Sustainable, Responsible &/or ESG Policy:

Head of Global Sustainable Equities Hamish Chamberlayne, CFA, Andrew Jones, James Briggs, ACA, CFA, and Brad Smith are the co-portfolio managers of the Fund. The Fund consists of three sub-portfolios: global equities managed by Hamish, UK equities managed by Andrew, and a fixed income sub-portfolio managed by James and Brad.

The portfolio management team work closely with the broader Global Sustainable Equities Team and with the firm’s Responsible Investment and Governance Team, part of the central Responsibility Team.

The Responsible Investment and Governance Team focuses on ESG data analysis and research, governance, ESG company and thematic engagement, proxy voting and advisory services that serves as a resource for all our investment desks. The team delivers ESG training, support on developing frameworks to identify financial material ESG issues, planning and conducting engagements, supporting research on ESG issues that can impact cash flows or valuation, and advising on proxy voting.

Key differentiators

Diversified multi-asset portfolio with an attractive risk-return profile and clear exclusionary criteria
The Global Responsible Managed Fund provides clients with exposure to a blend of equities and bonds that is diversified in terms of geography, sectors, themes, and style. The Fund operates a three sub-portfolio approach covering global equities, UK equities and fixed income. This mix of assets gives the Fund the potential to outperform in a variety of market conditions and is an option for clients not wanting full exposure to equity market volatility.

Environmental & social avoidance criteria and ESG investment framework
Since inception, the Fund has applied strict avoidance criteria to avoid companies involved in business activities that may be environmentally and/or socially harmful. ESG considerations are integral to the investment philosophy and process, from universe definition and idea generation through to fundamental analysis, engagement, and portfolio management. For more information on the Fund’s most material and quantifiable ESG key performance indicators (KPIs) please refer to the Fund’s latest Annual ESG Report - Annual ESG, Sustainability and Climate Report.

Low carbon characteristics
As a result of the Fund’s responsible investment approach, the Fund’s carbon characteristics, such as carbon footprint and carbon intensity, will be lower than if this approach was not applied.

Diversified by style and theme
The global equity sub-portfolio provides investors with exposure to the global growth characteristics and positive investment themes of the Janus Henderson Global Sustainable Equity strategy (the “strategy’). The UK equity sub-portfolio provides exposure to the UK Responsible Income strategy with a focus on free cash flow generation, dividend yield and, dividend growth within a valuation framework. Finally, the fixed income sub-portfolio helps dampen the Fund’s volatility and offers exposure to themes such as social housing and infrastructure that are harder to access through public equity markets.

Long history of sustainable investing with a highly experienced investment team
Janus Henderson Investors (“Janus Henderson” or the “firm” or “JHI”) has a long and successful track record in the consistent application of a sustainability framework – the first sustainable strategy was launched in 1991 and Andrew and Hamish have been involved in the management of this Fund since 2012 and 2013 respectively. The Fund itself is over 20 years old with a strong track record of producing attractive risk adjusted returns for clients*.
*Past performance does not predict future returns.

The Fund consists of three investment sub-portfolios: global equities, UK equities, and fixed income.

The global equities sub-portfolio provides investors with exposure to the global growth characteristics and positive investment themes of the Janus Henderson Global Sustainable Equity strategy. The UK equities sub-portfolio meanwhile delivers an attractive dividend yield with a focus on free cash flow generation and valuation. Finally, exposure to fixed income helps dampen the Fund’s volatility. The result is a Fund that can outperform in a variety of market conditions and offers clients compelling risk-return characteristics, an attractive option for those not wanting full exposure to equity market volatility.

The investment approach of the Fund is primarily one of bottom-up security selection, operated within the ESG investment framework and avoidance criteria parameters of the Fund*.

* This strategy integrates ESG but does not pursue a sustainable investment strategy or have a sustainable investment objective or otherwise take ESG factors into account in a binding manner. ESG integration is the practice of incorporating material environmental, social and governance (ESG) information or insights in a non-binding manner alongside traditional measures into the investment decision process to improve long-term financial outcomes of portfolios. ESG related research is one of many factors considered within the investment process and in this material we seek to show why it is financially relevant.

Each of the sub-portfolios initially start with determining the investment universe where we seek to avoid businesses that have products or operations directly associated with the following exclusionary criteria:

Environmental and social avoidance criteria (1)

• Alcohol - We avoid companies involved in the production and sale of alcoholic drinks.
• Animal testing - We avoid companies that manufacture vitamins, cosmetics, soaps, or toiletries unless they make it clear that their products and ingredients are not animal tested. We allow animal testing for medical purposes only where the company employs best practices in accordance with the ‘3Rs’ policy of refinement, reduction, and replacement (2)
• Armaments - We avoid companies involved in the direct production or sale of weapons. We will not invest in companies involved in the direct production of land mines, cluster munitions, biological/chemical weapons, and nuclear weapons (3)
• Chemicals of concern -  We avoid companies which manufacture or sell chemicals, or products containing chemicals, subject to bans or severe restrictions in major markets around the world. This includes ozone-depleting substances micro beads, persistent organic pollutants, and the manufacture of any other substances banned or restricted under international conventions.
• Fossil fuel extraction & refining - We avoid companies engaged in the extraction and refining of coal, oil, and gas.
• Fossil fuel power generation - We avoid companies engaged in fossil fuel power generation; however, investment in companies generating power from natural gas may be allowed in cases where the company’s strategy involves a transition to renewable energy power generation (4). In the case of labelled bonds, we may consider bonds issued by companies engaged in fossil fuel power generation where there is no association with tar sands, oil shale, fracking, or a predominant reliance on thermal coal power generation, and where there is a credible plan for transition to net zero or renewable energy.
• Fur - We avoid companies involved in the sale or manufacture of animal fur products.
• Gambling -  We avoid companies with activities related to gambling.
• Genetic engineering - We avoid companies involved in the deliberate release of genetically modified organisms (eg, animals or plants). Investment in companies where genetic technologies are used for medical or industrial applications may be acceptable providing high environmental and social standards can be demonstrated. Companies that use or sell products that make use of such technologies may be acceptable providing genetically modified organism (GMO) ingredients that are clearly labelled.
• Nuclear power - We avoid companies that are involved in the uranium fuel cycle, treat radioactive waste, or supply specialist nuclear related equipment or services for constructing or running nuclear plant or facilities.
• Pornography - We avoid companies that are involved in producing or distributing pornography and adult entertainment materials or services.
• Tobacco - We avoid companies that engage in activities related to the production and sale of tobacco products.

Source: Janus Henson Investors.

