SUSTAIN

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Lysis Bourget-VenninSuday JainVanessa CaronJimmy 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 environme

ntal performan

ce

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 Performanc

e

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 Responsibil

ity

Good Governan

ce

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

Octob

er (0

6)

Decem

ber (

06)

Febr

uary

(07)

April

(07)

June

(07)

Augus

t (07

)

Octob

er (0

7)

Decem

ber (

07)

Febr

uary

(08)

April

(08)

June

(08)

Augus

t (08

)

Octob

er (0

8)

Decem

ber (

08)

Febr

uary

(09)

April

(09)

June

(09)

Augus

t (09

)

-25.00%

-20.00%

-15.00%

-10.00%

-5.00%

0.00%

5.00%

10.00%

15.00%

20.00%

Abbe SRI FundRussell 2000

• 3-year rate of return: -10.04%• 3-year benchmark (Russell 2000

index): -9.35%• Expense Ratio: 1.25%• Turnover Ratio: 252%• Asset Class: Small Growth

WINSLOW GREEN GROWTH FUND

Octob

er (0

6)

Decem

ber (

06)

Febr

uary

(07)

April

(07)

June

(07)

Augus

t (07

)

Octob

er (0

7)

Decem

ber (

07)

Febr

uary

(08)

April

(08)

June

(08)

Augus

t (08

)

Octob

er (0

8)

Decem

ber (

08)

Febr

uary

(09)

April

(09)

June

(09)

Augus

t (09

)

-40.00%

-30.00%

-20.00%

-10.00%

0.00%

10.00%

20.00%

30.00%

Winslow Green GrowthMorningstar Small-Cap Core

• 3-year rate of return: -26.69%• 3-year benchmark (Morningstar

Small Cap Core): -12.28%• Expense Ratio: 1.20%• Turnover Ratio: 113%• Asset Class: Mid-Cap Growth

CALVERT SOCIAL INVESTMENT EQUITY FUND

Octob

er (0

6)

Decem

ber (

06)

Febr

uary

(07)

April

(07)

June

(07)

Augus

t (07

)

Octob

er (0

7)

Decem

ber (

07)

Febr

uary

(08)

April

(08)

June

(08)

Augus

t (08

)

Octob

er (0

8)

Decem

ber (

08)

Febr

uary

(09)

April

(09)

June

(09)

Augus

t (09

)

-20.00%

-15.00%

-10.00%

-5.00%

0.00%

5.00%

10.00%

15.00%

Calvert Social Investment Equity FundS&P 500

• 3-year rate of return: -3.68%• 3-year benchmark (S&P 500): -

15.43%• Expense Ratio: 0.67%• Turnover Ratio: 51%• Asset Class: Large Growth

CONFIDENCE INTERVAL TESTING

Benchmarks Russel 2000Growth

Morningstar Small-Cap Core

S&P 500

95% C.I. 0.04±2.4 -0.07±2.588 -0.302±1.922

Funds Abbe SRI Winslow Green Growth

Calvert Social Investment Equity Fund

95% C.I. -0.072±2.245 -0.359±3.292 0.058±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?