Sustainable, Responsible &/or ESG Policy:

Objectives and Investment Policy

The Share Class is a share class of a Fund which aims to achieve a return on your investment, through a combination of capital growth and income on the Fund’s assets, which reflect the return of the MSCI Japan SRI Select Reduced Fossil Fuel Index, the Fund’s benchmark index (Index).

The Share Class, via the Fund, is passively managed and aims to invest so far as possible and practicable in the equity securities (e.g. shares) that make up the Index.

The Index measures the performance of a sub-set of equity securities (e.g. shares) issued by Japanese companies within the MSCI Japan Index (Parent Index) with higher environmental, social and governance (ESG) ratings than other sector peers within the Parent Index, based on a series of exclusionary and ratings based criteria. 

Companies are excluded from the Index if they are identified as being involved in certain business lines/activities, as outlined in the Fund’s Prospectus. The remaining companies are rated by the index provider based on their ability to manage their ESG risks and opportunities and are given a MSCI ESG rating which determines their eligibility for inclusion. Companies that are involved in very severe controversies are also excluded based on an MSCI ESG controversy score.

The Fund will adopt a best-in-class approach to sustainable investing, this means that it is expected that the Fund will invest in the best issuers from an ESG / Socially Responsible Investment (“SRI”) perspective (based on the ESG or SRI criteria of the Index) within each relevant sector of activities covered by the Index.

The Index targets a 25% representation from each Global Industry Classification Standard (“GICS”) sector within the Parent Index. Eligible companies in each sector are ranked by the following criteria (in order): (1) each company’s MSCI ESG Rating, (2) current index membership (existing constituents are preferred over non constituents), (3) industry adjusted ESG scores, and (4) decreasing free float-adjusted market capitalisation. Eligible companies from each sector are then included in the Index in a specific order, as defined by the index provider in the index methodology, until the 25% representation has been met.

The Index is free float adjusted market capitalisation weighted. Free float-adjusted means that only shares readily available in the market rather than all of a company’s issued shares are used in calculating the Index. Constraints to limit deviation from the constituent and sector weights of the Index are applied. The Fund's investment in the equity securities that make up the Index will, at the time of purchase, comply with the ESG requirements of the Index. Where securities no longer meet such requirements, the Fund may continue to hold them until they cease to form part of the Index and it is practicable to sell them.

(Source: KIID, as at February 2025)

 

SDR Labelling:

Not eligible to use label