SUSTAINABLE INVESTMENTS SUSTAINABILITY FRAMEWORK FOR INVESTORS Lysis Bourget-Vennin Suday Jain Vanessa Caron Jimmy Huang

AGENDA 1.Defining sustainability – Market angle 2.Our definition 3.Sustainable Investment strategy 4.Evaluation of the Funds 5.Conclusion

DEFINING SUSTAINABILITY – MARKET ANGLE sustainable investment means taking account of environmental, social and governance factors - known as ESG - across all our day-to-day investment business. - CalPERS Manifacturing sustainability - beyond green - GE sustainability means making every day better for people and the planet through how we innovate and how we act. – P&G principle of a triple-bottom-line. This means managing our operations and growth plans in a way that enhances social and economic benefits, while striving to minimize the environmental impact associated with development. - Suncor committed to developing the most efficient power systems in the world. This helps the environment and our customers by enabling them to do more, using less. –Rolls Royce We view sustainability from two perspectives: one, as a valuable tool and skill set we offer our clients, from life cycle analysis to reducing environmental impact to community engagement ; and two, as the most compelling way to conduct ourselves professionally and live up to our employees’ expectations –SNC Lanvlin

SUSTAINABILITY - REVISITED Sustainable investment should equally be based on financial metrics and performance metrics, namely, ESG. Improving social and environmental performance Positive impact on society Maintaining financial goals Input and outputs are not being depleted over time 3 factors or equal importance: Environmental, social, and governance. Long-term vision for innovation and growth, consideration for the future

ENVIRONMENT, SOCIAL AND GOVERNANCE, OR ‘ESG,’ PERFORMANCE, IS WHERE SUSTAINABILITY AND CAPITAL MARKETS CONVERGE.

SUSTAINABLE INVESTMENT STRATEGY ESG Financial Performance Sustainable Investments

INVESTMENT STRATEGY - CRITERIAS Interdependence of ESG factors No tradeoffs between financial returns and ESG performance Morally conscientious investing Financial critieria: Benchmark, expense ratio, turnover ratio, asset class, total rate of return, confidence intervals

ENVIRONMENTAL SUSTAINABILITY, SOCIAL RESPONSIBILITY, AND GOOD GOVERNANCE ARE INTERDEPENDENT Environmental sustainability Social Responsibility Good Governance

NO TRADEOFFS BETWEEN FINANCIAL PERFORMANCE AND ESG Sustainability is the root of innovation Correlation between financial performance, not causation Equal weights for both financial data and ESG

MORALLY CONSCIENTIOUS INVESTING Consulting a moral stance on the question of human freedom and autonomy, we believe: We should focus efforts towards investing in companies that promotes the prevention of negative externalities We should not be divesting in companies that offer socially irreesponsible goods and services

MORALLY CONSCIENTIOUS INVESTING No judgement on what activities free agents should or should not engage in because: There is no quantitative method to measure harm Undermines human agency and autonomy Sustainable efforts should not be based on arbitrary values which investors impose onto others Focus on preventing harm originating from an external source

Benchmark Expense Ratio Turnover Ratio Asset Class FINANCIAL CRITERIA

ABBE SRI FUND

3-year rate of return: % 3-year benchmark (Russell 2000 index): % Expense Ratio: 1.25% Turnover Ratio: 252% Asset Class: Small Growth

WINSLOW GREEN GROWTH FUND

3-year rate of return: % 3-year benchmark (Morningstar Small Cap Core): % Expense Ratio: 1.20% Turnover Ratio: 113% Asset Class: Mid-Cap Growth

CALVERT SOCIAL INVESTMENT EQUITY FUND

3-year rate of return: -3.68% 3-year benchmark (S&P 500): % Expense Ratio: 0.67% Turnover Ratio: 51% Asset Class: Large Growth

CONFIDENCE INTERVAL TESTING BenchmarksRussel 2000 Growth Morningstar Small-Cap Core S&P % C.I.0.04± ± ±1.922 FundsAbbe SRIWinslow Green Growth Calvert Social Investment Equity Fund 95% C.I ± ± ±1.927

OUR RECOMMENDATION Calvert Social Investment Equity Fund

KEY POINTS Sustainable investments incorportate ESG performance with financial returns, without tradeoffs. Environmental and social leadership is compatible with profit. Calvert shows commitment to ESG and strong financial performance. High performing fund with low risk ensures financial stability and thus sustainability.

Thank you. Questions?