I N V E S T M E N T P O L I C Y S TAT E M E N T • J U LY 2 0 2 3

PIMCO’s Sustainable Investment
Policy Statement
PIMCO’s mission is to deliver superior investment returns, solutions and service to our clients.
For over 50 years, we have worked relentlessly to help millions of investors pursue their objectives– regardless of shifting market conditions. Leadership in sustainable investing is essential to deliveron our clients’ financial objectives while sustainable long-term economic growth is essential tomaintain healthy markets.
For PIMCO, sustainable investing represents an approach thatseeks to appropriately consider material issues in investment
decision making and portfolio construction. Sustainable
investing includes issuers’ impact on the environment andsociety, as well as how environmental, social and governancefactors may impact the issuer more broadly. We analyze
the extent to which environmental, social and governancefactors could impact valuations. This approach can beachieved through a process of integrating these factors into
investment research and decision making where relevant andmaterial, to ultimately help manage portfolio risks and identify
opportunities. Additionally, sustainable investing can also be• Providing sustainable investment solutions designed
to meet a client’s objectives,• Engagement with issuers to try to improve investment
outcomes and dialogue on sustainability factors andrelated risks,• The evaluation of climate change and related risks in ourinvestment analysis, and• Governance and oversight of these areas.

ESG INTEGRATION IN PIMCO’SINVESTMENT RESEARCH PROCESS

achieved through offering specific sustainable investment

At PIMCO, we define ESG Integration as the consistentsolutions that explicitly include and seek to optimize these

consideration of relevant ESG factors in our investment

factors. Sustainable investment solutions may encompass

research process with the goal of enhancing our clients’ risk-

negative screening, the proactive selection of assets based

adjusted returns. Relevant ESG factors may include but are noton more favorable environmental, social or governance (ESG)

limited to: climate change risks, resource efficiency, natural

factors relative to their investment universe (e.g. positive

capital, human capital management, human rights, regulatory

screening), and, in certain circumstances, the selection ofrisks, and reputational risk at an issuer, among others.

investments based partly on their contribution to broader

We believe incorporating relevant ESG factors should beobjectives, such as alignment with the Paris Agreement, thepart of a robust investment process. We recognize that ESG

Sustainable Development Goals (SDGs) or overall contribution

factors are increasingly essential inputs when evaluating global

to society, aligned with fiduciary duty and investment

economies, markets, industries and business models, and that

objectives. We view sustainable investing as a broader

these risks may materialize over the short, medium or long-

approach than ESG investing.

term horizons. Where relevant, these factors are important

This Sustainable Investment Policy Statement details
PIMCO’s commitment to:• The integration of relevant sustainable factors, including
environmental, social and governance factors in the firm’s
long-term investment process,considerations when evaluating investment opportunities andrisks for asset classes in both public and private markets. Ourcommitment to ESG Integration was one of the main drivers
that led PIMCO to become a signatory to the United Nations
Principles of Responsible Investment (PRI) in September 2011.

2

PIM C O S U S TA IN A B L E IN V E S T M E N T P O L ICY S TAT E M E N T

Integrating relevant factors into the evaluation process does

• Exclude: We exclude issuers fundamentally misaligned withnot mean that ESG related information is the sole or primarysustainability factors, which may be customized for clientconsideration for an investment decision; instead, PIMCO’spreferences in separately managed accounts.

portfolio managers and analyst teams consider a variety offactors and assess the materiality of those factors to makeinvestment decisions. The materiality of ESG considerations
to investment decisions varies across asset classes, strategies,
products and valuations. By increasing and diversifying theinformation available to the portfolio management team,
we are able to provide a more holistic view of an investment,
which we believe will benefit our clients.

PIMCO SUSTAINABLE INVESTMENT SOLUTIONS:ESG OPTIMIZATION
We have developed a suite of sustainable investment solutions
for clients seeking risk-adjusted returns and the inclusionof sustainable factors in the investment selection process
which may include managing the portfolio’s carbon footprint,
active engagement with issuers, green, social, sustainable orsustainability linked (GSS) bond allocations and/or a tilt toward
issuers with higher quality or improving ESG characteristics.
These investment solutions build on PIMCO’s over 50-year
core investment processes, while actively incorporating ourclients’ sustainability objectives. Clients around the world
define their sustainability objectives differently – and that
customization is supported. At PIMCO, we are eager to partnerwith clients to identify and deliver sustainability objectives
customized to their risk and return profile.

