Responsible Investing at Fisher Investments

FI generally evaluates and integrates Sustainability Risks and ESG factors at multiple stages throughout the investment process. “Sustainability Risk” is defined by SFDR as an environmental, social or governance event or condition that, if it occurs, could cause a negative material impact on the value of the investment.

Top-Down Investment Process

Sustainability Risks and ESG factors are among the many drivers considered by FI’s Capital Markets Analysts and FI’s Investment Policy Committee (“IPC”) when developing country, sector and thematic preferences. Environmental regulation, social policy, economic and market reforms, labour, and human rights are among the ESG factors assessed when determining country and sector/industry allocations and shaping an initial prospect list of portfolio positions.

FI’s IPC, with the assistance of FI’s Securities and Capital Markets Analysts, determines the materiality of the ESG considerations based on the exposure among publicly-traded companies in these categories. Higher materiality could imply larger ESG-related risks or opportunities, and may influence sector and country weight preferences as well as individual stock selection. The investment strategy and positioning reflects FI’s outlook over a 12-18 month horizon.

Bottom-Up Investment Process

FI’s Securities Analysts perform fundamental research on prospective investments to identify securities with strategic attributes consistent with FI’s top-down views and competitive advantages relative to their defined peer group. The fundamental research process involves reviewing and evaluating a comprehensive set of qualitative and quantitative data, including ESG factors, prior to purchasing a security. Factors considered in portfolios include, but are not limited to: shareholder concentration, corporate stewardship, environmental opportunities & liabilities, and human or labour rights controversies. FI would choose not to invest in companies when, in its opinion, security level ESG issues: (i) violate a client mandated ESG policy, (ii) present an inordinate risk to a company’s operational or financial performance or (iii) appear to present undue headline risk to share price performance.

Given that FII outsources the portfolio management function to FI, it is not currently envisaged that the consideration of Sustainability Risks will be of primary relevance to the functions performed by FII staff. Accordingly, FII does not currently anticipate consideration of Sustainability Risks as being a significant factor in the assessment of FII’s staff members’ variable remuneration.

Notwithstanding that the consideration of Sustainability Risks is integrated into FI’s investment decision-making process, by virtue of FII’s size, FII is not required and currently elects not to consider the adverse impacts of its investment decisions on environmental, social or employee matters, respect for human rights, or anti-corruption or anti-bribery matters (“Sustainability Factors”) in respect of all portfolios it manages. However, with respect to strategies that promote environmental or social characteristics or have a sustainable investment objective (an “ESG Strategy”), the sustainability-related disclosures provided below for each ESG Strategy describes how principal adverse impacts on Sustainability Factors are considered by FI, including to what extent the indicators listed in Table 1 of Annex I of the Commission Delegated Regulation (EU) 2022/1288 (the “SFDR RTS”) are taken into consideration by FI. Furthermore, for institutional clients who have an ESG Strategy implemented in their investment portfolio, such institutional clients will receive pre-contractual disclosures related to their investment portfolio that will describe how principal adverse impacts on Sustainability Factors are considered by FI in their investment portfolio.

FII makes available to its institutional clients certain ESG Strategies that can be implemented in an institutional client’s investment portfolio. By implementing an ESG Strategy in an institutional client’s investment portfolio, such portfolio is considered an Article 8 or Article 9 financial product under SFDR, which requires certain portfolio-specific disclosures to be provided on FII’s website. However, FII considers the management of its institutional client’s investment portfolio to be confidential, and will not publish portfolio-specific sustainability disclosures on its website. Instead, FII publishes the below information about the ESG Strategies at the model level, which will include SFDR periodic reporting on the performance of such ESG Strategies from a sustainability perspective.

• Article 8 Strategies
  • Fisher Investments Emerging Markets Equity ESG
  • Fisher Investments Emerging Markets Equity Paris Aligned
  • Fisher Investments Emerging Markets Responsible Equity ex Fossil Fuels
  • Fisher Investments Global Developed Equity ESG
  • Fisher Investments Global Developed Concentrated Equity ESG
  • Fisher Investments Global Equity ESG
  • Fisher Investments Global Ex-US Equity ESG
  • Fisher Investments Global Small Cap Equity ESG
  • Fisher Investments Quantitative Global Equity ESG
  • Fisher Investments US All Cap Equity ESG
  • Fisher Investments US Equity ESG
  • Fisher Investments US Small Cap Core Equity ESG
  • Translations: Please click here to view translated summaries for each of these sustainability-related disclosures.

• Article 9 Strategies
  • Fisher Investments Global Sustainable Equity Impact ESG
  • Translations: Please click here to view translated summaries for each of these sustainability-related disclosures.

Should any changes be made to this disclosure in the future, a clear explanation of such changes will be published here.

Implemented Changes

In January 2022, this disclosure was updated to:

• reflect the postponement of the SFDR RTS effective date to January 2023;
• address SFDR and Taxonomy Regulation periodic reporting; and
• modify the strategy line-up in the Sustainability-Related Disclosures section; and
• adding disclosures regarding the Taxonomy Regulation.

In December 2022, this disclosure was updated to:

• update the sustainability-related disclosures for the ESG Strategies to comply with the SFDR RTS;
• remove the principal adverse impact statement that was originally posted to comply with SFDR on a high level, principles basis; and
• remove disclosures not required under SFDR or the Taxonomy Regulation (Regulation EU/2020/852).