(1) We also seek to avoid companies operating in contentious industries which have a high degree of negative environmental or social impact unless the company is taking action to mitigate negative impacts. Examples of contentious industries include cement, mining, and timber.
(2) 3 ’R’s: Refine experiments to ensure suffering is minimised. Reduce the number of animals to a minimum. Replace animals with alternative techniques.
(3) As a firm wide policy we exclude companies involved in controversial weapons.
(4) Transitioning companies are companies whose strategy involves a transitioning to renewables energy power generation and with a carbon intensity aligned with the scenario of restricting global warming to two degrees above pre-industrial levels. Where carbon intensity cannot be determined, there is a 10% threshold for energy production from natural gas.

In addition to the avoidance criteria, all holdings in the Fund are compliant with the UN Global Compact Principles and the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises (5). The UN Global Compact’s ten principles cover human rights, the International Labour Organisation’s declaration on workers’ rights, corruption, and environmental pollution, while the OECD guidelines cover a range of issues to including but not limited to employment, bribery, disclosure, and competition.

(5) The OECD Guidelines for Multinational Enterprises are recommendations addressed by governments to multinational enterprises operating in or from adhering countries. They provide non-binding principles and standards for responsible business conduct in a global context consistent with applicable laws and internationally recognised standards.

Government bond criteria

The Fund will only invest in G7 government debt.

De minimis limits
In order to minimise exposure to business activities and behaviours that may be environmentally and/or socially harmful, the Fund seeks to avoid businesses that have products or operations directly associated with the certain criteria, subject to de minimis limits.

Where possible, we will seek to achieve zero exposure in respect of the avoidance criteria. However, there may be instances when we will apply a de minimis limit. A de minimis limit is a threshold above which investment will not be made and relates to the scope of a company’s business activity; the limit may be quantitative (eg, expressed as a percentage of a company’s revenues) or may involve a more qualitative assessment. De minimis limits exist because sometimes avoiding an industry entirely may not be feasible given the complex nature of business operations.

In such instances, we will invest in a company only if we are satisfied that the ‘avoided’ activity forms a small part of the company’s business, and when our research shows that the company manages the activity in line with best practice.

When the activity relates to a company’s revenues, we use a 10% threshold, unless otherwise stated. When the activity relates to a company’s operations, we will seek to gain comfort that the company is taking action to improve its performance or is managing it in an exemplary fashion. Any company with a persistent record of misconduct will be excluded unless there is clear evidence of significant progress.

The Fund may invest in companies that would be excluded by the screens described above if the investment manager believes, based on its own research, and as approved by its ESG Oversight Committee, that the third-party data used to apply the exclusions is insufficient or inaccurate. Exclusionary screens are applied to direct investments (excluding government bonds) using third-party data at the point of investment and are monitored on a continuous basis. If an investment becomes ineligible based on exclusionary screens it will be divested within 90 days.

Janus Henderson has appointed specialist companies, MSCI and Vigeo EIRIS, to provide the environmental and social avoidance criteria screening of potential investments. An investee company must pass these screens or be approved by the ESG Oversight Committee to be eligible for the Fund.

ESG investment framework

Assessment of the risks and opportunities stemming from environmental, social, and governance (ESG) issues forms part of our investment due diligence. We believe that companies with effective management strategies to address material ESG issues are more likely to reliably generate shareholder value.

As part of our analysis, we identify and prioritise the issues we deem to be the most financially material to the investment case. These vary from company to company according to the sector and industry. We define materiality as the potential of an issue to significantly impact the short- or long-term financial performance of a company. We look at whether a company is willing or able to manage and mitigate its material ESG issues / factors, how it performs in its peer groups, its exposure to controversies and its approach to climate change. We also consider other issues that have the potential to effect impact stakeholder groups beyond the shareholder, such as society, the environment, and the world around it. Factors that may be considered include but are not limited to:

Identifying companies with good governance practices is fundamental to our investment process. We take factors such as the alignment of interests between shareholders and management, the strength of relations with stakeholders, and the management of environmental and social risks all as evidence of good governance practices.

At the Fund level, we monitor quantitative data on carbon emissions and climate scenario analysis. We also assess qualitative factors such as whether companies are measuring and reporting carbon emissions and whether they have set targets to manage these. As a result, and given the Fund’s exclusion of high emitting sectors, it is expected that the Fund’s carbon characteristics, as measured by third party provider MSCI, will be lower than if this approach was not applied.

We make use of both internal resources and external research and data providers. Internal resources comprise specialist sustainability analysts within various investment teams and Janus Henderson’s central Responsibility Team. Our principle external ESG data provider is MSCI, however, we also use several other ESG research providers including Sustainalytics, ISS, and Vigeo EIRIS.

As mentioned earlier, the Fund is actively managed with reference to the IA Mixed Investment 40–85% Shares sector average.

Process:

Investment approach

The three sub-portfolios have the following approaches:

Global equities
The global equities sub-portfolio is managed using the same investment approach as Janus Henderson's Global Sustainable Equity strategy which applies ‘positive selection criteria’. This investment approach seeks to invest in businesses that have products or services that contribute to positive environmental or social change and thereby have an impact on the development of a sustainable global economy, whilst avoiding companies that potentially have a negative impact on the development of a sustainable global economy. Examples of themes identified include efficiency, cleaner energy, water management, environmental services, sustainable transport, sustainable property & finance, safety, quality of life, knowledge & technology, and health.

Idea generation
Our approach to idea generation is based on a bottom-up search for high quality investment ideas. Every investment in the portfolio starts as an individual company idea which can be generated via a number of different teams and is then subject to our structured evaluation framework.

The four pillars of our sustainability-driven investment strategy
We see four key elements to an investment approach based on sustainability. Often there are conflicts between environmental and social sustainability, and our approach seeks to address this by using both positive and negative (avoidance) investment criteria and considering both the products and operations of a business. Company engagement and active portfolio management are essential features of any true sustainable investment strategy.

There are four pillars to our sustainable investment process which incorporates both positive and negative selection criteria and includes both product and operational impact analysis. It is through this rigorous and repeatable stock-selection process that we believe we add value to our clients.

• Thematic revenue alignment: ten sustainable development themes guide idea generation and identify long-term investment opportunities.
• Avoidance criteria: we will not invest in activities that contribute to environmental or social harm. This also helps us avoid industries most likely to be disrupted.
• ‘Triple bottom-line’ framework: fundamental research evaluates how companies focus on profits, people, and the planet in equal measure.
• Active management and engagement: we construct a differentiated portfolio with typically high active share (>85%). Collaborative, continuous, and collective engagement is a key aspect of our process.

Positive investment themes
The team believes that the defining investment issue of our time will be transitioning to a low carbon and sustainable economy, while maintaining the levels of productivity necessary to deliver the goods and services that an ageing and growing population requires. Derived from these four megatrends, we identify ten environmental and social sustainable development themes. Examples of these themes the investment manager has identified include clean energy, efficiency, environmental services, sustainable transport, water management, knowledge and technology, health, safety, safety, sustainable property and finance and quality of life. For a company to be eligible for the portfolio at least 50% of its revenues will be aligned with at least one of these sustainable development themes.

