for cash management purposes, or in the event of a material downturn. These borrowings could be for extended periods of time depending on market conditions.

Principal Risks and Uncertainties

The principal risks the Board has reviewed are disclosed on pages 26 and 27 of the Strategic Report.

Results and Dividend

The results for the financial year ended 31 January 2021 are set out in the Consolidated Statements of Operations within the Financial Statements on page 68. In accordance with the investment objective of the Company to generate superior shareholder returns through long-term capital appreciation, the Directors did not declare any dividends during the year under review and the Directors do not recommend the payment of dividends as at the date of this report.

Directors

The Directors as shown on pages 40 and 41 all held office throughout the entire reporting period, except for Ms Burne who was appointed with effect from 1 March 2021. All Directors listed were in place at the date of signature of this Annual Report. Ms Espinal and Mr Wilson are Managing Directors of HarbourVest Partners (UK) Limited, a subsidiary of HarbourVest Partners, LLC. All Directors, other than Ms Espinal and Mr Wilson, are considered to be independent. Mr Hodson is the Senior Independent Director. Further details of the Board composition and rationale for one Director having served more than nine years (Mr Moore) can be found on page 51, noting, however, that he will be stepping down at HVPE's upcoming AGM.

Save as disclosed in this Annual Report, the Company is not aware of any other potential conflicts of interest between any duty of any of the Directors owed to it and their respective private interests.

Directors' Interests in Shares

1 Of the total shares held, 696 shares were split equally between Carolina's three children, with Carolina holding 1,000 shares.

Ms Burne was appointed as a Director with effect from 1 March 2021. At the date of her appointment she held 786 HVPE shares; this amount remains unchanged as at 27 May 2021.

There have been the following changes in Directors' interests between 31 January 2021 and the date of signing of this report.

Changes to Directors' Interests in Shares

2 Of the total shares held, 1,446 shares were split equally between Carolina's three children, with Carolina holding 1,000 shares.

Substantial Shareholders

The table that follows shows the interests of major shareholders based on the best available information provided by the analysis of the Company's share register, incorporating any disclosures provided to the Company in accordance with Disclosure Guidance and Transparency Rule ("DTR") 5 in the period under review and up to 5 May 2021.

Corporate Governance

The Board recognises the importance of sound corporate governance and follows best-practice requirements wherever possible. The Company complies with the AIC Code published in February 2019, which is endorsed by the Financial Reporting Council ("FRC"). A Statement of Compliance with the AIC Code is provided on page 58 and further details about how our Corporate Governance framework operates can be found throughout this Governance Report.

Corporate Responsibility

The Board considers the ongoing interests of stakeholders and investors through open and regular dialogue with the Investment Manager. The Board receives regular updates outlining regulatory and statutory developments and responds as appropriate.

Approach to ESG

The Board recognises the critical importance of ESG considerations to many investors. It acknowledges that ESG issues can present both opportunities and threats to long-term investment performance and is committed to responsible and sustainable investing. The Board also believes that HVPE will benefit from the continued evolution of HarbourVest's ESG practices and standards.

The Board is aware that as an investment company, its approach to ESG matters is materially informed by the strategy of the Investment Manager and accordingly the Board is committed to ensuring that it has appointed an Investment Manager that applies the highest standards of ESG practice and has the skill and vision to respond to ongoing developments. It is confident that in HarbourVest it has such an Investment Manager.

The Board is reliant on the Investment Manager's screening processes, controls and priorities to address ESG matters within the investment portfolio in both the selection and oversight of investments. The Board believes that engagement with management of investee companies and funds is an effective way of driving meaningful change and takes considerable comfort from the extent of the Investment Manager's activity in this area, which is described on pages 13 to 15.

The Board receives regular updates from the Investment Manager on the development and implementation of its ESG policies and processes and the Board will continue to monitor those closely. These updates include information on the levels of engagement with investee companies and ESG issues in respect of their monitoring and selection of holdings in the Company's portfolio. This provides a valuable opportunity for the Board to confirm and challenge the Investment Manager to demonstrate that it is continuing to apply the highest standards of ESG practice across its investments and operations.

The Board recognises that the Investment Manager has been a signatory to the UN Principles for Responsible Investment ("PRI") since 2013, that it is committed to considering the potential impact that its investment and operational decisions could have, and that it encourages the GPs with which it invests to adopt the PRI. With regard to environmental and climate disclosures, the Investment Manager has started to report annually on its progress through its ESG report in line with the Recommendations of the TCFD. The Board has noted that the Investment Manager is a CarbonNeutral® company in accordance with The CarbonNeutral Protocol, a leading framework for carbon neutrality. The Investment Manager's offsetting programme delivers finance to emission reduction projects, supporting the transition to a low carbon economy. Finally, the Board also reviews the Investment Manager's approach to promoting diversity, social responsibility, and projects to combat social exclusion and enhance opportunities.

The Board is committed to incorporating ESG oversight across the Company's outsourced providers and within its own operations. Ms Espinal is the HVPE Director responsible for ESG matters. She helps to promote closer monitoring and further development in this area for the Company.

The Company's oversight of outsourced providers has been expanded to include questions and confirmations in respect of their ESG policies as part of its annual review of providers.

As an investment company with no direct employees, the core of the Company's ESG initiatives is derived from its oversight of its service providers, most importantly the Investment Manager. However, the Board also considers the application of ESG standards to its own activities as an Investment Company, including the following:

· Carbon Footprint: The Board has initiated a project to calculate its own carbon footprint with a view to achieving Carbon Neutral status, and will provide an update to shareholders in due course.

· Relations with Stakeholders: The Board will extend its interaction with its shareholders and other stakeholders to include a consideration of ESG matters. The Board has noted the governance and environmental benefits of broader shareholder participation facilitated by virtual shareholder events and will explore continuing to offer remote access where possible.

· Diversity and Inclusion: The Board's approach to diversity and inclusion is set out on page 51 and is reflected in the activities of the Nomination Committee. 43% of the Directors who are being proposed for re-election at the AGM are female, a figure well above the level recommended in the Hampton-Alexander Review. While it does not have a diversity target in mind, given the range of factors that this term necessarily covers, the Board will consider actively prioritising diversity in its next recruitment process.

· Position on Modern Slavery: The Board recognises the importance of the issues which the UK Modern Slavery Act 2015 is designed to address. It will expand its oversight of outsourced providers, including the Investment Manager, to include questions relating to their policies to combat Modern Slavery.

Significant Votes Against Policy

The Directors have adopted a policy whereby should 20% or more of votes be cast against a recommendation made by the Board for a resolution, the Company shall:

· explain, when announcing voting results, what actions it intends to take to consult shareholders in order to understand the reasons behind the result;

· no later than six months after the shareholder meeting publish an update on the views received from shareholders and actions taken; and

· provide a final summary in the Annual Report and, if applicable, in the explanatory notes to resolutions at the next shareholder meeting state what impact the feedback has had on the decisions the Board has taken and any actions or resolutions proposed.

