RL360 - Change to investment policy – Threadneedle (Lux) funds

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Change to investment policy – Threadneedle (Lux) funds

Threadneedle Management Luxembourg SA ("Threadneedle") has announced an amendment to the investment

policy of a number of funds in their range ("the Funds"). These changes will take effect 1 December 2021

Amendment to the investment policies of the Funds to introduce the promotion of environmental and social characteristics

The Funds will promote environmental and social characteristics by integrating a range of responsible investment measures into the investment decision-making process. The Fund also aims to exclude companies that breach accepted international standards and principles (e.g. the United Nations Global Compact). Threadneedle do not expect these amendments to the investment policies to result in significant changes to the way in which the Funds are currently managed.


Available in our open-architecture products

The Funds feature in our open-architecture products and will be subject to changes detailed in the Threadneedle notification document opposite.


Available in our defined fund range products

The Funds can be found in our defined fund range products; a summary of the changes to the investment objective and policy are detailed in the tables below.


You can view a copy of the Threadneedle notification document opposite for a detailed breakdown of all the changes.


Fund name (and ISIN)

Specific to Defined Fund Range Product

Threadneedle (Lux) European Smaller Companies 1E Acc EUR (LU1864952335)

PIMS Focused

Oracle, Paragon

Quantum (including Malaysia variant)

Regular Savings Plan (including Malaysia variant)

LifePlan

Threadneedle (Lux) Global Select 1U Acc USD (LU1864957219)


Oracle, Paragon

Quantum (including Malaysia variant)

Regular Savings Plan (including Malaysia variant)

Threadneedle (Lux) European High Yield Bond 1E Acc EUR (LU1829334579)


Threadneedle (Lux) European High Yield Bond 1G Acc GBP (LU1829334652)

PIMS Focused


Additional text from the Effective Date

Investment Objective and Policy (benchmark disclosure section)


The Fund promotes environmental and social characteristics by aiming to compare favourably against the index over rolling 12-month periods when assessed according to the Columbia Threadneedle ESG Materiality Rating, as set out below. The index is not designed to specifically consider environmental or social characteristics.

Investment Objective and Policy (new section)

Promotion of Environmental and Social Characteristics


The Fund-Advisor promotes environmental and social characteristics by integrating a range of responsible investment measures into the investment decision-making process.


Over rolling 12-month periods, the Fund aims to compare favourably with the relevant fund Index according to the Columbia Threadneedle ESG Materiality Rating - a proprietary model which builds on the Sustainability and Accounting Standards Board (SASB®) framework. This model identifies material environmental, social and governance (“ESG”) factors across a broad range of sectors, and provides an insight into the management focus and standards of operating practices of a company. The Fund-Advisor considers that companies that manage ESG risks effectively are better positioned to address future challenges, and capitalise on unknown and known future business opportunities. Companies that lead on the most material ESG metrics should be well positioned to build competitive advantage and sustain their long-term future.


The Fund also aims to exclude companies that breach accepted international standards and principles (e.g. the United Nations Global Compact). Companies in breach may be assessed as suitable for investment by the Fund, if in the opinion of the Fund-Advisor there are tangible mitigating factors for the company to be held.

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For the Equity Funds:

The Sub-Advisor ensures that at least:

• 90% of equity securities issued by large companies domiciled in developed countries; and

• 75% of equity securities issued by large companies domiciled in Emerging Market Countries or by small and medium companies,

held by the Portfolio are rated against the above measures. For the purposes of this test, small companies are those with a market capitalisation below €5 billion, medium companies are those between €5 billion and €10 billion and large companies are those above €10 billion.


For the Bond Funds:

The Sub-Advisor ensures that at least two thirds of the fixed income securities held by the Portfolio are rated against the above measures.

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To support and enhance the promotion of environmental and social characteristics, the Sub-Advisor will seek proactive engagement with companies with a view to influencing management teams to improve their practices, for example on issues relating to carbon emissions.


Further information on the Portfolio investment guidelines, including the Columbia Threadneedle ESG Materiality Rating methodology and engagement policy, is available at columbiathreadneedle.com.


The Portfolio is categorised as one that promotes environmental or social characteristics under Article 8 of the EU Regulation 2019/2088 on sustainability-related disclosures in the financial services sector (SFDR).


Typical Investor’s Profile


This Fund is suitable for investors who:

• seek an investment that promotes environmental and social characteristics.


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For more information about Threadneedle Funds visit www.columbiathreadneedle.com