Climate Change and Banking: What Can You Do? Intentional Endowments Forum - Loyola College November 1st , 2016 Multi marketing Lisa Hayles, Institutional Investment Services SAN FRANCISCO 111 Pine Street, Suite 1420 San Francisco, CA 94111 Tel: (415) 757-5760 BOSTON – MAIN OFFICE 84 State Street, Suite 940 Boston, MA 02109 Tel: (617) 720-5557 Web: www.bostoncommonasset.com Email: invest@bostoncommonasset.com

Boston Common Asset Management Firm Overview Environmental, social, and governance (ESG) integrated investing U.S., International, and Global equities with long-term focus Over $2 billion in assets under management* Shareowner Engagement has meaningfully improved corporate practices here & abroad Employee-owned: seasoned team, global experience, women- and minority-owned Responsible practices: Boston Common is now a Certified B Corporation™, joining a community of over 1800 global companies seeking to use business as a force for good™ Leadership on ESG: Winner of 2016 Envestnet Impact Award, SMA Impact Manager & Strategist of the Year Early signatory/ambassador: Montreal Carbon Pledge to measure & report portfolio carbon footprint Geeta Aiyer holds an elected position on the UN-supported Principles for Responsible Investment Highlight integrated process – not an add-on or product. At inception through to shareholder engagement, which Lisa will speak to, etc. Principals in firm have worked in ESG for 25+ years. Among founding ESG investing firms in U.S. PRI – large, global movement $59 trillion in assets 2nd U.S. asset manager signatory to Montreal Carbon pledge *As of 9/30/2016, including sub-advised assets

Integrating ESG Factors into Investment Decision-making Our Investment Thesis: A long term view is necessary to generate sustainable returns. ESG integration maximizes opportunities and minimizes risk. We seek investments in well-governed and innovative companies that are industry leaders or are creating solutions to society's challenges. Active shareowner engagement promotes long-term thinking, improves company fundamentals. We implement Comprehensive ESG Guidelines that aim to: Promote sustainable energy production and use Mitigate climate risk Promote responsible water stewardship Environmental Social Governance client Protect human rights Promote gender and income equality Advocate for global health Support ethical, transparent, and accountable corporate culture

Active Ownership Strategies Sustained Dialogue Public Policy Participation Proxy Voting Promote Long-term Thinking, Transparency & Accountability Hand off to Lisa Employ a range of active ownership strategies In past 2 years, collaborated on 230 shareholder engagement campaigns Engagement framework/process for transparency, accountability, focused on sustainable, long-term value building Engagement improves fundamentals of companies Outcomes result of sustained, tenacious dialogue over long-term International Collaboration Setting Standards & Metrics Resolutions & Annual Meetings

Engagement Case Study —Financing Climate Change July 2014 Boston Common published Financing Climate Change: Carbon Risk in the Banking Sector Analyzed 45 banks across 10 key metrics Banks & Climate Change Impact Report Research Conducted Baseline Assessment of Bank Practices (CDP Carbon, Industry Associations, Key Climate Change Activities) July –September 2014 Letters sent to 61 banks September 2014 Engagement Organized Investor Coalition of 80 investors with over $500 billion in assets under management July- September 2014 client Active Engagement with 22 banks by lead investors October 2014-August 2015 Results June 2015-September 2015

Key Questions Risk Management - Integration of climate considerations into risk management procedures. Specifically, does the bank: Conduct regular stress tests that model the effects of adverse climate events? Rebalance portfolios in view of potential climate-related risks? Consider the climate-related legal and reputational risks of investments? Reassess loan pricing with an eye to climate-related changes in consumer behavior, including potential shifts in demand for high-carbon fuels? Climate Strategy - Implementation of long-term climate change strategy. Specifically, does the bank: Measure and disclose its total carbon footprint including that associated with its lending and underwriting portfolio? Align banker compensation with long-term climate goals? Incorporate climate considerations into board oversight mandates? Opportunities - Identification of opportunities associated with climate change. Specifically, does the bank offer, or is considering introducing, products and/or services that: Increase energy efficiency? Produce renewable energy? Promote climate change adaptation or mitigation? client

Dedicated to the pursuit of financial return & social change Boston Common has a long history of integrating our ESG investment process to align significantly with Catholic Bishops’ guidelines. What Can You Do? Support shareholder resolutions focused on climate lobbying disclosure, sustainability reporting, or other climate related metrics Join CDP as a supporting signatory Ask your investment managers to do a portfolio level carbon footprint analysis Invest in low(er) carbon strategies “commercial” why you should work with us/how we will work with you Would be an honor to work with you Compelling fee proposal in first page of appendix Dedicated to the pursuit of financial return & social change Web: www.bostoncommonasset.com Email: lhayles@bostoncommonasset.com