No significant votes were received against any Board recommended resolution at the 2020 AGM.

Anti-bribery Policy

The Directors have undertaken to operate the business in an honest and ethical manner, and accordingly take a zero-tolerance approach to bribery and corruption, including the facilitation of corporate tax evasion. The key components of this approach are implemented as follows:

· The Board is committed to acting professionally, fairly and with integrity in all its business dealings and relationships.

· The Company implements and enforces effective procedures to counter bribery.

· The Company requires all its service providers and advisers to adopt equivalent or similar principles.

Disclosures Required Under LR 9.8.4R

The Financial Conduct Authority's Listing Rule 9.8.4R requires that the Company includes certain information relating to arrangements made between a controlling shareholder and the Company, waivers of Directors' fees, and long-term incentive schemes in force. The Directors confirm that there are no disclosures to be made in this regard.

Investment Manager

A description of how the Company has invested its assets, including a quantitative analysis, may be found on pages 1 to 39, with further information disclosed in the Notes to the Financial Statements on pages 75 to 83. The Board has considered the appointment of the Investment Manager and, in the opinion of the Directors, the continuing appointment of the Investment Manager on the terms agreed is in the interests of its shareholders as a whole.

In considering this appointment, the Board has reviewed the past performance of the Investment Manager, the engagement of the Investment Manager with shareholders and the Board, and the strategic plan presented to the Board by the Investment Manager.

The Investment Manager is HarbourVest Advisers L.P. and the principal contents of the Investment Management Agreement ("IMA") are as follows:

· to manage the assets of the Company (subject always to control and supervision by the Board and subject both to the investment policy of the Company and any restrictions contained in any prospectuses published by the Company);

· to assist the Company with shareholder liaison;

· to monitor compliance with the Investment Policy on a regular basis; and

· to nominate up to two Board representatives for election by shareholders at the Company's AGM.

The Investment Manager is not entitled to any direct remuneration (save expenses incurred in the performance of its duties) from the Company, instead deriving its fees from the management fees and carried interest payable by the Company on its investments in underlying HarbourVest Funds. The IMA, which was amended and restated on 30 July 2019, may be terminated by either party by giving 12 months' notice. In the event of termination within ten years and three months of the date of the listing on the Main Market, the Company would be required to pay a contribution, which would have been $3.9 million at 31 January 2021 and $3.7 million as at 30 April 2021, as reimbursement of the Investment Manager's remaining unamortised IPO costs. In addition, the Company would be required to pay a fee to the Investment Manager equal to the aggregate of the management fees for the underlying investments payable over the course of the 12-month period preceding the effective date of such termination.

Delegation of Responsibilities

Under the IMA, the Board has delegated to the Investment Manager substantial authority for carrying out the day-to-day management and operations of the Company, including making specific investment decisions, subject at all times to the control of, and review by, the Board. In particular, the IMA provides that the Board and the Investment Manager shall agree a strategy mandate which sets out a rolling five-year plan for the Company. The Board is responsible for the overall leadership of the Company and the setting of its values and standards. This includes setting the investment and business strategy and ongoing review of the Company's investment objective and investment policy, along with recommending to shareholders the approval of alterations thereto. Matters reserved for the Board include areas such as the Board and Committee membership, including the review and authorisation of any conflicts of interest arising. Areas such as approval of the raising of new capital, major financing facilities, and approval of contracts that are not in the ordinary course of business are also reserved for the Board, together with any governance and regulatory requirements. Any changes in relation to the capital structure of the Company, including the allotment and issuance of shares, are the responsibility of the Board.

Share Repurchase Programme

At the 2020 AGM, held on 22 July 2020, the Directors were granted authority to repurchase 11,971,387 Ordinary Shares (being equal to 14.99% of the aggregate number of Ordinary Shares in issue at the date of the AGM) for cancellation, or to be held as treasury shares. This authority, which has not been used, will expire at the upcoming AGM. The Directors intend to seek annual renewal of this authority from shareholders.

Introduction to the Going Concern and Viability Statement

Since the inception of HVPE, the Directors have relied upon model scenarios to manage the Company's liquidity requirements and balance sheet risk more generally. This modelling also allows the Directors to evaluate whether the Company is a Going Concern, as well as assess its Viability. While the modelling process has been refined over the years, it has provided a consistent approach through which the Directors have been able to make these assessments, as demonstrated through the GFC and the more recent COVID-19 pandemic. The Investment Manager typically updates the model scenarios annually in November, projecting NAV growth and cash flow for the subsequent five-year period. As highlighted on page 12, the onset of COVID-19 and the subsequent portfolio assessment undertaken by the Investment Manager, led the Company to also revise its models in May 2020. For the purpose of assessing the Going Concern and the Viability Statements over the respective assessment periods, the Investment Manager utilised the four model scenarios (Extreme Downside, Low, Base and Optimistic) presented to the Board in November 2020, which extend over the next five-year period through to 31 December 2025, and reflect the unexpectedly fast rebound following the initial COVID-19 shock. These were updated to reflect actual cash flows through to December 2020.

Going Concern

After due consideration, the Directors are satisfied that it is appropriate to continue to adopt the going concern basis in preparing the Financial Statements. This has been concluded following a review of the model scenarios presented by the Investment Manager compared to actual cash flows to date, making due enquiries of the Investment Manager, and being mindful of the closed-ended structure of the Company with no fixed life, as well as the nature of its investments. On this basis, the Directors consider that the Company is able to continue in operation for at least the next 12 months from the approval date of the Financial Statements. The Board monitors and manages its ongoing commitments via the criteria set out on pages 42 and 43 and reviews reports from the Investment Manager detailing ongoing commitments and the Investment Pipeline.

Furthermore, the Board, as part of its regular review of the Consolidated Statement of Assets and Liabilities and debt position, regularly considers the model scenario outputs that are based on a look-through to the anticipated underlying fund and portfolio cash flows.

Viability Statement

Pursuant to the UK Corporate Governance Code 2018 and the AIC Code, the Board has assessed the viability of the Company over the period from 31 January 2021 to 31 December 2025, which aligns with the timing of the Investment Manager's current five-year model scenarios. Whilst the Board has no reason to believe that the Company will not be viable over a longer period, it has chosen this period as it aligns with the Board's strategic horizon and is within the term of the Company's credit facility.

The Company's investment objective is to generate superior shareholder returns through long-term capital appreciation by investing primarily in a diversified portfolio of private markets investments. The majority of the Company's investments are in HarbourVest managed private equity fund-of-funds, which have fund lives of 10 to 14 years.

While the Company's investment lifecycle spans a time period of ten years or more, the Board currently focuses on a time period extending through to 31 December 2025 when considering the strategic planning of the Company, as discussed on pages 32 to 33 of this Annual Report. The strategic planning centres on building a portfolio of long-term assets through capital allocation into a set of rolling five-year calendar year end portfolio construction targets defined by investment stage, geography, and strategy. This rolling five-year process allows the Board a medium-term view of potential growth, projected cash flow and potential future commitments under various economic scenarios.

