Status under the EU Sustainable Finance Disclosure Regulation (SFDR)

Janus Henderson Horizon Responsible Resources Fund

Legal entity identifier: 213800SUMWA13II54903

A. Summary

The Fund is categorised as one which meets the provisions set out in Article 8 of SFDR as a product which promotes environmental and/or social characteristics and invests in companies with good governance practices, but does not have as its objective sustainable investment.

The Fund promotes climate change mitigation, support for the UNGC principles (which cover matters including human rights, labour, corruption and environmental pollution) and investment in companies aligned with the following sustainability themes: energy transition; sustainable mobility; sustainable industry; sustainable agribusiness; and carbon reduction. The Fund does not use a reference benchmark to attain its environmental or social characteristics.

This Fund seeks capital growth through investment in the global equity markets and specifically through exposure to the natural resources sector.

The binding elements of the investment strategy described below are implemented as exclusionary screens which are coded into the compliance module of the Investment Manager’s order management system utilising third-party data provider(s) on an ongoing basis. The exclusionary screens are implemented on both a pre and post trade basis enabling the investment manager to block any proposed transactions in an excluded security and identify any changes to the status of holdings when third-party data is periodically updated.

The binding criteria to gain exposure to companies aligned to at least one of the sustainability themes referenced above is overseen by periodic desk reviews to identify that sufficient research has been undertaken and documented to evidence that issuers within the Fund make a positive contribution towards and have been correctly mapped to the sustainability themes referenced below.

The Investment Manager uses specific screens to help achieve some of the promoted characteristics. For example - to promote climate change mitigation, screens are applied to avoid investment in certain high carbon activities, and it is expected that this will result in the fund having a lower carbon profile.  Another example is that to promote support for the UNGC Principles, screens are applied so that the Fund does not invest in issuers that are in breach of the UNGC Principles based on third party data and/or internal research.

The Investment Manager applies screens to exclude direct investment in issuers based on their involvement in certain activities. Specifically, issuers are excluded if they derive more than 10% of their revenue from the production of fossil fuels. Issuers are also excluded if they are deemed to have failed to comply with the UNGC Principles (which cover matters including human rights, labour, corruption, and environmental pollution).

In addition to the above the Investment Manager applies screens against the activities defined, as at the date of this prospectus, in Article 12 Exclusions for EU Paris-aligned Benchmarks of the Commission Delegated Regulation (EU) 2020/1818 of 17 July 2020. Specifically, companies are excluded if they have any involvement in the following:

1. companies involved in any activities related to controversial weapons;
2. companies involved in the cultivation and production of tobacco;
3. companies that benchmark administrators find in violation of the United Nations Global Compact (UNGC) principles or the Organisation for Economic Cooperation and Development (OECD) Guidelines for Multinational Enterprises;
4. companies that derive 1 % or more of their revenues from exploration, mining, extraction, distribution or refining of hard coal and lignite;
5. companies that derive 10 % or more of their revenues from the exploration, extraction, distribution or refining of oil fuels;
6. companies that derive 50 % or more of their revenues from the exploration, extraction, manufacturing or distribution of gaseous fuels;
7. companies that derive 50 % or more of their revenues from electricity generation with a GHG intensity of more than 100 g CO2 e/kWh.

For the purposes of point (a), controversial weapons shall mean controversial weapons as referred to in international treaties and conventions, United Nations principles and, where applicable, national legislation.

The Fund also applies the Firmwide Exclusions Policy (see “Firmwide Exclusions” in the JHI Responsible Investment Policy”), which includes controversial weapons.

The investment strategy of the Fund seeks to gain an at least 80% exposure to companies aligned with at least one of the following sustainability themes: energy transition; sustainable mobility; sustainable industry; sustainable agribusiness; and carbon reduction.

For the purposes of the AMF doctrine, the extra-financial analysis or rating as described above is higher than:

1. 90% for equities issued by large capitalisation companies whose registered office is located in "developed" countries, debt securities and money market instruments with an investment grade credit rating, sovereign debt issued by developed countries.
2. 75% for equities issued by large capitalisations whose registered office is located in "emerging" countries, equities issued by small and medium capitalisations, debt securities and money market instruments with a high yield credit rating and sovereign debt issued by "emerging" countries.

The Investment Manager may only invest in companies that would be excluded by the screens described above if the Investment Manager believes, based on its own research and as approved by its ESG Oversight Committee, that the third-party data used to apply the exclusions is insufficient or inaccurate.

The Investment Manager may consider that the data is insufficient or inaccurate if, for example, the third-party data provider research is historic, vague, based on out of date sources, or the investment manager has other information to make them doubt the accuracy of the research.

If the Investment Manager wishes to challenge the third-party data then the challenge is presented to a cross-functional ESG Oversight Committee who must sign off on the “override” of the third-party data.

If a third party data provider does not provide research on a specific issuer or excluded activity, the Investment Manager may invest if, through its own research, it is satisfied that the issuer is not involved in the excluded activity.

JHI has chosen MSCI as its primary data source for ESG (Environmental, Social and Governance) research.

Where coverage gaps are identified, specialist ESG Data vendors or inhouse research may be used to complement the ESG research. This helps ensure that consistent data and methodologies are used given an ESG measure per security type and hence can be compared correctly in the portfolio construction process.

The JHI Responsible Investment Policy, which incorporates JHI’s Sustainability Risk Policy, sets out the firmwide approach to ESG Integration Principles, including JHI’s Responsible Investment Principles for long-term investment success, our approaches to Stewardship and Engagement and Baseline Exclusions applied to investee companies.