Fundamental and valuation analysis
The team have a rigorous process the fundamental research process which is looking at both ESG factors and also financial factors in an integrated fashion. The team ultimately analyses every company on the basis of the ‘3Ps’ of their ‘triple bottom line’ framework: how they generate Profits, how they impact People; and how they impact the Planet.

The team seeks to identify businesses with long-term compounding characteristics, and with optionality upside, which are trading at discounts to their intrinsic value. Typically, the team looks for companies with the ability to generate and compound long-term free cash flows, where the equity market is currently under-valuing those. There is a specific focus to the financial analysis that the team does to identify intrinsic value.

The team looks for:

• The potential for multi-year revenue compounding
• A culture of innovation, that in turn drives that upside optionality
• Durable business models
• Greater predictability of revenues
• Consistency of margins and cash flows
• Strong balance sheets

Active portfolio construction and risk management
Every stock selected for the portfolio must fit at least one theme; but for the purposes of portfolio construction, there is no forced distribution of themes. Portfolio construction is driven by stock selection, with each stock assessed within the disciplined analytical framework. The portfolio is constructed with the aim of generating attractive excess returns, but with a good level of overall risk diversification. The intention is to construct a high-conviction portfolio with high active share against the benchmark.

UK equities
The UK equities sub-portfolio is managed using the same investment approach as Janus Henderson's UK Responsible Income strategy. The strategy is actively managed with reference to the FTSE All Share Index, which is broadly representative of the companies in which it may invest. It seeks to identify UK companies, with attractive long-term business models offering the potential for good dividend growth and capital returns over the long term.

Idea generation
The strategy takes a bottom-up stock selection investment approach. The fundamental positions of companies are examined, and an evaluation made of whether they are well placed to generate good cash flow to ensure that dividends may be sustained and increased over time.

The strategy typically outperforms when markets are driven by a focus on valuation and the strength of underlying businesses in terms of their ability to pay a dividend, grow the dividend, maintain a robust balance sheet, and generate good levels of cashflow.

Once the avoidance criteria have been applied, fundamental analysis is then carried out on securities. The portfolio manager aims to understand what will drive a company’s earnings and profitability over the long term, and then assesses how the market currently values the company relative to its potential. As part of this fundamental analysis the portfolio manager will consider the effect of material ESG issues on the long-term attractiveness of companies.

Fundamental analysis
There are four key sections the portfolio manager focuses on:

• Defensible competitive position
• Aligned management behaviour
• Affordable investment requirements
• Sustainable returns

Valuation analysis
The bottom-up stock selection process is grounded in fundamental analysis that aims to gain a clear understanding of specific companies and their markets, together with a valuation discipline that encompasses a wide range of valuation techniques. Rather than applying a prescribed valuation metric, the portfolio manager uses relative and absolute valuation measures that are relevant to each company’s business and the industry or sector in which they operate.

As well as dividend yield, other factors such as dividend growth, free cash flow yield, cash flow growth, balance sheet strength, and profitability-based metrics such as price/earnings ratios are also considered. The portfolio manager will also consider metrics such as Net Asset Value, EV/Sales, and EV/EBITDA. There is a strong emphasis on identifying companies that have good and growing levels of free cash flow with the aim of identifying stocks with the potential for income growth and capital returns. Robust balance sheets are also favoured within the process.

While fundamental analysis may suggest a company has good prospects, the valuation discipline focuses on assessing whether a company is attractively priced. This valuation-driven approach favours temporarily unpopular stocks, resulting in a moderately contrarian portfolio.

ESG investment framework

Analysing ESG issues is an important part of the analysis of a company’s business fundamentals. Environmental factors consider a company’s impact on the environment, social factors consider the way businesses treat and value people, and governance factors focus on corporate policies and how companies are governed. We believe companies with sound governance practices and strong stakeholder relations, that manage relevant environmental and social risks responsibly, have a greater propensity to create long-term value for shareholders. Key ESG issues considered as part of the investment process include corporate governance, human capital and diversity, climate change, controversies, disclosure, transparency, and business ethics.

Active portfolio construction and risk management

The portfolio is constructed on a conviction-weighted basis whereby the weights of individual stocks are driven by company-specific analysis and the income objectives of the strategy without regard to the weightings in the performance benchmark. The liquidity of a stock will be considered when determining position size.

In constructing the portfolio, the portfolio manager is able to draw on the resources of the Janus Henderson Investment Risk Team to assess the likely impact of portfolio reorganisations in terms of risk and return, and to ensure that individual positions reflect the portfolio manager’s level of conviction in each company. The portfolio has held between 60 to 75 securities historically. The typical investment horizon would be 3 to 5 years.

Fixed income ESG integration

Our approach to ESG integration seeks to maximise our analytical strengths. At its heart is a forward-looking approach as our primary consideration is to identify value and avoid unwanted risk. ESG factors can have a material impact on credit outcomes, which is why we believe they are an important consideration within our decision-making. We place importance on an issuer’s willingness to improve and seek to corroborate what companies say with evidence of action. Outside of certain areas (eg, cluster munitions) we typically avoid blanket exclusions unless requested within bespoke ESG-segregated mandates. The investment team can share and access issuer-level and portfolio-level ESG information through our proprietary ESG data and analytics tool ESG Explore (ESGX). Many of the climate metrics include those identified as best-practice by the Task Force on Climate Related Financial Disclosures and the Partnership for Carbon Accounting.

Rating model

Fixed Income ESG rating spectrum

Our ratings model is a four-step process. Each step is important as we combine third-party ESG data with our own research and analysis. The forward-looking assessment provides a qualitative overlay to the earlier quantitative metrics to arrive at a final ESG rating for a corporate issuer.

Sector assessment: top-down view of material ESG issues at sector level
Company baseline score: bottom-up, data-drive and leveraging third-party data
Forward-looking assessment: subjective analyst views from timely and dynamic ratings
JHI ESG rating: final proprietary sector-agnostic rating

Incorporation within overall credit recommendation
Our proprietary ESG ratings are reflected in our data analytics tool Quantum, which is utilised by our investment teams as well as in ESG Explore, our in-house ESG research database.

The ESG rating allows for sufficient differentiation to be meaningful when integrating financially-material ESG into our decision-making. For example, for a security with a high ESG risk (marked as Red), we expect a greater risk premium to be incorporated into the overall relative value assessment. Analysts leverage insights from ESG Explore (see over) and their engagements (see over) to refine the ESG ratings, which then influence the broader credit recommendations. The overall credit recommendations are formulated by considering industry insights, fundamental analysis (e.g. balance sheet strategy, cash flow generation, management analysis), market dynamics, valuations, ESG and quantitative analysis to develop trade ideas. These trade ideas are then shared with the portfolio managers who determine the overall allocation of the portfolio.

