# Impact Measurement on our Key Sustainability Themes²
Management Report
In January, the MSCI All Country World Index Net Total Return expressed in euros rose by 5.3% and the BL Sustainable Horizon (B share) gained 2.8%. During the month, we initiated positions in the following companies:
Keysight Technologies is the world leader in the field of electronic measurement. Its product portfolio includes hardware such as oscilloscopes and increasingly software (19%) – software related revenues are high-margin, recurring and fast-growing. The company was founded in 2015 after the spin-off from Agilent, itself a spin-off from HP. Today the end markets served by Keysight are very diversified, from telecoms (4/5G), aerospace and defence to semiconductors, providing a natural hedge in the event of an economic slowdown. In terms of its sustainability profile, the company acts as an innovation accelerator and joins the thematic pocket with a focus on SDG 9: industrial innovation.
IDEX Corporation is an American manufacturer of pumping equipment. The company operates in three segments: Fluid & Metering (36%), Health & Science (41%), and Fire & Safety (23%). It generates 50% of its revenues in the US and 25% in Europe, from various sectors such as water management, healthcare and defence. Idex is gaining market share and enjoys 30-40% of recurring revenues as the equipment wears out and needs maintenance or replacement. Given the nature of the equipment, which is both mission-critical to its customers and at the same time represents only a fraction of their costs, Idex has a loyal customer base that is unlikely to switch to less expensive and less efficient suppliers. In this field, defective products could lead to costly disruptions and considerable environmental/safety risks. In terms of its sustainability profile, a majority of the revenue is aligned with SDG 6.4: increase water use efficiency. Other positive impacts are aligned with a safe society (SDG 16) and good health (SDG 3).
At the end of the month, the split between the quantitative and thematic pockets was 45.8% and 46.6%.
BL Sustainable Horizon is managed using a bottom-up, conviction-based, long-term strategy aimed at investing in high-quality companies with a strong and tangible competitive advantage, solid growth prospects, an above-market-average ESG profile, and attractive valuations.
The fund's management approach integrates extra-financial analysis (ESG) and financial analysis across a multi-dimensional investment process.

## Extra-financial dimension:
- Exclusions:Companies involved in the production of controversial weapons and companies generating more than 5% of their revenues in highly controversial activities (tobacco, GMOs, weapons, alcohol, nuclear and fossil fuels, and gambling) are excluded from the portfolio.
- Quantitative extra-financial analysis:Quantitative E/S/G screening (MSCI ratings): only companies whose average rating is greater than or equal to 5 out of 10 and have no individual rating below 4 out of 10 are selected as eligible for investment.
- Qualitative extra-financial analysis - themed segment:Selection of companies whose products or services contribute to reducing social and environmental imbalances. The UN’s Sustainable Development Goals (SDGs) represent the core principle of this themed approach.


## Financial dimension – Business-Like Investing:
Companies considered for inclusion in the portfolio must meet the following criteria:
- The company's business model must be based on a strong and sustainable competitive advantage.
- There is strong visibility on the company’s capacity to generate free cash flow.
- Capital is allocated in the best interest of shareholders and other stakeholders.
- The valuation must not be excessive in relation to the company’s estimated intrinsic value.


## Schematic representation of the investment approach
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Any reproduction of this document is subject to the prior written consent of BLI. Specific Information concerning MSCI Data:
All MSCI data is provided “as is”. Neither MSCI nor any other party involved in or related to compiling, computing or creating the MSCI data makes any
express or implied warranties or representations with respect to such data (or the result to be obtained by the use thereof) and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability or fitness for a particular purpose with respect to any such data. Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any third party involved in or related to compiling, computing or creating the data have any liability for any direct, indirect, special punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages. No further distribution or dissemination of the MSCI data is permitted without MSCI’s express written consent.
Specific Information concerning GICS Data:
The Global Industry Classification Standard (“GICS”) was developed by and is the exclusive property and a service mark of MSCI Inc. (“MSCI”) and Standard and Poor’s, a division of The McGraw-Hill Companies, Inc. (“S&P”) and is licensed to use by Banque de Luxembourg S.A.. Neither MSCI, S&P nor any third party involved in making or compiling the GICS or any GICS classifications makes any express or implied warranties or representations with respect to such standard or classification (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability and fitness for a particular purpose with respect to any of such standard or classification. Without limiting any of the foregoing, in no event shall MSCI, S&P, any of their affiliates or any third party involved in making or compiling the GICS or any GICS classification have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if noticed of the possibility of such damages.
Specific Information for Switzerland:
Legal documentation of the fund may be obtained, free of charge, at the offices of the Swiss representative, CACEIS (Switzerland) S.A.,7-9, Chemin de Précossy, CH-1260 Nyon, Switzerland, in accordance with the provisions of the Swiss Collective Investment Schemes Act of 23 June 2006 (“CISA”).
The SICAV has appointed Banque CIC (Suisse) SA, Marktplatz 13, CH-4001 Bâle, Switzerland to act as paying agent for Switzerland. The present document may be distributed to Swiss qualified investors.
Specific Information for France:
The present document may be distributed to French professional investors.