• Evaluate: Using our proprietary and independent ESG scoring
system as one factor in portfolio construction, in addition toexternally sourced and internally developed criteria, we seek
to optimize ESG portfolios to emphasize companies in eachindustry and more generally issuers with certain ESG practices,limited carbon footprint and/or high quality sustainable bondframeworks in order to target higher aggregate ESG scores
and/or criteria for these portfolios. Members of PIMCO’s global
research team are responsible for assigning ESG scores toissuers under their coverage in collaboration with our dedicated
ESG analysts, and ESG scores are augmented by insights fromPIMCO’s engagement activities.
• Engage: Our analysts engage with issuers with the objectiveof improving investment outcomes. Additionally, we believethat by collaborating with and allocating capital toward issuers
willing to improve their ESG-related business practices, thesestrategies may have more influence than simply excluding
issuers with poor ESG metrics and favoring those with strong
metrics. We conduct engagement based on ESG themesthat we believe have the most opportunity to reduce risk orcapitalize on opportunities for each specific issuer.
Thematic strategies build on the ESG Enhanced strategies
approach and are designed to incorporate a specificenvironmental and/or social objective or outcome in addition
to their financial objectives.

More specifically, our sustainable investment solutions areorganized into three categories.

ENGAGEMENT PHILOSOPHY

Exclusionary strategies restrict a portion of the investment

As one of the largest bondholders in the world, PIMCO has auniverse by excluding issuers misaligned with specificlarge and important platform with which to engage issuerssustainability factors as defined by a client’s investment objectives.

on sustainability matters. Engagement is an essential tool

ESG Enhanced strategies are designed to target a better

sustainability outcomes. We believe that sustainable investingoverall ESG profile than their investment universe. In theis not only about partnering with issuers which alreadycontext of our ESG Enhanced strategies, PIMCO’s investment

demonstrate a deeply unified approach to sustainability, but

process for commingled fund offerings applies the following

also about engaging with those issuers that are evolving theirguiding principles, which can also be applied to separately

sustainability practices. While engagements seek to benefit ourmanaged accounts:

clients’ investment objectives, they may also benefit additional

for both improving investment outcomes and influencing

stakeholders, including employees, customers, broader society
and the environment.

PIM C O S U S TA IN A B L E IN V E S T M E N T P O L ICY S TAT E M E N T

The global bond market is significantly broader andmore diverse than the equity market – providing a larger
opportunity set in terms of engagement candidates,
including private businesses, sovereigns, local authorities,
supranational issuers, etc. Additionally, bonds matureand companies need to refinance; this facilitates a close
relationship between bond investors and issuers, as
engagement can be repeated and meaningful, and can evenresult in the issuance of dedicated ESG labelled or GSS fixedincome securities – allowing investors to deploy capital inmore targeted ways and monitor how the capital is being
used through covenants and other metrics.

3

CLIMATE CHANGE INVESTMENT ANALYSISPIMCO recognizes that climate change will potentially havea profound impact on the global economy, financial markets
and issuers over a long-term investment horizon. We havedeveloped tools and methods that seek to incorporate material
climate risk evaluations in our investment research processes.
Details on PIMCO’s broad climate research approach include:• When evaluating climate-related risks and opportunities
within specific sectors and issuers, we typically begin
with two broad categories: 1) transition risks (e.g., tighter
regulations on carbon emissions) and 2) physical risks (e.g.,

We aim to have an industry leading engagement program

how the rising intensity and frequency of extreme weather

among fixed income asset managers. By investing acrossevents affects critical assets and natural resources used ordiverse asset classes and types of issuers – including but notrelied upon by the issuer);

limited to corporates and sovereigns - we believe PIMCO’s
engagement practices are ideally positioned to influencechange that benefit investment outcomes rather than throughexclusions or evaluations alone. In our experience, we havefound that our approach of collaborating with issuers has thepotential to result in tangible outcomes in certain issuers given
the strength and history of our platform.

• In sustainable portfolio solutions, the insights these tools
provide are designed to provide material information to
portfolio managers to better manage and mitigate climaterelated credit risks and assess a portfolio’s alignment with
the Paris Agreement targets1;• For portfolios with decarbonisation goals, we havedeveloped a four pronged approach of (1) reducing the

PIMCO’s credit research analysts engage regularly with thecarbon footprint, (2) investing in climate leaders, (3)issuers that they cover in the corporate space by, for example,

supporting climate solutions and (4) influencing change

discussing topics with company management teams related tothrough engagements;

corporate strategy, leverage, and balance sheet management,
as well as sustainability-related topics such as climate changetargets and environmental plans, human capital management,
board qualifications and composition.

• We explore climate change in the context of broader
sustainability risk and are supportive of the SDGs as thereference framework to assess these wide-ranging risks (e.g.
biodiversity, water scarcity, human and labor rights); and• We also seek to engage with issuers on innovative debt
issuance opportunities to advance the Paris Agreement and/or the SDGs.

1

The Paris Agreement is the global accord to limit the global temperature rise
to well below 2°, preferably to 1.5° Celsius compared to pre-industrial levels.
According to the Intergovernmental Panel on Climate Change (IPCC), global
net human-caused emissions of carbon dioxide (CO2) would need to reach ‘net
zero’ emissions around 2050 to limit global warming to 1.5 degrees Celsius.