Fixed income engagement
Stewardship and a commitment to good governance is an integral part of Janus Henderson’s active approach to investment management. The primary route for engagement is the regular meetings analysts and portfolio managers have with the issuers in which they invest, of which we hold thousands each year. Meetings can incorporate a wide range of topics, including strategy, capital allocation, performance, risk, management succession, board composition, corporate governance and environmental and social issues. We classify engagements as either:

• Engagement for insight. The goal is to understand an issuer’s ESG strategy and actions and incorporate this into our decision-making.
• Engagement for action. These are outcome-oriented, where we encourage issuers to take decisions that we believe are in the best long-term interests of bondholders.

Thematic engagements are chosen based on their relevance and potential to enhance understanding of financially material ESG factors within sectors. Top-down themes reflect client interests and key market and societal ESG trends, such as decarbonisation, water scarcity, decent work (diversity, equity and inclusion) and business ethics. This is typically cross-collaborative with equity colleagues and aligned with the Responsible Investment and Governance (RI&G) Team. Credit analysts additionally based on bottom-up considerations, triggered by their ongoing credit analysis.

ESG Explore (ESGX) / investment team ESG data
ESGX allows our investment teams to access issuer-level and portfolio-level ESG information. Many of the climate metrics include those identified as best-practice by the Task Force on Climate Related Financial Disclosures and the Partnership for Carbon Accounting.

Collaboration with the central Responsibility Team
The integrated ESG approach to our investment decisions is further enhanced by collaboration with the central Responsibility Team, which comprises four pillars:

Credit analysts in our Global Credit Research Team partner with RI&G analysts to work on joint engagement and leverage their ESG research. This can help generate ideas, increase transparency around ESG risks and challenge portfolio positioning.

We recognise that ESG is evolving, which is why regular ESG forums and the ESG Research Working Group continuously work to review and strengthen our processes, ensuring we adopt best practices and successfully integrate financially- material ESG factors into our decision-making process.

Asset allocation
The Fund’s alpha generation is primarily generated by bottom-up stock and bond selection from the three underlying sub-portfolios. However, the asset allocation between equities and fixed income is also reviewed at regular asset allocation (AA) meetings with the Fund’s asset class exposure monitored relative to the IA mixed investment 40 to 85% shares sector peer group average. The purpose of the AA meeting is to ensure there is appropriate risk exposure across the Fund’s asset classes, while also identifying any areas that are over or under valued with the aim of ensuring capital is appropriately allocated. These meetings are attended by the portfolio managers and chaired by Jane Shoemake, the Client Portfolio Manager for the Fund.

The Fund’s asset allocation is based on an assessment of the bottom-up opportunity set in each asset class alongside top-down macroeconomic analysis. The team utilise third-party macro research in addition to the asset allocation expertise of the London-based Multi-Asset Team and the Denver-based Balanced Team. These inputs all help inform the asset allocation discussion and determine the relative value of bonds in comparison to equities.

The team consider several top-down macro-economic leading indicators alongside bond market signals, including the shape of the yield curve, interest rate expectations, central bank monetary policy and any recent significant changes. Asset class valuations (both absolute and relative) are also considered with relative yield seen as a useful valuation indicator.

The extent of bottom-up investment opportunities identified by the respective portfolio managers also feeds into the asset allocation decision making process. For the allocation between UK and international equities, Hamish and Andrew consider both bottom-up and top-down factors, including a range of relative valuation metrics, earnings and dividend growth forecasts, macro-economic data, and investment opportunities at the stock level.

Asset allocation decisions are not limited to being made at the scheduled bi-monthly asset allocation meetings but can also be acted upon more frequently as market opportunities arise. Ultimate decision-making authority resides with the four Fund managers and no AA change will be made unless there is complete agreement.

The portfolio managers ensure there is appropriate risk exposure across the Fund’s asset classes, while also identifying any areas that are over or under valued with the aim of ensuring capital is appropriately allocated.

Asset allocation constraints
Beyond the IA sector criteria, there are no minimum or maximum asset class weight constraints although the Fund will typically not have more than 10% of its AUM in cash. Additionally, the Fund will typically not exceed +/- 10% weighting vs the peer group benchmark in either the global, UK or fixed income sub-portfolios. The portfolio will also generally be at least 60% invested in equities unless a material change in the risk/reward of equities versus fixed income securities is identified which may prompt a temporary increase in the fixed income allocation.

Within the fixed income sub-portfolio, the allocation between government bonds and corporate bonds, and investment grade and high yield, is driven by the output from the monthly credit team meetings and their risk budgeting process which ultimately decides the beta and duration management for the sub-portfolio. The duration of the fixed income sub-portfolio will usually be within +/-2.5 years of the fixed income comparator benchmark (50% Bloomberg Barclays Global Aggregate Corporate Unhedged £ and 50% Bloomberg Barclays Sterling Aggregate Unhedged £).

Cash

The IA mixed investment 40 to 85% shares sector includes a weighting to cash and the Fund’s allocation to cash is considered as part of the asset allocation discussion.

Derivatives

The portfolio managers may use derivatives to reduce risk or to manage the Fund more efficiently.

Sell discipline

Equity holdings may be sold for several reasons:

• Impairment of the long-term investment thesis – if there is a change, either at the regulatory, industry or company level, which undermines the ability of the company to grow over time.
• Breach of avoidance criteria – if the company, either as a result of an acquisition or internal business development, becomes involved in an activity that transgresses the avoidance criteria.
• Deteriorating or unresolved operational ESG issues – the team seek to invest in companies which demonstrate high and improving standards in respect of the management of operational ESG factors because this underpins the ability of the company to grow over time.
• A new idea offers a more compelling risk/reward opportunity.

Fixed income holdings may be sold for the following reasons:

• Change in the portfolio manager’s / credit analyst’s view on a security.
• Performance - relative to sector / peers.
• Threshold loss tolerance level (bps) exceeded - at either the security or Fund/strategy level
• Breach of avoidance criteria

Engagement

Company engagement forms an important part of the investment process. The team take an active approach to communicating their views to companies and seeking improvements in performance. The types of engagement include:

• Collaborative engagement: coming together with a group of other institutional investors to engage with companies on a range of ESG issues.
• Continuous engagement: working with companies on ESG issues that have long-duration and do not result in immediate outcomes.
• Collective engagement: bringing together ideas and resources from a diverse range of stakeholders from outside the organisation to engage with companies on key issues.

Our analysis of the portfolio against key ESG performance indicators helps us identify topics for engagement, together with the controversies, scientific advances and actions taken by companies. These topics for engagement are not fixed and are subject to change depending on the activities of the company and their materiality.

Janus Henderson’s Proxy Voting Policy and Procedures document, which can be found on www.janushenderson.com, sets out the firm’s proxy voting policy.