Translation (ENFR, 2023-01-31):
# Répartition selon les thèmes clés de durabilité²
Rapport de gestion
En janvier, l’indice MSCI All Country World Index Net Total Return exprimé en euros a avancé de 5.3 % et le BL Sustainable Horizon (part B) de 2.8 %. Au cours du mois de janvier, nous avons pris des positions initiales dans les entreprises suivantes :
KEYSIGHT TECHNOLOGIES est le leader mondial dans le domaine de la mesure électronique. Le portefeuille de produits comprend du hardware tel que des oscilloscopes et de plus en plus de software (19%) - part des revenus à marge élevée, récurrente et en forte croissance. L’entreprise a été créée en 2015 après le spin-off d’Agilent, lui-même un spin-off de HP. Aujourd’hui les marchés finaux servis par Keysight sont très diversifiés, depuis la télécommunication (4/5G), l’aérospatiale et défense au semi-conducteur, permettant un hedge naturel en cas de ralentissement économique. Au niveau du profil durable, l’entreprise agit comme accélérateur d’innovation et intègre la poche thématique avec un accent sur l’ODD 9 : innovation de l’industrie.
IDEX Corporation est un fabricant américain d'équipements de pompage. L’ entreprise opère dans 3 segments : Fluid & Metering (36%), Health & Science (41%), et Fire & Safety (23%). L’entreprise réalise 50% de ses revenus aux US et 25% en Europe, et ce de secteurs divers tel que la gestion de l'eau, la santé et la défense. Idex gagne des parts de marché et bénéficie de 30-40% de revenus récurrents grâce à l’usure des équipements. Etant donné la nature des équipements, à la fois essentielle pour ses clients et en même temps ne représentant qu’une fraction des coûts, Idex a une base de clients fidèle qui ne risque pas de changer vers des fournisseurs moins coûteux et moins performants. En effet, des produits défectueux pourraient entraîner des perturbations coûteuses ainsi que des risques élevés environnementaux/de sécurité. Au niveau de la durabilité, une majorité des revenus est alignée avec l’ODD 6.4 : augmenter l’utilisation rationnelle des ressources en eau. D’autres impacts positifs sont alignés avec une société sûre (ODD 16) etla bonne santé (ODD 3).
A la fin du mois, la répartition entre la poche quantitative et thématique, se situe à 45.8 % et 46.6%.

#### Méthode d’évaluation de l’impact réalisé

#### Le gérant vise à atteindre des objectifs environnementaux, sociaux et de gouvernance concrets :
- Limitation du réchauffement climatique (impact environnemental),
- Mise en place de conditions de travail de qualité au sein des entreprises (impact social),
- Respect des Droits Humains tels que définis par les Nations Unies,
- Existence de Conseils d’Administration (CA) indépendants et paritaires (Hommes/Femmes) (impact de gouvernance). Ces objectifs d’impact sont mesurés régulièrement au travers des indicateurs suivants :
- Mesure de performance environnementale : Emissions de gaz à effet de serre (intensité carbone) ;
- Mesure de performance sociale : Nombre de controverses sévères dans le domaine de la gestion des ressources humaines
- (rémunération, heures de travail prestées, respect de la vie privée, abus en cas de licenciement ou de réduction des effectifs…) ;
- Mesure de performance en matière de respect des Droits de l'Homme : Signature du Global Compact des Nations Unies et évaluation de
- la conformité des pratiques de l’entreprise avec ce dernier ;
- Mesure de performance en termes de gouvernance : Indépendance des membres du Conseil d’Administration, Parité Hommes-Femmes
- au sein du CA.


### Dimension financière – Business-Like Investing:

#### Les entreprises envisagées pour figurer dans le portefeuille doivent répondre aux critères suivants :
- Le modèle économique de l'entreprise doit être fondé sur un avantage concurrentiel fort et durable.
- Il existe une forte visibilité sur la capacité de l'entreprise à générer des flux de trésorerie disponibles.
- Le capital est alloué dans le meilleur intérêt des actionnaires et des autres parties prenantes.
- L'évaluation ne doit pas être excessive par rapport à la valeur intrinsèque estimée de la société.