As part of its strategic planning, the Board considered model scenarios as explained above assuming varying degrees of impact on the portfolio. The Board primarily focused on two scenarios, the Base and Extreme Downside, the latter of which is a worst-case scenario that assumes large NAV declines and a material reduction in realisations from the underlying investment portfolio. Based on the unexpectedly robust recovery following the initial shock related to COVID-19, the Board concluded that the Company's cash balance and available credit facility would be sufficient to cover capital requirements under even the Extreme Downside scenario. The results of this modelling showed that the Company would be viable in the face of these scenarios occurring over the period ending 31 December 2025.

Statement of Directors' Responsibilities in Respect of the Financial Statements

The Directors are required to prepare Financial Statements for each financial year which give a true and fair view of the assets, liabilities, financial position, and profit or loss of the Company in accordance with US GAAP at the end of the financial year and of the gain or loss for that period. In preparing those Financial Statements, the Directors are required to:

· select suitable accounting policies and apply them consistently;

· make judgements and estimates that are reasonable and prudent;

· state whether applicable accounting standards have been followed subject to any material departures disclosed and explained in the Financial Statements; and

· prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the Financial Statements have been properly prepared in accordance with The Companies (Guernsey) Law, 2008. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors are responsible for ensuring that the Annual Report and Financial Statements include the information required by the Listing Rules and the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority (together "the Rules"). They are also responsible for ensuring that the Company complies with the provisions of the Rules which, with regard to corporate governance, require the Company to disclose how it has applied the principles, and complied with the provisions, of the corporate governance code applicable to the Company.

Disclosure of Information to the Auditor

So far as each of the Directors is aware, there is no relevant audit information of which the Company's auditor is unaware, and each has taken all the steps they ought to have taken as a Director to make themselves aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Responsibility Statement

The Board of Directors, as identified on pages 40 and 41, jointly and severally confirm that, to the best of their knowledge:

· the Financial Statements, prepared in accordance with US GAAP, give a true and fair view of the assets, liabilities, financial position, and profits of the Company and its undertakings;

· this report includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face; and

· the Annual Report and Financial Statements taken as a whole are fair, balanced, and understandable and provide the information necessary for shareholders to assess the Company and its undertakings' position, performance, business model, and strategy.

Signed on behalf of the Board by:

Ed Warner Chair

27 May 2021

Board Structure and Committees

The activities of the Company are overseen by the Board, which comprises a majority of independent Directors. The Board meets at least four times a year, and between these scheduled meetings there is regular contact between Directors, the Investment Manager, the Administrator and the Company Secretary, including a formal strategy meeting and Board update calls.

The Board aims to run the Company in a manner which is consistent with its belief in honesty, transparency and accountability. This is reflected in the way in which Board meetings are conducted, during which the Chair promotes and facilitates a culture of open and constructive debate on each topic, encouraging input from all Directors to ensure a wide exchange of views. The Directors believe that good governance means managing the affairs of the Company well and engaging effectively with investors. The Board is committed to maintaining high standards of financial reporting, transparency and business integrity.

* Libby Burne was appointed post financial year end, on 1 March 2021 and sits on the following committees: Audit and Risk Committee, Nomination Committee, Management Engagement and Service Provider Committee, and Remuneration Committee.

The Remuneration Committee, as described on page 57, was established after the financial year end.

Board and Committee Meetings with Director Attendance

In the financial year ended 31 January 2021, the Board held the following meetings. Below is a summary of the Director attendance at those meetings:

1 Sir Michael Bunbury retired in July 2020. Ms Burne was appointed on 1 March 2021 and therefore is not included in the table above.

The Directors are kept fully informed of investment and financial controls and other matters that are relevant to the business of the Company. Such information is brought to the attention of the Board by the Investment Manager, the Administrator and the Company Secretary in their regular reports to the Board. The Directors also have access where necessary, in the furtherance of their duties, to professional advice at the expense of the Company. Committee terms of reference (except for the Inside Information Committee), the schedule of matters reserved for the Board, the roles and responsibilities of the Chair, and the roles and responsibilities of the Senior Independent Director are available on the Company's website: www.hvpe.com/shareholder-information/corporate-governance.

A Remuneration Committee was formally established on 23 March 2021. This Committee has been established to determine the policy for Directors' remuneration, to set the remuneration of the Chair of the Board, and to consider the need to appoint external remuneration consultants.

All Directors received notice of the meetings, the agenda and supporting documents and were able to comment on the matters to be raised at the proposed meeting. During each meeting, the Chair promoted and facilitated open constructive debate on each topic, encouraging input from all Directors. As well as the formal scheduled strategy meeting, the Board also received detailed updates from the Investment Manager via update calls with particular reference to the impact on the Company of the pandemic. In addition to the above meetings, ad-hoc Board and Committee meetings are often convened at short notice and, as they only require a quorum of two Directors, there is a lower attendance than for the scheduled meetings. If any Director is unable to attend a meeting, they receive the papers and have the opportunity to discuss them with the Chair. During the financial year there were three ad-hoc Board meetings with a quorum at each.

At each scheduled Board meeting, amongst other items, the Directors review and discuss the Investment Manager's Report, HVPE's financial position, drivers of performance, how HVPE has performed, the commitment plan, and the corporate broking report (which includes an update on the Company's peer group). Marketing and investor relations are covered in detail at two Board meetings, and at a higher level at the remaining meetings.

Responsibilities

The Board has adopted formal responsibilities for the Chair and the Senior Independent Director as well as a schedule of matters reserved for the Board. All of these documents are available on the Company's website here: https://www.hvpe.com/shareholder-information/corporate-governance.

Board Composition

The Board demonstrates an appropriate balance of skills, experience and length of service, and the Directors believe that any changes to the Board's composition can be managed without undue disruption. The refreshment of the Board remains an ongoing process to ensure that the Board is well balanced. The Board's careful consideration of its composition and the ongoing refreshment process led to the addition of Ms Burne in March 2021. Further details on the selection and appointment process can be found in the Nomination Committee report on page 55.

All Directors are subject to annual re-election by shareholders. When a new Director is appointed to the Board, they will participate in a structured induction process. The Board actively engaged with the Investment Manager and Company Secretary to ensure that Ms Burne was given a detailed induction process comprising of multiple meetings with the Chair of the Board and Chair of the Audit and Risk Committee, key individuals within the Investment Manager, and other service providers.

With specific reference to Mr Moore's tenure, which has exceeded nine years, the Board is of the view that Directors can continue beyond this period, noting that they will be subject to continuing scrutiny as to their effectiveness and independence, and, as for all Directors, subject to annual re-election. The Board also believes there is strong value gained by there being a Director on the Board who has served since inception and has a complete historical working knowledge of HVPE. The Board confirms that Mr Moore remains independent of the Investment Manager with no other interests or conflicts with HarbourVest Partners, notwithstanding his years' service. This is evidenced by his continued constructive challenge of the Investment Manager. However, Mr Moore will step down from the Board at the upcoming AGM.