Ultimate voting authority rests with the portfolio manager of each sub-portfolio, who is responsible for ensuring that votes are exercised in the best interests of clients, with ESG factors an important consideration where relevant. The portfolio managers are supported by the central Responsible Investment and Governance team, who work closely with investment teams to help analyse voting-related issues. With regards to voting and company engagement, the portfolio manager considers certain core principles such as disclosure, transparency, board composition, shareholder rights, audit and internal controls, and remuneration. A key element of the approach to proxy voting is to support these principles and practices and foster the long-term interests of shareholders.

Given the Fund’s responsible investment process incorporates environment, social, and governance factors in investment decisions, there will be relatively few shareholder proposals on ESG issues for the companies held in the Fund. We aim to support shareholder proposals on ESG factors for portfolio holdings following our approach to voting and engagement outlined within this document.

The Fund’s Quarterly Voting and Engagement Report can be found on www.janushenderson.com.

ESG risk management
ESG monitoring is fully integrated into Janus Henderson’s risk reporting and review processes for the Fund.
Regular MSCI ESG reports are available to portfolio managers. These reports identify the companies with the highest risk ratings with respect to overall ESG issues, significant changes in ESG ratings, controversy risk, governance risks and the portfolio’s carbon footprint relative to the relevant benchmark. These reports also provide an ESG quality score which measures the ability of the underlying holdings to manage key medium to long term risks and opportunities that arise from ESG factors. These ratings are supplemented with Janus Henderson research and analysis as well as engagements with companies when appropriate.

These reports are discussed at ESG meetings with the Responsible Investment and Governance team where the focus is on identifying areas for further engagement both at a theme and company specific level.

The portfolio is subject to regular reviews of its exposure to ESG risks as part of Janus Henderson’s formal risk oversight process. The team use numerous ESG data systems including Sustainalytics, MSCI, ISS, Bloomberg, RepRisk to flag exposure to controversies.

Risk management
Portfolios are subject to independent reviews on an on-going basis, with regular management and internal monitoring controls implemented at various levels:

• Compliance with investment/trading restrictions are monitored by the compliance system, Charles River Development (CRD).
• Portfolio risk is independently monitored by the Investment Risk Team, who aim to meet every portfolio manager at least once a quarter on a rolling basis.
• Portfolio performance and consistency is peer reviewed by senior personnel, including the Global Co-Heads of Equities. Performance and risk statistics are formally reviewed by the Board monthly.

For further details, please refer to the link – Janus Henderson Global Responsible Managed Fund_Investment Principles.

Resources, Affiliations & Corporate Strategies:

As at 31 March 2025, Janus Henderson has 32 Responsibility Team resources. This centralised team are our ESG subject-matter experts who partner with our investment teams on ESG. On our investment teams, we have 12 dedicated ESG experts embedded within numerous investment teams. Additionally, we have 18 portfolio managers* on Janus Henderson’s Brighter Future (ESG-focused) Funds. Our portfolio managers are further supported by our central research functions and/or investment team analysts.

Source: Janus Henderson Investors, as at 31 March 2025.

*Portfolio managers manage multiple strategies, so may not be fully dedicated to ESG-focused products. Note: the methodology to calculate this data has changed and previously included portfolio managers who manage ESG-integrated funds rather than ESG-labelled products.

Our approach to Responsibility

Janus Henderson has a three-pronged approach to Responsibility.

• The first is our own corporate responsibility. Our commitment to responsibility extends to our corporate practices, embodying the principle that ‘Responsibility starts at home.’ We need to ensure our own policies and practices reflect what our stakeholders demand. At a corporate level, behaving responsibly impacts our people, our culture, and our choices with the ultimate aim of investing in a brighter future for our clients. We leverage our influence to responsibly deliver value to our clients, employees, shareholders, and the wider community.

• The second is ESG integration. At an investment level, we integrate financially material ESG factors into our analysis and processes for most of our actively managed strategies, as appropriate, to help us identify opportunities and risks and to drive the long-term value of the companies in which we invest.

• The third is our JHI Brighter Future Funds. For those clients who want to invest for a purpose beyond risk and return, we have and continue to build our suite of ESG-focused strategies that go above and beyond integration to have ESG considerations at their core alongside the primary financial objective.

Responsible Investment Policy overview and Integration

Janus Henderson’s has had a Responsible Investment Policy since approximately 2001, referring to the legal Henderson policy established at this time. In 2023, we implemented our revised Responsible Investment Policy, which sets out our approach to Responsible Investing and ESG Governance and Oversight.

As an active manager, integrating financially material ESG factors into our investment decision-making and ownership practices is fundamental to delivering the results our clients seek from us. Financially material ESG considerations are a key component of the investment processes employed by our investment teams for most of our actively managed strategies. Our investment teams operate and are structured in ways most suited to their respective asset classes. Aside from expectations outlined within our Responsible Investment Policy, the precise approach to and depth of ESG integration is down to the discretion and judgement of our investment teams, who apply their differentiated perspectives, insight and experience to identify sustainable business practices that can generate long-term value for investors. While the evaluation of our implementation of ESG criteria is carried out at the strategy level, our central Responsibility Team supports each team in their ESG integration with data, tools, stewardship, and ESG research.

Engagement and stewardship approach

Engagement and stewardship are integral and natural parts of our long-term, active approach to investment management. We believe engagement is vital to understanding and promoting practices that position the companies and issuers we invest in for future financial success.

Our investment teams often partner with our central Responsibility Team on engagements with company management teams. We prefer an engagement-focused approach to a firm-level exclusion or divestment policy for companies and issuers where we have identified financially material ESG risks. We believe this approach is best for maximising risk-adjusted returns for our clients.

We have a wide range of engagement themes and topics chosen by individual investment teams or the Responsible Investment and Governance Team, which is part of the broader Responsibility Team. These range from longstanding engagement themes such as climate change and diversity, equity & inclusion, to biodiversity, human capital and culture, health and wellbeing, and sustainable corporate governance.

Most products and services offered by a company or issuer play necessary roles for the global economy – including sectors with higher carbon emissions such as energy, industrials, materials, and utilities. Rather than ignoring companies or issuers in these sectors through automatic exclusion or divestment, engagement leads to two benefits:

• Insight: Knowledge gained through engagements with companies or issuers can be leveraged in the investment process to better inform our research, financial modeling, and investment decisions. Engaging for insight helps us assess the magnitude of any potential risk, how well a company or issuer is managing that risk, and the potential impact on that company or issuer’s financial outcomes.
• Outcomes: Where a company or issuer may be ignoring or not managing a financially material ESG risk, engaging for outcomes can encourage that company or issuer to adopt policies or practices that will address that risk and better position it for the future.

