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Solaris Investment Management Limited

PRI reporting framework 2020

Basic information [OO 01 - 09] Asset class implementation gateway indicators [OO 10 - 12] Peering questions [OO LE 01 - HF 01]

Strategy and Governance

Objectives and strategies [SG 05 - 06] Governance and human resources [SG 07 - 08] Promoting responsible investment [SG 09 - 11] Outsourcing to fiduciary managers and investment consultants [SG 12] ESG issues in asset allocation [SG 13 - 15] Innovation [SG 18] Communication [SG 19]

Direct - Listed Equity Incorporation

ESG incorporation in actively managed listed equities [LEI 01 - 10] Implementation processes [LEI 01 - 10] (A) Implementation: Screening [LEI 04 - 06] (C) Implementation: Integration of ESG factors [LEI 08 - 10] Outputs and outcomes [LEI 12 - 13]

Direct - Listed Equity Active Ownership

Overview [LEA 01] Engagement [LEA 02 - 08] Outputs and outcomes [LEA 09 - 11] (Proxy) voting and shareholder resolutions [LEA 12 - 21]

Confidence building measures

Confidence building measures [CM1 01 - 07]

Export Public Responses

You are in Strategy and Governance » Investment policy

Investment policy

SG 01. RI policy and coverage

New selection options have been added to this indicator. Please review your prefilled responses carefully.

01.1. Indicate if you have an investment policy that covers your responsible investment approach.

Yes

01.2. Indicate the components/types and coverage of your policy.

Select all that apply

Policy components/types

Coverage by AUM

Policy setting out your overall approach

Formalised guidelines on environmental factors

Formalised guidelines on social factors

Formalised guidelines on corporate governance factors

Fiduciary (or equivalent) duties

Asset class-specific RI guidelines

Sector specific RI guidelines

Screening / exclusions policy

Engagement policy

(Proxy) voting policy

Other, specify (1)

Other, specify(2)

Applicable policies cover all AUM

Applicable policies cover a majority of AUM

Applicable policies cover a minority of AUM

01.3. Indicate if the investment policy covers any of the following

Your organisation’s definition of ESG and/or responsible investment and it’s relation to investments

Your investment objectives that take ESG factors/real economy influence into account

Time horizon of your investment

Governance structure of organisational ESG responsibilities

ESG incorporation approaches

Active ownership approaches

Reporting

Climate change

Understanding and incorporating client / beneficiary sustainability preferences

Other RI considerations, specify (1)

Other RI considerations, specify (2)

01.4. Describe your organisation’s investment principles and overall investment strategy, interpretation of fiduciary (or equivalent) duties,and how they consider ESG factors and real economy impact.

Solaris picks stocks using fundamental analysis to exploit market inefficiencies in forecasts and valuations.

To optimise the conversion of fundamental research into investment portfolios, we empower our analysts by combining their analytical role with that of portfolio manager. This combination ensures the portfolio is constructed purely from the ground-up using the knowledge and skill of the people at the analytical ‘coal face’. Within this process, the analyst actively considers ESG factors as part of the bottom up stock assessment and this assessment directly influences whether the stock is included or excluded from the portfolio.

The analyst is responsible for the stock-picking decision from beginning to end and is held accountable by crystal-clear performance attribution. This performance attribution then drives their annual remuneration outcomes.

01.5. Provide a brief description of the key elements, any variations or exceptions to your investment policy that covers your responsible investment approach. [Optional]

There are no exceptions to the investment policy

01.6. Additional information [Optional].

SG 01 CC. Climate risk (Private)

SG 02. Publicly available RI policy or guidance documents

Solaris Investment Management has an ESG Policy that describes how ESG factors are incorporated into our every day investment decision making. The ESG Policy is an integral part of our investment process. The Solaris team has been actively involved in assessing the impacts of ESG factors for over 20 years (both at Solaris and previously at another funds management group). We have witnessed the impacts of ESG factors on stock valuations and consider ESG factors as another important source of stock value drivers. We see structural shifts occurring in investment markets as sustainability becomes more "front of mind" for investors and believe that understanding ESG factors is key to reducing portfolio risks and identifying investment opportunities as they evolve.

The existing Solaris ESG Policy was first adopted in 2010 and is reviewed and approved by the Solaris Board annually.

Solaris now manages three negatively screened investment products which operate as part of our overall investment process with additional screening applied as per the clients' exclusions. The exclusions are monitored as per the clients' Individual Mandate Agreements (IMAs).

SG 03. Conflicts of interest

03.1. Indicate if your organisation has a policy on managing potential conflicts of interest in the investment process.

Yes

03.2. Describe your policy on managing potential conflicts of interest in the investment process.

Conflicts of Interest are specifically dealt with in the Solaris Conflicts of Interest Policy. For Solaris’ purposes, a conflict of interest will include any matter which impacts on our ability to ensure that financial services authorised by our licence are provided efficiently, honestly and fairly. Solaris adheres to the principle that the Board will always ensure the Company conducts its financial services business in a fair, honest and professional manner in line with the regulatory objective of ensuring the confident and informed participation of consumers and investors in the Australian financial system. For a disclosure to be adequate it should provide detail in a clear, concise and effective form to allow clients to make an informed decision. Sections 912A(1)(aa) of the Corporations Act 2001, section 601FC(1)(C) and 601FD(1)(c) of the Act describe Solaris’ obligations.

03.3. Additional information. [Optional]

SG 04. Identifying incidents occurring within portfolios (Private)

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