If a Director wishes to undertake additional external appointments, approval is sought from the Chair in order to confirm that the Director will be able to continue to dedicate sufficient time to carry out their duties as a Director of the Company and to assess any potential conflicts of interest and independence issues.

Tenure Policy

When considering its composition, the Board is strongly committed to striking the correct balance between the benefits of continuity, experience and knowledge and those that come from the introduction of Directors with diversity of perspectives and skills. Since the year end the Board has adopted a Tenure Policy confirming its intention that each Director will retire at the AGM immediately following the completion of their ninth year on the Board.

It is acknowledged that there could be unusual circumstances in which a short extension of that time period could be appropriate. In that event, a comprehensive explanation of the circumstances would be provided to stakeholders.

Board and Committees Evaluation

The Board undertakes a formal annual evaluation of its performance. This includes the Chair carrying out an individual review with each Director of their performance and contribution, and the Senior Independent Director leading an annual evaluation of the performance of the Chair.

The annual evaluation for the year was conducted internally by way of completion of detailed questionnaires and subsequent one-to-one conversations between the Chair and individual Directors and between the Senior Independent Director and the Chair. The key recommendations arising from the annual evaluation were then discussed at a Board meeting, and all identified actions are being progressed.

An externally facilitated Board evaluation occurs every three years and is next scheduled to take place in 2022.

Policy on Diversity and Inclusion

The Board and Nomination Committee actively consider the diversity of the Board when considering future appointments. The Board is pleased that, with the appointment of Ms Burne, it has exceeded the Hampton-Alexander Review target for 33% female representation on FTSE 350 company boards. The Company has no employees. As noted last year, the Board has also achieved the targeted ethnic diversity by the Parker Review ahead of the 2024 recommendation, with one of its seven Directors seeking re-election at the AGM being from an ethnic minority background.

The Board also recognises that diversity includes racial, socio-economic and other factors such as physical ability, and that different backgrounds and experiences can bring real value to the Company in terms of decision making. While it does not have any specific diversity target in mind, given the range of factors that this term necessarily covers, the Board will consider actively prioritising diversity in its next recruitment process.

Audit and Risk Committee

About the Committee

The Audit and Risk Committee members are outlined on page 49. Ms Barnes, Mr Hodson and Mr Moore each held senior banking roles for a number of years as described in their biographies on pages 40 and 41. Mr Wilderspin is a qualified Chartered Accountant and has over ten years' experience as an executive and non-executive director on a number of private and listed fund boards as well as commercial companies. Ms Burne became a member of this Committee on 1 March 2021 and is a former auditor with 20 years' experience. Members are deemed by the Board to have recent and relevant financial and sector experience.

The Audit and Risk Committee is responsible for the review of the Company's accounting policies, periodic Financial Statements and auditor engagement. The Committee is also responsible for both making appropriate recommendations to the Board, including that the Financial Statements are fair, balanced, and understandable, and for ensuring that the Company complies to the best of its ability with applicable laws and regulations while also adhering to the tenet of generally accepted codes of conduct. The Committee's terms of reference were extended in 2018 to incorporate responsibility for overseeing the Company's risk management framework and regulatory compliance.

All of the Company's management and administration functions are delegated to independent third parties or the Investment Manager and it is therefore felt that it would not be practical or cost effective for the Company to have its own internal audit facility. This matter is reviewed annually. The Audit and Risk Committee does have the power to commission third-party assurance work if it sees fit, but did not do so in the year under review.

Activities of the Committee

Audit and Risk Committee Meetings In the financial year ended 31 January 2021, the Audit and Risk Committee met seven times. A summary of Director attendance is included in the "Board and Committee Meetings with Director Attendance" section on page 50. In these meetings, the Committee considered the following matters:

Independent Auditor

The Audit and Risk Committee reviewed the effectiveness of the external audit process during the year, including audit quality, objectivity (level of challenge and professional scepticism), and independence. This included discussions with the Company's auditor, Investment Manager, and Company Secretary to review how well the previous year's audit had gone. The main conclusion from this review was that the audit process had gone well considering the additional problems brought by the pandemic. The extra time allowed by authorities to complete the audit had been helpful. The Committee was pleased with the engagement with the auditor regarding its work to gain comfort on the Directors' statements on going concern and viability, and the treatment of these matters in its report. The Committee concluded that Ernst & Young LLP's appointment as the Company's auditor should be continued.

The Company's auditor has been appointed to the Company since 2007 and was reappointed following a competitive tender process in May 2017. The partner responsible for the audit, Mr David Moore, will rotate off HVPE following the audit of these Financial Statements after having served five years, to comply with rotation requirements. The Company's auditor performed the audit of the Company's Financial Statements, prepared in accordance with applicable law, US GAAP and audited under both relevant US generally accepted auditing standards ("US GAAS") and International Standards on Auditing (UK). The audit approach remained substantially unchanged relative to the prior year.

Auditor Independence

The Audit and Risk Committee understands the importance of auditor independence and, during the year, the Committee reviewed the independence and objectivity of the Company's auditor. The Audit and Risk Committee received a report from the external auditor describing its independence, controls and current practices to safeguard and maintain auditor independence. The auditor reported one independence breach relating to a person closely associated with an associate partner of EY in the UK, outside the audit practice, holding a non-material direct financial interest in the Company. This financial interest was disposed of immediately after EY's compliance procedures picked the matter up. While disappointed, the Audit and Risk Committee was satisfied that the matter was dealt with by EY from a disciplinary and regulatory point of view, and the circumstances of the breach did not compromise the overall assessment that the auditor is independent. Other than fees paid for conducting a review of the Interim Financial Statements, there were no other non-audit fees paid to the auditor by the Company. The Committee has previously adopted a non-audit services policy, due to the adoption of the new Crown Dependency audit rules and guidance. In all cases the Committee reviews the potential engagement of the auditor in advance to ensure that the auditor is the most appropriate party to deliver the proposed services and to put in place safeguards, where appropriate, to manage any threats to auditor independence. This policy was revised after the year end to reflect the fact that the applicable provisions are now mandatory for the Company, and it now includes a cap on the cost of any non-audit services at 70% of the average of the previous three years' audit fees.

Terms of Engagement

The Audit and Risk Committee reviewed the audit scope and fee proposal set out by the auditor in its audit planning report and discussed the same with the auditor at an Audit and Risk Committee meeting. The Committee considered the proposed fees for Ernst & Young LLP's audit and interim review work of £212,000 for 2021. Whilst this is an 8.7% increase on the fee quote for its 2020 work, it is a reduction on final 2020 fees of £233,500. The 2020 fees were higher than quoted due to the additional work carried out by the auditor relating to COVD-19 factors, in particular regarding going concern and viability. The auditor made the case that the increase in quote for 2021 is justified because of additional procedures due to changes in auditing standards and the ongoing impact of COVID-19. Having been satisfied by the scope of the engagement letter and fee proposal, the Committee recommended that the Board should approve the fee proposal and letter of engagement.