Engagement with the company or issuer’s management or board of directors directly link the ESG consideration to why we believe addressing it makes them a better company, leading to improved cash flows, valuations, cost of capital, or credit ratings. In 2024, we conducted a total of 716 engagement discussions – 666 for insight and 50 for outcomes.

Stewardship is an integral and natural part of Janus Henderson’s long-term, active approach to investment management. We believe that strong ownership practices such as management engagement can help protect and enhance long-term shareholder value.

We support a number of stewardship codes, such as the UK Stewardship Code, and broader initiatives around the world including the UN-supported Principles for Responsible Investment (PRI). We are pleased that the PRI has recognised the significant progress we’ve made in advancing our responsible investment capabilities over the last three years and maintained our high scores in our latest assessment through June 2024. We also continue to remain a signatory to the Financial Reporting Council’s UK Stewardship Code, regarded as a benchmark in investment stewardship.

Our commitment to clients

Janus Henderson understands responsible investing continues to evolve and mature. We are committed to maintaining an open dialogue with our clients, shareholders, employees, industry groups, and regional regulators to ensure we continue to meet their expectations and hold true to our values as a steward of our clients’ capital. This includes listening to client needs and developing new products to meet changing requirements. It also means actively sharing the views of our managers on how they see financially material ESG issues reshaping the investment landscape and where the risks and opportunities lie. The Janus Henderson website provides access to manager insights as well as our Responsibility policies, voting records and annual reports.

Janus Henderson Investors Brighter Future Funds

Many of Janus Henderson’s clients want to invest for a purpose beyond risk and return and, to meet the needs of these clients, we’ve developed our JHI Brighter Future Funds, a suite of ESG-focused portfolios that go above and beyond integration to have ESG at their core alongside the primary financial objective.

ESG-focused portfolios
Across the industry, there are many different approaches to managing ESG-focused portfolios. We consider the following strategies:

ESG leaders
Invest in companies that excel in managing ESG risks or taking advantage of financially material ESG opportunities.

ESG improvers and transitioners
Invest in companies that are actively enacting positive change in their own operations to address financially material ESG issues.

ESG solutions or enablers
Invest in companies that offer products and services that are essential to addressing financially material ESG issues.

Firm-wide exclusions policy

Except as noted below, the firmwide exclusions generally apply to all Janus Henderson Funds and discretionary segregated mandates. They do not apply to index and certain other derivatives or passive portfolios (including ETFs) intended to track a benchmark.

Issuers excluded
A direct manufacturer of and / or minority shareholding of 20% or greater in a manufacturer of:

• Cluster munitions
• Anti-personnel mines
• Chemical weapons
• Biological weapons

Classification of issuers is primarily based on activity identification fields supplied by our third-party ESG data providers. This classification maybe subject to an investment research override, following approval by the ESG Oversight Committee (ESGOC), in cases where sufficient evidence exists that the third-party field is not accurate or appropriate.

In any scenario where a portfolio position is identified as not meeting this exclusion criteria for any reason (legacy holding, transition holding, etc.) the portfolio manager shall generally be granted 90 days to review or challenge classification of the issuer if appropriate. After this period, in the event an investment research override is not granted, divestment is required under normal market trading circumstances.

Cannabis related issuers
To ensure Janus Henderson complies with regional legal and regulatory obligations ‘Cannabis-Related Issuers’ (CRI) may be excluded where an issuer’s revenue from cannabis related activities is understood to constitute more than 5% of their total revenue. A permissibility assessment is undertaken that gives consideration to various factors, including, without limitation:

• Domicile of Janus Henderson Fund;
• Domicile of Janus Henderson Fund Manager, including any sub-delegations;
• Domicile of the CRI; and
• Type of cannabis business operation, product, or activity conducted by the CRI.

Exceptions investing in CRI more broadly may be permitted following request to, and approval from, the ESGOC. All exceptions to this Policy requirement must be suitably documented with the accompanying rational.

Responsibility Team

The central Responsibility Team (the “team”) is a specialised in-house group focused on ESG data analysis and research, governance, ESG company and thematic engagement, and proxy voting and advisory services that serves as a resource for all our investment desks. They play a leading role in working with investment desks to enhance their ESG integration processes and externally leading our active participation in numerous responsibility initiatives. Fundamental, bottom-up research has been at the core of our investment process for more than 45 years and this partnership leads to enhanced research and decision-making by marrying the sector and industry expertise of the investment teams with the responsibility skills of the Responsibility Team.

In December 2022, we appointed Michelle Dunstan, an experienced leader in Responsibility strategy and responsible investing, as Chief Responsibility Officer (CRO) to oversee our Responsibility strategy. To emphasise the importance of our responsibility efforts and embed them across our entire firm, the CRO reports directly to the CEO, provides quarterly reports to our Board of Directors on established metrics and targets, and sits on the firm’s Strategic Leadership Team.

In 2024, we continued to add specialist resources to our central Responsibility Team to better align resourcing with our strategic priorities. As of year-end 2024 the Responsibility Team has 28 dedicated team members working as responsibility subject matter experts partnering with investment teams and firmwide colleagues. The team sits on the investment floor and is easily accessible to investment professionals. The Responsibility Team is centred around four focus areas:

Our Responsibility Strategy and Operations pillar supports our investment and non-investment teams in four areas -ESG Data and Analytics, Content and Learning (including the development of training, reports, client responses, external communications, and ESG thought leadership), Regulations and Risk (collaborating with Regulatory, Risk, Compliance, and Legal on relevant regulatory requirements / disclosures), and Corporate Sustainability (development and support of our corporate environmental strategy and execution).

Our Responsible Investment and Governance pillar provides direct support to our investment teams. The focus of this partnership is on equipping and supporting our analysts and portfolio managers to do what they do best: research industries and securities to select the most attractive candidates for inclusion in our portfolios. Our team will partner with the investment teams to deliver ESG training, support on developing frameworks to identify financial material ESG risks and considerations, planning and conducting engagements, supporting research on issues that can impact cash flows or valuation, and advising on proxy voting.

Our Responsibility Client Solutions pillar focuses on partnering with our product, distribution, and investment teams to enhance existing portfolios and deliver new portfolios to clients across varying levels of responsibility needs, from robust integration to ESG-focused strategies. They also partner with investment desks to continuously evolve our integration capabilities, including developing and refining integration frameworks that inform research, stewardship, and portfolio construction. Furthermore, the team also contributes to thought leadership content and conducts training on various responsibility topics.

Our Diversity and Community Relations pillar focuses on our core value of “Diversity Improves Results” and community relations. They are committed to creating an inclusive environment that promotes true meritocracy, cultural awareness, and respect.

