Overview

Investment Process: The First Sentier Responsible Listed Infrastructure Fund is managed using an active, bottom-up process of stock selection, with an overarching focus on sustainable development and environmental, social and governance (ESG)-related criteria. The Fund’s investment process places equal emphasis on asset quality and stock valuations. Value is determined using detailed financial models. Quality is determined by a 25-point score which seeks to minimise downside by assessing significant areas of risk - from politics, regulation and customer satisfaction to leverage, management incentives and Board independence. Value and Quality results are peer reviewed to reduce analyst bias. These results, along with the Sustainability Analysis described below, underpin the Investment Manager’s stock selection and portfolio construction process. Sustainability Analysis: Analysis of a company’s ESG and sustainability-related credentials is undertaken in three ways. First, the infrastructure stocks that the Investment Manager analyses and researches are ranked using a weighted combination of the sustainability elements only of each company’s Quality score; namely – Environmental, Social, Governance, Alignment of interests, Board and Disruption. This provides a clear and consistent framework for the Investment Manager’s collective thoughts on sustainability-related criteria, to reference when stocks are being considered for inclusion within the portfolio. Second, the Investment Manager seeks to identify companies that are contributing to, or benefitting from, sustainable development, aligned with the United Nations Sustainable Development Goals (SDGs). The most relevant SDGs to infrastructure companies are SDG 6: Clean Water and Sanitation, SDG 7: Affordable and Clean Energy, SDG 9: Industry, Innovation and Infrastructure, SDG 11: Sustainable Cities and Communities, SDG 12: Responsible Consumption and Production, SDG 13: Climate Action. Third, the Investment Manager carries out company engagement via an ongoing process of outreach to companies, regulators and other stakeholders. This provides the manager with a way of driving change, as well as giving the manager a better understanding of how companies are performing. This enables the manager to push for better outcomes on an ongoing continual basis. These steps provide the Investment Manager with a lens through which all investment decisions are made. Investments in companies that do not satisfy this Sustainability Analysis will not be included within the portfolio. Avoidance of Harmful Products and Services: In addition, the Fund aims not to invest in companies with material exposure to harmful products and services, or companies that fail to discharge their environmental stewardship and human rights responsibilities which may harm the achievement of the sustainable investment objectives. The Fund also aims to ensure that the companies it invests in neither cause adverse social and environmental impacts, nor undermine other social and environmental sustainability objectives, and that the companies it invests in follow good governance practices. The Investment Manager considers harmful products and services to include: • Environmental issues: Companies that are materially involved in fossil fuels (defined as companies where coal-fired generation assets represent more than 20% of their of overall assets; or where carbon intensity - as measured by tons of carbon per MwH of electricity generated - is not declining over rolling three year periods), or companies that do not operate in alignment with the Ten Principles of the UN Global Compact. • Social issues: Companies that are materially involved in gambling, companies that are materially involved in pornography, companies that are materially involved in animal testing, companies with a poor track record in relation to globally accepted human rights, such as modern slavery, child labour, land grants and indigenous rights, or companies that do not operate in alignment with the OECD Guidelines for Multinational Enterprises. In addition, consistent with FSI exclusions, the Fund does not invest in companies involved in the manufacture of cluster munitions and anti-personnel mines, and companies whose primary business is the manufacture of cigarettes and tobacco products. The list of excluded companies is based on research from credible third parties in the case of the manufacture of cluster munitions and anti-personnel mines, and those companies in the MSCI Tobacco GICS sub-industry classification in the case of the manufacture of cigarettes and tobacco products. • Governance issues: Companies whose Board structure reduces their effectiveness or level of independence, companies with a higher risk of government interference, or companies that fail to provide the requisite level of transparency in their business or financial statements. In rare circumstances the Fund may hold investments in companies that have a non-material exposure to certain harmful products and services. The Fund will only hold such investments in circumstances where the company has strong ESG credentials overall, or if the company can demonstrate that it is taking tangible steps to improve the aspects deemed to be harmful.

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