Environmental, Social and Governance Issues

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Jean Loewenberg
General Counsel

Loomis Sayles Incorporates Environmental, Social and Governance Issues Into Its Investment Process

At the heart of Loomis Sayles’ investment management process is the goal of providing superior long-term, risk-adjusted returns for our clients. We fully recognize the important role that environmental, social and governance (“ESG”) issues play in the global economy, financial markets and society at large. Both because Loomis Sayles generally takes a longer term view in seeking value, and because we take the importance of conducting ourselves as responsible global citizens seriously, consideration of ESG issues is inherently a part of our investment decision making.

Our research analysts take into account a wide range of investment criteria, including potential ESG-related risks and opportunities that could impact the desirability and suitability of investments. The analysts strive to develop a thorough understanding of the risks and opportunities associated with an issuer’s management strength and strategy, governance, and use of human and natural resources, as well as regulatory and political risks. These factors are critical to evaluating the long-term sustainability of an issuer, its profitability and, ultimately, its expected contribution to client portfolios.

To support awareness of ESG issues among our investment professionals, Loomis Sayles makes informational and analytical resources on ESG matters easily accessible. They are expected to consider this information as part of their analysis and decision making process. While we expect our investment professionals to consider all available macro, fundamental and quantitative research insights, including those related to ESG, Loomis Sayles does not impose any ESG restrictions or exclusions on the investment process. Any restrictions and/or exclusions are mandated by our clients’ guidelines or by regulation.

Engagement is Key to Loomis Sayles’ Investment Process

Engagement is at the core of Loomis Sayles’ research process and often includes meetings with management, rating agencies and regulators. The assessment of management quality is intended to permit our investment professionals to develop an informed opinion of the issuer over time. They do this by observing management’s actions and conduct as it deals with strategy, resource management, regulatory changes, and its attention to such potential risks as environmental and climate change. ESG-related risks and opportunities are an inextricable part of the assessment.

Loomis Sayles is a Signatory to the UN Principles for Responsible Investing (“UNPRI”)

Becoming a signatory to the UNPRI is in keeping with Loomis Sayles’ commitment to its clients’ best interests and to furthering its investment professionals’ awareness of the risks and opportunities presented by ESG issues.

Loomis Sayles is a Responsible Corporate Citizen

Loomis Sayles’s business practices are consistent with our foremost priority of acting in our clients’ best interests. As with our investment process, we seek to make business decisions that reflect our sensitivity to the impacts of ESG issues. We strive to operate in an environmentally-sensitive manner by occupying LEED certified office space, by recycling, and by offering public transportation incentives. We support flexible work schedules and telecommuting, both for the good of our employees and for their impact on our carbon footprint.

We feel strongly about the importance of playing a proactive, positive role in the local community, in part through a comprehensive charitable giving program. Our charitable giving activities focus on supporting charities that work with inner-city children and families, particularly in education and health care. Loomis Sayles also encourages our employees' own charitable efforts, through firm-sponsored service days, as well as by matching their charitable donations.

Loomis Sayles views the exercise of proper oversight and the highest standard of conduct to be the underpinnings of good governance. The ultimate oversight and direction of Loomis Sayles resides with our Board of Directors, our Risk Management Committee, and is furthered by the enforcement of our Code