To support our core value of “Diversity Improves Results” and community relations, we have a DEI Committee that is comprised of representatives from the Executive Committee and Senior Management. The Committee sets the firm overall DEI strategy, monitors progress and allocates budgetary resources. We also have a dedicated regional council. The councils are responsible for implementing our strategy at the regional level. Our Employee Resource Groups (ERGs) lead on championing grass-roots efforts led by employees and support our overall diversity, equity and inclusion goals. Our ERGs offer colleagues with common interests an opportunity to meet on a regular basis and discuss how they can make Janus Henderson a more inclusive workplace for all.

We leverage our ERGs to ensure that policies and communication are inclusive by allowing them an opportunity to review communication and messaging as needed and help design the curriculum to ensure it was relevant for our employees. Our ERGs also support with celebrating important events such as International Women’s Day, PRIDE, Remembrance Day, Black History Month, and more.

Goals for Responsibility Team and Chief Responsibility Officer

The role and goals of the Responsibility Team and Chief Responsibility Officer oversee the areas of our three-pronged approach to ESG.

• The first is our own corporate responsibility. We engage with our investee companies and encourage them to adhere to high corporate responsibility standards as a key driver of financial performance. Consequently, we believe our own standards should mirror those expectations.

• The second is ESG integration. We believe integrating financially material ESG factors is instrumental to fulfilling our fiduciary duty to our clients. Global environmental challenges such as climate change, biodiversity loss and pollution, and societal issues such as wealth and income inequality, access to education and healthcare, and cyberwarfare represent substantial long-term material risks to investor portfolios. We believe integrating these financially material ESG considerations into our investment decisions and stewardship processes allows us to better manage these risks to achieve the best outcomes for our clients.
  We also believe that ESG integration must be robust and incorporated into each appropriate stage of the investment management process, including idea generation, research and forecasting, engagement, investment decisions, and stewardship. We leverage our deep history with fundamental research to approach integration in a thoughtful, practical, research-driven, and forward-looking manner.
  For engagement, we engage for both insight – to understand company strategies and actions and leverage that information in our investment process, and we engage for action (outcome-oriented engagements), to encourage companies to take decisions that are in the best interest of long-term sustainable cash flows.

• The third is our JHI Brighter Future Funds. For clients who want to invest for a purpose beyond risk and return, we continue to build our suite of ESG-focused strategies and initiatives that go above and beyond integration to have ESG at their core alongside the primary financial objective.
  To accomplish this, the Responsibility team and Chief Responsibility Officer have five goals, as agreed upon by the Janus Henderson Group Board of Directors:
  • Enhance ESG insight and integration within investment teams
  • Offer clients a comprehensive, customized Responsibility experience
  • Systematize Responsibility data for enhanced insights and reporting
  • Adopt and embed a long-term strategic approach to addressing ESG Regulations
  • Extend strategic focus of Corporate Responsibility initiatives

The team’s four business lines are set up to accomplish these goals:

• Our Responsible Investment and Governance pillar provides direct support to our investment teams. The focus of this partnership is on equipping and supporting our analysts and portfolio managers to do what they do best: research industries and securities to select the most attractive candidates for inclusion in our portfolios. Our team will partner with the investment teams to deliver ESG training, support on developing frameworks to identify financial material ESG issues, planning and conducting engagements, supporting research on ESG issues that can impact cash flows or valuation, and advising on proxy voting.
• Our ESG Strategy and Operations pillar supports our non-investment teams in four areas - Strategic Initiatives (including responsible investing strategy, policy, and partnerships), ESG Data and Analytics, Content and Learning (including the development of training, reports, client responses, external communications, and ESG thought leadership), and Regulatory/Operations (collaborating with Regulatory, Risk, Compliance, and Legal)
• Our Client Solutions pillar focuses on partnering with our product, distribution, and investment teams to enhance existing portfolios and deliver new portfolios to clients across varying levels of ESG needs, from robust integration to ESG-focused strategies.
• Our Diversity & Community Relations pillar is committed to fostering inclusion, promoting cultural awareness, and establishing equitable policies, benefits, and training that support our people, and our DEI goals, and community outreach and relations.

Our Chief Responsibility Officer (CRO) provides quarterly updates to the Governance and Nominations Committee on progress against a range of tangible metrics. These metrics include:

• Upholding strong corporate practices: Maintaining strong ESG scores; setting and achieving governance goals.
• People, Community, and Environment: Setting and achieving people goals (including diversity, equity, and inclusion targets); setting and achieving corporate environment goals (including Scope 1, 2, and 3 emissions targets).
• Enhancing ESG reporting and messaging: Credibly assessing and effectively managing risks of current and future ESG regulations and reporting requirements; developing credible and consistent firm-level ESG messaging.
• Building our brand for thoughtful responsible investing: Developing ESG thought leadership; improving external ratings (from PRI and other bodies) for our responsible investing practices.
• Enhancing ESG integration and development of new ESG strategies: Increasing prevalence and quality of ESG integration; increasing number of (and assets in) ESG-focused strategies.

Additionally, the CRO first presented a dashboard of ESG and climate metrics to the Janus Henderson Board at our July 2023 Board meeting (data pertained to 30 June 2023). The CRO has presented the same dashboard for each quarter since then.

Responsible Investment Policy Oversight and Governance

Board of Directors

While our Board of Directors has received updates on sustainability, climate and ESG issues in the past, oversight of Responsibility and Responsible Investing, including climate considerations, were formally put under the remit of the Governance and Nominations Committee of the Janus Henderson Group Board of Directors in 2023. The Governance and Nominations Committee has established tangible ESG and climate metrics and targets for both our operational and investment activities, Our Chief Responsibility Officer presents a quarterly update to the Governance and Nominations Committee on the metrics, progress against targets, and advancements on strategic Responsibility initiatives. In addition, the Chief Responsibility Officer conducts a Director education session for the Governance and Nominations Committee each quarter; this is a “deep dive” into an important ESG topic—which could include our own corporate responsibility practices or our responsible investing practices.

ESG Oversight Committee

Our ESG Oversight Committee (ESGOC), which reports to Janus Henderson’s ExCo, provides direct oversight of ESG investment-related matters. The ESGOC provides oversight over ESG investment processes including credibility and feasibility of ESG-related commitments in portfolio design, portfolio management, various ESG data and toolsets, as well as non-investments oversight over ESG processes including regulatory and client reporting standards, and ESG disclosure. The ESGOC is responsible for ensuring that the firm’s framework to manage ESG-related risks is adequate and effective. Specific duties include:

• Review of ESG-related metrics and commitments for new funds and mandates and changes to ESG-related commitments to existing mandates
• Review of ESG-related processes, systems, and resources in place for funds and mandates
• Review of output from ongoing ESG oversight controls monitoring of key ESG-related metrics and exceptions, as well as escalations of matters identified during the course of the monitoring, if any.

The ESGOC is chaired by our Chief Responsibility Officer with additional membership from Responsibility, Product, Investment Controls & Governance, Compliance, Financial Risk, and Legal.

