Index Strategy - FEDM




1. ESG investing is defined as utilizing environmental, social, and governance (ESG) criteria as a set of standards for a company’s operations that socially conscious investors use to screen potential investments.
2. The Northern Trust Developed Markets ex US Large Cap Index is a sub-index of the Northern Trust Global Index. The sub-index is formed by selecting all of the securities from the Northern Trust Global Index that are assigned to Developed Markets (excluding the United States), and are large-mid capitalization per Northern Trust’s methodology. The Northern Trust Global Index is designed to track the performance of the global investable equity markets covering approximately 97.5% of world’s float adjusted market capitalization. The Index’s coverage encompasses both developed and emerging markets worldwide.
3. The United Nations Global Compact is a non-binding United Nations pact to encourage businesses and firms worldwide to adopt sustainable and socially responsible policies, and to report on their implementation.
4. The Northern Trust ESG Vector Score is designed to rank companies based on their management of and exposure to material ESG metrics. The Score was designed to align with the Sustainability Accounting Standards Board (SASB) Standards. The SASB Standards were designed for investors, and focus on only financially material issues based on the industry in which the company operates. Based on that structure, the ESG Vector Score is a combination of individual ESG indicators, adjusted for industry membership.
5. Institutional Shareholder Services (ISS) ESG data enables investors to develop and integrate responsible investing policies and practices, engage on responsible investment issues, and monitor portfolio company practices through screening solutions. It also provides climate data, analytics, and advisory services to help financial market participants understand, measure, and act on climate-related risks across all asset classes.
6. All targets are in comparison to the underlying index – the Developed Markets ex US Large Cap Index.

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