Internal Controls

The internal control systems (including those related to cyber security) are designed to meet the Company's particular needs and the risks to which it is exposed. Accordingly, the internal control systems are designed to manage rather than eliminate the risk of failure to achieve business objectives and by their nature can only provide reasonable and not absolute assurance against misstatement and loss. The Company places reliance on the control environment of its service providers, including its independent Administrator and the Investment Manager. In order to satisfy itself that the controls in place at the Investment Manager are adequate, the Audit and Risk Committee has reviewed the Private Equity Fund Administration Report on Controls Placed in Operation and Tests of Operating Effectiveness ("Type II SOC I Report") for the period from 1 October 2019 to 30 September 2020 (a bridging letter covers the period 1 October 2020 to 31 January 2021), detailing the controls environment in place at the Investment Manager, as well as ISAE 3402 Reports on Fund Administration, Global and Local Custody Services, Securities Lending Services and Listed Derivatives Clearing Services for the period 1 October 2019 to 30 September 2020 detailing the controls environment in place at the Administrator and Company Secretary. In both of these reports there were minor findings, but the Committee is satisfied that the identified weaknesses were not material to the affairs of the Company, and that the respective service providers had taken action to improve controls in the identified areas. In addition, during the year, the MESPC conducted a detailed review of the performance of the Company's service providers, including the Investment Manager and Administrator.

The Investment Manager's Type II SOC I Report describes the internal controls in the HarbourVest Accounting group, which is responsible for maintaining the Company's accounting records and the production of the accounts contained in the Company's Financial Statements. The main features of the controls are: clearly documented valuation policies; detailed review of financial reporting from underlying limited partnerships and investee companies; detailed reconciliation of capital accounts in underlying limited partnerships; monthly reconciliation of bank accounts; and a multi-layered review of financial reporting to ensure compliance with accounting standards and other reporting obligations.

Risk Management

The Audit and Risk Committee reviewed the Company's risk management framework during the year, including the impact of COVID-19 on the Company and confirmed it was satisfied that it was appropriate for the Company's requirements. Further details of the principal risks and uncertainties facing the Company are given on pages 26 and 27. This is in accordance with relevant best practice as detailed in the FRC's guidance on Risk Management, Internal Control and Related Financial and Business Reporting. During the year, the Committee also considered emerging and topical risks and a "deep-dive" review of balance sheet risk was presented to the Board. The review of balance sheet risk included an analysis of the use of HarbourVest fund-level borrowing and the structural and policy constraints on the amount of such borrowing. Enhanced reporting to the Board was identified and implemented. An annual review of the Company's credit facility and lenders was also recommended.

Financial Risks

The Company is funded from equity balances, comprising issued Ordinary Share capital, as detailed in Note 1 to the Financial Statements, and retained earnings. The Company has access to borrowings pursuant to the credit facility of up to $600.0 million. As at 27 May 2021 $115.0 million was drawn down. Although the Company's currency exposure is currently not hedged, the Company's approach to hedging is kept under periodic review by the Audit and Risk Committee.

The Investment Manager and the Directors ensure that all investment activity is performed in accordance with the investment guidelines. The Company's investment activities expose it to various types of risks that are associated with the financial instruments and markets in which it invests. Risk is inherent in the Company's activities and it is managed through a process of ongoing identification, measurement, and monitoring. The financial risks to which the Company is exposed include market risk, credit risk, liquidity risk, and cash flow risk.

Regulatory Compliance

The Audit and Risk Committee has engaged with the Administrator's compliance team to ensure that the Company fulfils its regulatory obligations. A Compliance Monitoring Plan is in place and is regularly reviewed by the Committee.

Audited Financial Statements and Significant Reporting Matters

As part of the 31 January 2021 year-end audit, the Audit and Risk Committee reviewed and discussed the most relevant issues for the Company, most notably the risk of misstatement or manipulation of the valuation of its investments in underlying HarbourVest funds, and the impact of COVID-19, specifically with regard to the Board's statements on going concern and viability.

The Audit and Risk Committee remains satisfied that the valuation techniques used are appropriate for the Company's investments and consistent with the requirements of US GAAP. The Audit and Risk Committee ensures the Board is kept regularly informed of relevant updates/changes to US GAAP that impact the Company, including but not limited to valuation principles.

During the year the Audit and Risk Committee kept the risks associated with the pandemic and the measures adopted by HarbourVest and other service providers under review, to ensure continuity of service to the Company. The Committee also reviewed all of the Company's risks through the lens of COVID-19 and recommended changes to the Company's risk matrix. These are reflected in the Principal Risks and Uncertainties section on pages 26 and 27.

Corporate Governance

The Audit and Risk Committee continues to monitor the Board's assessment of the Company's compliance with the AIC Code of Corporate Governance for Investment Companies (the 2019 edition). As outlined in the Chair's Statement, during the financial year the Board initiated a search for its first dedicated HVPE Head of Corporate Governance and Alexandra Cornforth was appointed in April 2020.

Governance and Effectiveness

On 24 February 2021 the Committee conducted an internal review of its activities against its constitution and terms of reference in respect of the year under review and concluded that all requisite activities had been undertaken. Minor amendments to the terms of reference were proposed and approved. The Board evaluation process included a consideration of its Committees and concluded that they were used effectively.

Other Matters

The Audit and Risk Committee is currently considering the UK Government consultation on "Restoring trust in audit and corporate governance" which contains far-reaching proposals for reform. It will be assessing the implications of the proposals for the Company and will submit a response in due course.

In the current financial year, the Audit and Risk Committee will also be developing further the Company's risk management methodology.

In presenting this report, I have set out for the Company's shareholders the key areas that the Committee focuses on. If any shareholders would like any further information about how the Committee operates and its review process, I, or any of the other members of the Audit and Risk Committee, would be pleased to meet and discuss this with them.

Steven Wilderspin

Chair of the Audit and Risk Committee

27 May 2021

Nomination Committee

About the Committee

The Nomination Committee was established on 24 November 2015 and is chaired by the Chair of the Company. Its members are outlined on page 49.

There was one scheduled meeting held during the year. All members attended the meeting held. The mandate of the Nomination Committee is to consider issues related to the identification and appointment of Directors to the Board.

Activities of the Committee

Changes to Board Composition

In accordance with the approach to succession planning outlined below, Ms Libby Burne was appointed as a Director with effect from 1 March 2021. Sir Michael Bunbury retired in July 2020.