Internal Audit

Janus Henderson has an independent internal audit function, which reports to the Janus Henderson Group Audit Committee. It is responsible for the internal audit of the firm’s worldwide activities. Internal audit operates a multi-year, risk-based audit plan that covers all aspects of the firm’s investment and stewardship activities, such as proxy voting. Internal Audit embeds ESG considerations in all relevant audits within its cyclical risk-based plan. In addition, Internal Audit includes thematic reviews, which in 2024 included a review of the ESG control framework with a focus on regulatory compliance. The findings of these internal audits are regularly shared with the Janus Henderson Group Audit Committee as well as other relevant boards.

Risk management functions

Our Operational Risk function provides support and oversight to each business function to ensure all operational risks are managed in accordance with the risk appetite statement of the firm. Climate risks associated with each operational risk are identified and analysed as qualitative scenarios. Corporate physical and transition risks are reviewed at least annually and reported in a formal corporate Climate Risk Report to the Janus Henderson Group Risk Committee (including escalations of matters identified during the period, if any).

Our Financial Risk team is an independent function reporting directly to the Chief Risk Officer. Its activities include market risk oversight, liquidity risk monitoring and counterparty credit risk management. Further, the team reviews and challenges investment management in light of ESG-related risks— including climate risks—alongside traditional market risk metrics and embeds sustainability risk into the risk profiles of our funds, as appropriate. Beginning in 2023, the Financial Risk team further supports the investment desks in providing portfolio-level oversight of sustainability, climate, and ESG risks. Risk oversight meetings are held with investment desks regularly, with an agenda item to ensure climate-related portfolio risks have been identified.

Compliance

The Compliance team implements automated investment restriction controls within Janus Henderson’s order management system for ESG-related screening and supplements this approach with further controls for qualitative commitments. Additionally, the Compliance team reviews regulatory adherence to the investment policy via the execution of a risk-based monitoring plan. The Compliance team provides board and committee reporting on ESG regulatory matters and are members of the ESGOC.

Front Office Controls

The Front Office Controls & Governance team provide ongoing assurance that investment products are managed in line with documented sustainability commitments, where automated controls and/or third-party data are not available.

ESG Ratings and Recognition

We believe there is a strong link between sustainability issues and the companies that will grow and succeed going forward. This applies to us as an organisation, as well as the companies our investment teams actively engage with in their pursuit of long-term risk-adjusted returns for our clients.

Janus Henderson has been certified as a carbon neutral entity since 2007 by offsetting our corporate greenhouse gas emissions in accordance with The CarbonNeutral® certification. We continue to be certified as a CarbonNeutral® entity in 2024, including for emissions across our corporate Scope 1, 2 and a subset of upstream Scope 3, including business travel, waste, and homeworking. We have been an investor signatory of the Carbon Disclosure Project since 2000 and we are a registered supporter of the Task Force on Climate-related Financial Disclosures (TCFD) with our first report published in 2023. In 2024 we maintained high scores in our Principles for Responsible Investment (PRI) reporting covering the prior year through 30 June 2024.

Janus Henderson actively participates in a variety of independent ESG/CSR benchmarking exercises including with firms such as MSCI, Sustainalytics, DJSI, UN PRI, and CDP to evaluate the sustainability of our practices alongside our peers. As of November 2024, our firm received a AAA rating from MSCI. This rating keeps us in the top cohort of 7% of industry peers (which has shrunk from 10% last year), defined by MSCI as the 27 asset managers and custody banks in the MSCI ACWI index.

Janus Henderson Group is rated at the parent company level and continues to maintain the following ESG Ratings

• MSCI: AAA as of November 2024
• Sustainalytics: 16.8 / low risk as of December 2024
• CDP: C as at December 2024
• FTSE Russell ESG Scores: 3.9/5 as of June 2024
• ISS: C- ESG Corporate Rating (E&S ratings updated as of September 2024, G updated as of May 2024)

Further, in February 2024, Janus Henderson’s ESG commitment level rating was upgraded by Morningstar from Low to Basic, where many of our peers are ranked. This is a very important development as many clients look to these ratings as evidence of our ESG capabilities. Furthermore, any individual fund’s ESG rating cannot be more than one notch higher than the firm-wide rating, so this will enable ESG rating upgrades to ‘Advanced’ for some of our strategies.

The Responsible Investment Brand Index (RIBI™) is an index scale that evaluates more than 600 asset managers on their commitment to responsible investment and branding. In April 2025, RIBI™ rated Janus Henderson Investors "Avant-Gardist" for the second year in a row. This rating is their highest distinction, with only 20% of asset managers assessed achieving this category.

ESG Affiliations, Memberships, Initiatives and Certifications

In addition to being a founding signatory of the United Nations-supported Principles for Responsible Investment (PRI), Janus Henderson is involved in a wide range of ESG-related initiatives and working groups as a member, supporter or in an advisory capacity.

Our participation in industry working groups along with our sharing of insights and knowledge of ESG through our published materials reflects our status as an active proponent of sustainable investing.

For the full list of our ESG Affiliations, Memberships and Certification details please refer to the Affiliations section in our website: Responsibility-Related Affiliations at Janus Henderson - Janus Henderson Investors

In addition, we publicly support standard setters and industry groups who work with governments to implement stronger sustainability standards in the investment management industry. Where possible, we contribute to ESG policy and regulatory discussions through our response to consultations.

Thought Leadership

As part of our commitment to advancing the industry dialogue around ESG, we seek to make the thinking of our investment teams widely available to our clients, shareholders, and other stakeholders through a variety of content, including white papers, articles, podcasts, videos, and panel debates. As with our ESG research, we aim to publish content that contains thoughtful, practical, research-driven, and forward-looking insights.

In 2024, we generated 25 thought leadership and educational pieces on ESG topics. The insights included portfolio manager-specific views related to sustainable investment themes, including relevant topics such as responsible AI investing, the changing regulatory landscape, and our 2024 ESG Outlook.
In terms of specific themes and topics, we produced broader papers and debates on a variety of ESG issues, including methane emissions from the oil & gas industry, deforestation, the role of metals in decarbonisation, renewable energy, and electric and autonomous vehicles. We also published articles outlining our approach to ESG and natural capital investing.

For further information on Janus Henderson’s ESG capabilities, policies, engagement etc., please visit to the ESG Resource Library in our website: ESG Resource Library at Janus Henderson - Janus Henderson Investors.

Dialshifter

This fund is helping to ‘shift the dial from brown to green’:

The Fund seeks a responsible approach to investing in the shares and bonds of global companies by incorporating environmental, social and governance (ESG) factors in investment decisions and by avoiding companies that the investment manager considers to be involved in business activities and behaviours that may be environmentally and/ or socially harmful.

SDR Labelling:

Unlabelled with sustainable characteristics

SDR Literature:

• Consumer Facing Disclosure