Notification of changes to the underlying funds of various Fidelity funds
03 Jul 2024
Notification of changes to the underlying funds of:
- L47 Fidelity America
- J87 Fidelity Euro Bond
- L46 Fidelity Global Dividend
- L71 Fidelity Global Focus (GBP)
- L85 Fidelity US Dollar Bond
(“Affected Mirror Funds 1-5”)
- L62 Fidelity Funds Euro Cash (EUR)
- L60 Fidelity Funds US Dollar Cash (USD)
(“Affected Mirror Funds 6-7”)
- J84 Fidelity Sustainable Europe Equity
(“Affected Mirror Fund 8”)
(together the “Affected Mirror Funds”)
We have been notified by Fidelity Funds ("Fidelity") of the following upcoming changes to the underlying funds of the Affected Mirror Funds named above. These changes will take effect from 30 July 2024 (the “Effective Date”).
Any terms not defined herein shall have the same meaning as in the relevant prospectus of the underlying funds of the Affected Mirror Funds.
Background
As part of its ongoing commitment to responsible and sustainable investing, Fidelity is updating its approach to Sustainable Investing and environmental, social and governance (“ESG”) integration to reflect the evolving sustainable investing landscape and enhance transparency to investors. Details of the ESG criteria used by Fidelity can be found on its website: https://fidelityinternational.com/sustainable-investing-framework/.
Please note that this is an external publicly accessible website which has no affiliation with FPIL and we cannot corroborate or verify the information contained within.
Changes relating to Affected Mirror Funds 1-7
From the Effective Date, Fidelity will be introducing ESG portfolio scores to promote environmental and social characteristics of the underlying funds of Affected Mirror Funds 1-7.
The current investment process of the underlying funds of Affected Mirror Funds 1-5 provides that they invest at least 50% of their assets in securities of issuers or companies with favourable ESG characteristics.
The current investment process of the underlying funds of Affected Mirror Funds 6-7 provides that it invests at least 70% of its assets in securities of issuers with favourable ESG characteristics and up to 30% in securities of issuers with [low but] improving ESG characteristics.
From the Effective Date, these limits will no longer be included as part of the investment process of the underlying funds of Affected Mirror Funds 1-7; instead the underlying funds of Affected Mirror Funds 1-7 will aim to have an ESG score greater than that of the investment universe or benchmark of the respective underlying fund.
Changes relating to Affected Mirror Fund 8
The current investment process of the underlying fund of Affected Mirror Fund 8 provides that it invests at least 70% of the underlying assets in securities of issuers with favourable ESG characteristics.
From the Effective Date, the underlying fund of Affected Mirror Fund 8 will invest a minimum of 80% in securities with high ESG ratings and up to 20% in issuers with lower ESG ratings including those with low but improving ESG characteristics.
High ESG ratings are defined by Fidelity as issuers rated by Fidelity ESG ratings as a B or above, or in the absence of a rating from Fidelity, an MSCI ESG rating of A or above.
These changes will take effect automatically and policyholders do not need to take any action.
Should you have any questions regarding these changes, please contact the Investment Marketing Team.