Approach to Succession Planning

To help facilitate an orderly succession process, the Nomination Committee considered the composition

requirements of the Board to ensure the requisite skills, knowledge, experience, and diversity were appropriate. Following this it prepared a role profile for a new Director and engaged Thomas & Dessain, recruitment consultants, to undertake the search. The Committee reviewed a long list of candidates, selected suitable candidates for first round interviews and proposed successful candidates for interview by the entire Board. In February 2021 the Committee made a formal recommendation to the Board that Libby Burne be appointed as a Director. The Board agreed with this recommendation and Ms Burne was appointed with effect from 1 March 2021.

Thomas & Dessain has no connections to the Company or its Directors.

Governance and Effectiveness

During the year, the Nomination Committee conducted a review of its activities against its constitution and terms of reference in respect of the year under review and concluded that it had satisfactorily complied with all of its terms of reference.

Management Engagement and Service Provider Committee

About the Committee

The MESPC was established on 24 November 2015 and is chaired by Ms Barnes. The members are outlined on page 49. The other Directors of the Company may attend by invitation of the Committee.

The MESPC held two meetings in the year under review and all members of the Committee attended the meetings.

Activities of the Committee

In the course of the year under review, the MESPC conducted a review of the Company's service providers to ensure the safe and accurate management and administration of the Company's affairs and business under terms which were competitive and reasonable for the shareholders.

Investment Manager Review

Due to the travel restrictions imposed by COVID-19, the annual Investment Manager review was undertaken virtually, in July 2020, rather than in person. As part of this review the Board received presentations from the investment committee, as well as various operational teams and the senior management of the Investment Manager regarding investment strategy and other matters relating to the Company's affairs, and discussed the conclusions of this review with the Investment Manager. The Board and MESPC Committee are satisfied with the performance of the Investment Manager with respect to investment returns and the overall level of service provided to the Company. It is anticipated that when the easing of travel restrictions allow, the Board as a whole will undertake visits to the Investment Manager's offices in Boston and London. In accordance with its terms of reference, the MESPC carries out a formal review of the Investment Management Agreement every three years and following that review will recommend any changes to the Board for consideration.

MESPC Review

The MESPC met in November 2020 and conducted a detailed review of the performance of all key service

providers to the Company for the year to January 2021 against the following criteria:

· scope of service;

· key personnel;

· key results achieved for the Company;

· fees charged to the Company;

· breaches and errors in the year under review;

· ESG policies and initiatives;

· cyber security and IT controls environment; and

· General Data Protection Regulation ("GDPR") compliance.

Governance and Effectiveness

In November 2020, the MESPC conducted a review of its activities against its constitution and terms of reference in respect of the year under review and concluded that it had satisfactorily complied with all of its terms of reference.

Remuneration Committee

About the Committee

The Remuneration Committee was established on 23 March 2021 and will be chaired by Mr Hodson, as the Senior Independent Director of the Company. The members are Ms Barnes, Ms Burne, Mr Moore, Mr Warner and, Mr Wilderspin. The other Directors of the Company may attend by invitation of the Committee.

The Remuneration Committee has delegated responsibility for determining the policy for Directors' remuneration and setting the remuneration of the Chair of the Board. The Committee will also make recommendations to the Board for the Directors' remuneration levels which shall be determined in accordance with the Company's Articles of Association. Remuneration will not include performance related elements. The Committee terms of reference can be found on the HVPE website here: www.hvpe.com/shareholder-information/corporate-governance.

The Committee will meet at least once a year. No meeting has been held to date but will take place later in 2021.

Inside Information Committee

About the Committee

The Committee was formed on 12 July 2016 to consider information which may need to be made public in order for the Company to comply with its obligations under the UK Market Abuse Regulation ("UK MAR"). It met three times during the year and issued two flash NAV per share updates as a result of the meetings. The terms of reference for this Committee were updated to reflect post-Brexit regulation.

Directors' Remuneration Report

An ordinary resolution for the approval of this Directors' Remuneration Report will be put to shareholders at the forthcoming AGM to be held in 2021.

There are no long-term incentive schemes provided by the Company and no performance fees are paid to Directors. Directors affiliated to HarbourVest do not receive any fees.

No Director has a service contract with the Company; however, each Director is appointed by a letter of appointment which sets out the terms of the appointment.

Directors are remunerated in the form of fees, payable quarterly in arrears to the Director personally. The table below details the fees paid to each Director of the Company for the years ended 31 January 2020 and 31 January 2021. The Company's Articles limit the aggregate fees payable to Directors to a maximum of £550,000 per annum. The Board reviewed remuneration in the year and no changes were made.

Under the Company's Articles, Directors are entitled to additional ad-hoc remuneration for project work outside of the scope of their ordinary duties. No such payments were made in the year ended 31 January 2021.

1 Sir Michael Bunbury was the Chair until 22 July 2020 when Mr Ed Warner was appointed to this role.

2 Ms Burne was appointed with effect from 1 March 2021.

3 Reduced from £140,000 to £100,000 with effect from 22 July 2020.

Signed on behalf of the Board by:

Ed Warner Steven Wilderspin

Chair Chair of the Audit and Risk Committee

27 May 2021

Statement of Compliance with the AIC Code of Corporate Governance

The Directors place a large degree of importance on ensuring that high standards of corporate governance are maintained and aim to comply as much as possible with the provisions of the AIC Code published in February 2019.

The Board has considered the principles and provisions of the AIC Code. The AIC Code addresses all the principles and provisions set out in the 2018 UK Corporate Governance Code (the "UK Code"), as well as setting out additional provisions on issues that are of specific relevance to the Company. The AIC Code has been endorsed by the Financial Reporting Council ("FRC") and the Guernsey Financial Services Commission ("GFSC"). By reporting against the AIC Code, the Company is meeting its obligations under the UK Code, the 2011 GFSC Finance Sector Code of Corporate Governance and the associated disclosure requirements set out under paragraph 9.8.6R of the Financial Conduct Authority's ("FCA's") Listing Rules. The Board considers that reporting against the principles and provisions of the AIC Code provides more relevant information to stakeholders. The AIC Code is available on the AIC website: www.theaic.co.uk.

The Company complied with all the principles and provisions of the AIC Code during the year ended 31 January 2021 except for two items which were resolved after the year end but prior to publication of the Annual Accounts and an additional difference relating to the duties of the Nomination Committee. Details on these three exceptions are outlined below.

Policy on the Tenure of the Chair

The Board did not have a formal policy on tenure, including the tenure of the Chair, until March 2021 when such a policy was established.

Remuneration Committee

During the period under review, the entire Board acted as the Remuneration Committee. The Board established a separate Remuneration Committee on 23 March 2021. Terms of reference are available on the Company's website.

The following item is an ongoing exception to one of the principles of the AIC Code:

The Duties of the Nomination Committee

As set out on page 55, the Board has established a Nomination Committee, but it has chosen to limit its remit to focus purely on the identification and nomination of Board candidates to fill Independent Director Board vacancies as and when they arise. Other matters relating to the structure, size and composition of the Board and plans in respect of tenure and succession for Independent Directors form part of the matters reserved for the entire Board. The Directors believe that their deliberations in relation to these matters benefit from the input from all the Directors, including those appointed by HarbourVest.