### Représentation schématique de l'approche d'investissement
Le présent document est une communication publicitaire et est uniquement destiné aux investisseurs institutionnels. Il fait référence directement ou de manière indirecte à un ou plusieurs produits financiers (le « Produit Financier »). Les informations économiques et financières contenues dans cette publication sont communiquées à des fins d’information uniquement sur la base des informations connues à la date de publication. Ces informations ne constituent pas un conseil d’investissement, une recommandation ou incitation à investir et ne doivent en aucun cas être interprétées comme des conseils légaux ou fiscaux. Aucune garantie n’est donnée quant à l’exactitude, la fiabilité, la récence ou l’exhaustivité de ces informations.
BLI - Banque de Luxembourg Investments ( « BLI ») attire l’attention de tout destinataire du présent document sur la nécessité d’utiliser avec la plus grande précaution toutes les informations relatives à un Produit Financier, notamment celles relatives aux performances de ce Produit Financier :
- Le cas échéant, tous les scénarios relatifs aux performances futures présentés dans ce document sont une estimation de ces performances futures à part des données du passé relatives aux valeurs du Produit Financier et/ou aux conditions actuelles. Ils ne constituent pas un indicateur exact et d’autres facteurs tenant à l’évolution du marché et la durée de détention du Produit Financier doivent être pris en compte.


#### •Réciproquement, les performances passées du Produit Financier ne préjugent pas des performances futures de ce Produit Financier.
De manière générale, BLI n’assume aucune responsabilité quant au rendement futur de ces Produits Financiers et ne sera pas responsable des décisions qu’un investisseur pourrait prendre sur la base de ces informations. Les personnes intéressées doivent s’assurer qu’elles comprennent tous les risques inhérents à leurs décisions d’investissement et doivent s’abstenir d’investir tant qu’elles n’ont pas soigneusement évalué, en collaboration avec leurs propres conseillers, l’adéquation de leurs investissements à leur situation financière spécifique, en particulier concernant les aspects légaux, fiscaux et comptables.
Elles doivent, en outre, tenir compte de toutes les caractéristiques et de tous les objectifs du Produit Financier, notamment lorsque celui-ci fait référence aux aspects liés à la durabilité conformément au règlement (UE) 2019/2088 du Parlement Européen et du Conseil du 27 novembre 2019 sur la publication d’informations en matière de durabilité dans le secteur des services financiers.
Les souscriptions ne sont autorisées que sur la base du prospectus actuel, du dernier rapport annuel ou semestriel et du Document d’Information Clé (KID) (les « Documents »). Les Documents sont disponibles gratuitement auprès de BLI à tout moment. L’ensemble des Documents, y compris les informations liées à la durabilité, est disponible sur le site internet de BLI à l’adresse www.bli.lu.

#### Toute reproduction de ce document est soumise au consentement écrit et préalable de BLI. Specific Information concerning MSCI Data:

#### All MSCI data is provided “as is”. Neither MSCI nor any other party involved in or related to compiling, computing or creating the MSCI data makes any
express or implied warranties or representations with respect to such data (or the result to be obtained by the use thereof) and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability or fitness for a particular purpose with respect to any such data. Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any third party involved in or related to compiling, computing or creating the data have any liability for any direct, indirect, special punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages. No further distribution or dissemination of the MSCI data is permitted without MSCI’s express written consent.

#### Specific Information concerning GICS Data:
The Global Industry Classification Standard (“GICS”) was developed by and is the exclusive property and a service mark of MSCI Inc. (“MSCI”) and Standard and Poor’s, a division of The McGraw-Hill Companies, Inc. (“S&P”) and is licensed to use by Banque de Luxembourg S.A.. Neither MSCI, S&P nor any third party involved in making or compiling the GICS or any GICS classifications makes any express or implied warranties or representations with respect to such standard or classification (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability and fitness for a particular purpose with respect to any of such standard or classification. Without limiting any of the foregoing, in no event shall MSCI, S&P, any of their affiliates or any third party involved in making or compiling the GICS or any GICS classification have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if noticed of the possibility of such damages.

#### Specific Information for Switzerland:

#### L

#### P
egal documentation of the fund may be obtained, free of charge, at the offices of the Swiss representative, CACEIS (Switzerland) S.A.,7-9, Chemin de récossy, CH-1260 Nyon, Switzerland, in accordance with the provisions of the Swiss Collective Investment Schemes Act of 23 June 2006 (“CISA”).

#### The SICAV has appointed Banque CIC (Suisse) SA, Marktplatz 13, CH-4001 Bâle, Switzerland to act as paying agent for Switzerland. The present document may be distributed to Swiss qualified investors.

#### Specific Information for France:

#### The present document may be distributed to French professional investors.