Set out below is where stakeholders can find further information within the Annual Report about how the Company has complied with the various principles and provisions of the AIC Code.

Independent Auditor's Report

to the Members of HarbourVest Global Private Equity Limited

Opinion

We have audited the consolidated financial statements (the "Financial Statements") of HarbourVest Global Private Equity Limited (the "Company") and its subsidiaries (together the "Group") for the year ended 31 January 2021 which comprise the Consolidated Statements of Assets and Liabilities, the Consolidated Statements of Operations, the Consolidated Statements of Changes in Net Assets, the Consolidated Statement of Cash Flows, the Consolidated Schedule of Investments, and the related notes 1 to 11, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United States Generally Accepted Accounting Principles ("US GAAP").

In our opinion, the Financial Statements:

· give a true and fair view of the state of the Group's affairs as at 31 January 2021 and of its profit for the year then ended;

· have been properly prepared in accordance with US GAAP; and

· have been properly prepared in accordance with the requirements of the Companies (Guernsey) Law, 2008.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) ("ISAs (UK)") and applicable law. Our responsibilities under those standards are further described in the "Auditor's responsibilities for the audit of the Financial Statements" section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the Financial Statements, including the UK FRC's Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the Financial Statements, we have concluded that the Directors' use of the going concern basis of accounting in the preparation of the Financial Statements is appropriate. Our evaluation of the Directors' assessment of the Group's ability to continue to adopt the going concern basis of accounting included:

· We discussed with the Directors their assessment of going concern, which included four scenario analysis models, including the 'Base Case' and 'Extreme Downside' scenarios, the 'Base Case' being considered by the Directors to be the most likely scenario;

· We ascertained that the going concern assessment covered a period up until 30 June 2022 from the date of approval of the financial statements;

· We reviewed the arithmetical accuracy of the 'Base Case' and 'Extreme Downside' scenario models;

· For the 'Base Case' scenario we reviewed the working capital documentation which supports the Directors' assessment of going concern;

· We considered the estimation uncertainty of the prior year's most likely scenario by comparing it to the Group's actual performance to date, discussed the material movements with the Board and the Investment Manager, and obtained the required supporting documentation;

· For the 'Extreme Downside' scenario we challenged the sensitivities and assumptions used in the forecast through reverse stress testing to understand how severe the downside scenario would have to be to result in the elimination of liquidity headroom or a covenant breach;

· We selected judgementally a sample of underlying transactions and discussed the associated Cashflow Curve assumptions with the Investment Manager, including relevant supporting evidence;

· We held discussions with the Audit Committee and Investment Manager to determine whether, in their opinion, there is any material uncertainty regarding the Company's ability to pay liabilities and commitments as they fall due. Through these discussions we considered and challenged the options available to the Company if it were in a stressed scenario. These options included but were not limited to the use of credit facilities and sales in the secondary market;

· We assessed whether the commitments made to underlying investments casted significant doubt over the going concern status of the Group and compared the historical calls made by underlying investments as a % of the total commitments made, including a discussion with the Investment Manager regarding the possibility for uncalled commitments to be called;

· We confirmed available bank facility balances to understand the potential impact of the leverage in the underlying funds;

· At year end, we recalculated the 3 covenant ratios applicable to the bank facility; the 35% Total Asset Ratio, the 47% Total Asset Ratio, and the Total Commitment Ratio (alternatively known as the Bank Test Ratio);

· We considered whether the Directors' assessment of going concern as included in the Annual Report is appropriate and consistent with the disclosure in the viability statement; and

· We evaluated the disclosures made in the Annual Report and Consolidated Financial Statements regarding going concern to ascertain that they are in accordance with US GAAP and have complied with, or explained reasons for non-compliance, with all the AIC Code of Corporate Governance provisions.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's ability to continue as a going concern over a period from the date of approval of the Financial Statements up until 30 June 2022.

In relation to the Group's reporting on how they have applied the UK Corporate Governance Code, we have nothing material to add or draw attention to in relation to the Directors' statement in the Financial Statements about whether the Directors considered it appropriate to adopt the going concern basis of accounting.

Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report. However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Group's ability to continue as a going concern.

Overview of our audit approach

An overview of the scope of our audit

Tailoring the scope

Our assessment of audit risk, our evaluation of materiality and our allocation of performance materiality determine our audit scope for each Company within the Group. Taken together, this enables us to form an opinion on the Financial Statements. We take into account size, risk profile, the organisation of the Group and effectiveness of controls, including changes in the business environment when assessing the level of work to be performed.

The audit was led from Guernsey and utilised audit team members from the Boston office of Ernst & Young LLP in the US. We operated as an integrated audit team across the two jurisdictions and we performed audit procedures and responded to the risk identified as described below.

The Group comprises the Company and its five wholly owned subsidiaries as explained in note 2 to the Financial Statements. The Company, each subsidiary and the consolidation are subject to full scope audit procedures. Other than the investments which the Company holds directly, the subsidiaries own the investments, which are set out in the Consolidated Schedule of Investments, and on which we performed our work on valuation.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the Financial Statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit, and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the Financial Statements as a whole, and in our opinion thereon, and we do not provide a separate opinion on these matters.

Our application of materiality

We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified misstatements on the audit and in forming our audit opinion.

Materiality

"Materiality" is the magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to influence the economic decisions of the users of the financial statements. Materiality provides a basis for determining the nature and extent of our audit procedures.

We determined materiality for the Group to be $57.5 million (2020: $44.0 million), which is 2% (2020: 2%) of net assets. We believe that net assets provide us with a basis for determining the nature, timing and extent of risk assessment procedures, identifying and assessing the risk of material misstatement and determining the nature, timing and extent of further audit procedures. We used the net assets as a basis for determining planning materiality because the Group's primary performance measures for internal and external reporting are based on net assets as we consider it is the measure most relevant to the stakeholders of the Group.

We calculated materiality during the planning stage of the audit and during the course of our audit we reassessed initial materiality based on 31 January 2021 net assets.

Performance materiality

"Performance materiality" is the application of materiality at the individual account or balance level. It is set at an amount to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality.

On the basis of our risk assessments, together with our assessment of the Group's overall control environment, our judgement was that performance materiality was 75% (2020: 75%) of our planning materiality, namely $43.1m (2020: $33.0m). Our objective in adopting this approach was to ensure that total uncorrected and undetected audit differences in the Financial Statements did not exceed our materiality level. We have set performance materiality at this percentage given that there is no history of material misstatements, the likelihood of misstatement in the future is deemed low, we have a strong understanding of the control environment, there were no changes in circumstances (such as a change in accounting personnel or events out of the normal course of business) and it is not a close monitored audit, and hence we consider 75% to be reasonable.

Reporting threshold

"Reporting threshold" is an amount below which identified misstatements are considered as being clearly trivial.

We agreed with the Audit Committee that we would report to them all uncorrected audit differences in excess of $2.9m (2020: $2.2m), which is set at 5% of planning materiality, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds.

We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed above and in light of other relevant qualitative considerations in forming our opinion.

Other information

The other information comprises the information included in the annual report, other than the Financial Statements and our auditor's report thereon. The Directors are responsible for the other information contained within the annual report.

Our opinion on the Financial Statements does not cover the other information and, except to the extent otherwise explicitly stated in this report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the Financial Statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the Financial Statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of the other information, we are required to report that fact.

We have nothing to report in this regard.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which the Companies (Guernsey) Law, 2008 requires us to report to you if, in our opinion:

· proper accounting records have not been kept by the Company; or

· the Financial Statements are not in agreement with the Company's accounting records and returns; or

· we have not received all the information and explanations we require for our audit.

Corporate Governance Statement

The Listing Rules require us to review the Directors' statement in relation to going concern, longer-term viability and that part of the Corporate Governance Statement relating to the Group's compliance with the provisions of the UK Corporate Governance Code specified for our review.

Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the Corporate Governance Statement is materially consistent with the Financial Statements or our knowledge obtained during the audit:

· Directors' statement with regards to the appropriateness of adopting the going concern basis of accounting and any material uncertainties identified set out on page 47;

· Directors' explanation as to its assessment of the Company's prospects, the period this assessment covers and why the period is appropriate set out on page 47;

· Directors' statement on fair, balanced and understandable set out on page 48;

· Board's confirmation that it has carried out a robust assessment of the emerging and principal risks set out on pages 26 and 27;

· The section of the annual report that describes the review of effectiveness of risk management and internal control systems set out on page 53; and

· The section describing the work of the audit committee set out on page 52.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page 48, the Directors are responsible for the preparation of the Financial Statements and for being satisfied that they give a true and fair view, and for such internal control as the Directors determine is necessary to enable the preparation of Financial Statements that are free from material misstatement, whether due to fraud or error.

In preparing the Financial Statements, the Directors are responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Financial Statements.

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect irregularities, including fraud. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.

However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the Group and management. Our approach was as follows:

· We obtained an understanding of the legal and regulatory frameworks that are applicable to the Group and determined that the most significant are:

· Financial Conduct Authority ("FCA") Listing Rules;

· Disclosure Guidance and Transparency Rules ("DTR") of the FCA;

· The 2018 UK Corporate Governance Code;

· The 2019 AIC Code of Corporate Governance;

· The Companies (Guernsey) Law, 2008, as amended; and

· The Protection of Investors (Bailiwick of Guernsey) Law 1987, as amended.

· We understood how the Group is complying with those frameworks by:

· Discussing the processes and procedures used by the Directors, the Investment Manager, the Company Secretary and Administrator to ensure compliance with the relevant frameworks;

· Inspecting the Group's relevant documented policies, processes and procedures; and

· Reviewing internal reports that evidence compliance testing.

· We assessed the susceptibility of the Group's Financial Statements to material misstatement, including how fraud might occur by undertaking the audit procedures set out in the Key Audit Matters section above, and reading the Financial Statements to check that the disclosures are consistent with the relevant regulatory requirements; and

· Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Our procedures involved:

· Having discussions with those charged with governance, the Investment Manager, the Company Secretary and Administrator to obtain an understanding of how instances of non-compliance with relevant laws and regulations are identified;

· Reviewing Board minutes and internal compliance reporting;

· Inspecting correspondence with regulators;

· Reviewing the Financial Statements to check that they comply with the reporting requirements of the Group; and

· Obtaining relevant written representations from the Board of Directors.

A further description of our responsibilities for the audit of the Financial Statements is located on the Financial Reporting Council's website at: https://www.frc.org.uk/auditors responsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the Company's members, as a body, in accordance with Section 262 of the Companies (Guernsey) Law 2008. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members as a body, for our audit work, for this report, or for the opinions we have formed.

David Robert John Moore, ACAFor and on behalf of Ernst & Young LLPGuernsey

27 May 2021

Notes:

1 The maintenance and integrity of the Company's website is the sole responsibility of the Directors; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditor accepts no responsibility for any changes that may have occurred to the Financial Statements since they were initially presented on the website.

2 Legislation in Guernsey governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Independent Auditor's Report

to the Directors of HarbourVest Global Private Equity Limited

We have audited the accompanying Consolidated Financial Statements ("Financial Statements") of HarbourVest Global Private Equity Limited (the "Company") and its subsidiaries (together the "Group"), which comprise the Consolidated Statement of Assets and Liabilities as at 31 January 2021, and the related Consolidated Statement of Operations, the Consolidated Statements of Changes in Net Assets, the Consolidated Statements of Cash Flows, the Consolidated Schedule of Investments, and the related notes 1 to 11 to the Financial Statements.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these Financial Statements in conformity with United States Generally Accepted Accounting Principles ('US GAAP'). This includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of Financial Statements that are free of material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these Financial Statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the Financial Statements are free of material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Financial Statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the Financial Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal controls relevant to the Company's preparation and fair presentation of the Financial Statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the Financial Statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the Financial Statements referred to above present fairly, in all material respects, the financial position of HarbourVest Global Private Equity Limited at 31 January 2021, and the results of its operations, changes in net assets, and its cash flows for the year then ended, in conformity with US GAAP.

Ernst & Young LLPGuernsey, Channel Islands

27 May 2021

Consolidated Statements of Assets and Liabilities

At 31 January 2021 and 2020

The accompanying notes are an integral part of the Financial Statements.

The Financial Statements on pages 67 to 83 were approved by the Board on 27 May 2021 and were signed on its behalf by:

Ed Warner Steven Wilderspin Chair Chair of the Audit and Risk Committee

Consolidated Statements of Operations

For the Years Ended 31 January 2021 and 2020

The accompanying notes are an integral part of the Financial Statements.

Consolidated Statements of Changes in Net Assets

For the Years Ended 31 January 2021 and 2020

The accompanying notes are an integral part of the Financial Statements.

Consolidated Statements of Cash Flows

For the Years Ended 31 January 2021 and 2020

The accompanying notes are an integral part of the Financial Statements.

Consolidated Schedule of Investments

At 31 January 2021

* Includes purchase of limited partner interests for shares and cash at the time of HVPE's IPO.

† Includes ownership interests in HarbourVest Partners VII-Cayman Partnership entities.

‡ Includes ownership interest in Dover Street VII (AIV 1) Cayman L.P.

§ Fund denominated in euros. Commitment amount is €47,450,000.

** Fund denominated in euros. Commitment amount is €100,000,000.

†† Fund denominated in euros. Commitment amount is €63,000,000.

‡‡ Fund denominated in Canadian dollars. Commitment amount is C$32,000,000.

As of 31 January 2021, the cost basis of partnership investments is $1,890,413,031.

The accompanying notes are an integral part of the Financial Statements.

Consolidated Schedule of Investments

At 31 January 2020