4

PIM C O S U S TA IN A B L E IN V E S T M E N T P O L ICY S TAT E M E N T

GOVERNANCE AND OVERSIGHTPIMCO’s governance framework includes defined roles
and groups that are responsible for the various facets ofsustainable investing, including keeping our Risk Committee
and Executive Committee apprised of our efforts.
Our:• PIMCO’s Sustainability Team sets the strategic priorities forthe platform and oversees our firm wide integration efforts,

Our Sustainability Leadership Team also oversees theevaluation and approval of the firm’s participation incertain third-party sponsored partnerships (i.e., industry
engagements and/ or affiliations). We view thesepartnerships as important ways to add value for ourinvestors through increasing our knowledge and expertisein particular areas and providing leadership in areas whereinternal sustainability stakeholders have strong views, allwith the objective of reaching better investment outcomes.

including our research frameworks, systems and tools. This

PIMCO’s role as a fiduciary is a guiding principle for evaluatinggroup is responsible for PIMCO’s Sustainable Investment

potential affiliations; of paramount importance is the firm’s

Policy Statement.

role as a steward of client assets – which means that our• Executive Committee member responsible for oversight of
Sustainability oversees our ESG and Sustainability initiatives,
providing strategic direction and firm wide coordination
around our efforts.
• Head of Corporate Sustainability oversees all aspectsof corporate sustainability including the firm’s strategy,
initiatives and external partnerships.
• Portfolio Management Lead for ESG Investing coordinateswith the broader credit research team and oversees the ESG
analyst team responsible for evaluating and engaging withissuers globally, ESG integration across the trade floor, andconsistent implementation of our research frameworks.
• Head of ESG Product Strategy is responsible for productdevelopment, marketing and messaging for all of ourSustainable Investment Solutions as well as messaging
around our firm-wide integration of ESG.
• Chief of Sustainable Development and International Affairs
is responsible for the firm’s engagement in global initiatives
and platforms focused on SDG investment and financing.
• Business Management group functions each havedesignated contacts to help coordinate functional support

investment activities and commitments must be led by client
mandates and considerations expressed through investment
objectives, guidelines and/or restrictions. Asset managers havea different role to play in sustainable investing relative to asset
owners – while we can advise, educate and invest on behalf of
our asset owner clients, it is not appropriate to commit to any
course of action collectively for all clients.
Finally, while we have attempted to be comprehensive andclear in this document, as a fixed income and alternatives
manager there are many asset classes that we invest inwhich include exposure to investments other than a publiccompany. Public companies have the most extensive data
and frameworks for sustainability established to date, while
there can be significant variation for other issuer types. This
could lead to differences in the application of the principles ofsustainable investing noted throughout this policy statement,
although we hope and expect those to diminish over time.
As of July 1, 2023
For more information about PIMCO’s Sustainable
Investing capabilities, please review here.

for sustainability efforts across areas such as Operations,

For more information about PIMCO’s Corporate

Legal & Compliance, Information Technology and Marketing.

Responsibility platform, please review here.

PIM C O S U S TA IN A B L E IN V E S T M E N T P O L ICY S TAT E M E N T

5IMPORTANT INFORMATIONESG investing is qualitative and subjective by nature, and there is no guarantee that the factors utilized by PIMCO or any judgment exercised by PIMCO willreflect the opinions of any particular investor, and the factors utilized by PIMCO may differ from the factors that any particular investor considers relevant inevaluating an issuer’s ESG practices. In evaluating an issuer, PIMCO is dependent upon information and data obtained through voluntary or third-party reportingthat may be incomplete, inaccurate or unavailable, or present conflicting information and data with respect to an issuer, which in each case could cause PIMCO toincorrectly assess an issuer’s business practices with respect to its ESG practices. Socially responsible norms differ by region, and an issuer’s ESG practices or
PIMCO’s assessment of an issuer’s ESG practices may change over time. There is no standardized industry definition or certification for certain ESG categories,
for example “green bonds”; as such, the inclusion of securities in these statistics involves PIMCO’s subjectivity and discretion. There is no assurance that the ESG
investing strategy or techniques employed will be successful. Past performance is not a guarantee or reliable indicator of future results.
Environmental (“E”) factors can include matters such as climate change, pollution, waste, and how an issuer protects and/or conserves natural resources.
Social (“S”) factors can include how an issuer manages its relationships with individuals, such as its employees, stakeholders, customers and its community.
Governance (“G”) factors can include how an issuer operates, such as its leadership, pay and incentive structures, internal controls, and the rights of equity anddebt holders.
ESG Labeled Bonds are defined as green, social, and sustainable bonds and sustainability-linked bonds. Green Bonds are any type of bond instrument where
the proceeds will be exclusively applied to finance or re-finance, in part or in full, new and/or existing eligible Green Projects. Social Bonds are use-of-proceeds
bonds earmarked to finance new and existing projects or activities with positive social impacts. Sustainability Bonds are use-of-proceeds bonds earmarked tofinance new and existing projects or activities with positive environmental and social impacts. Sustainability-Linked Bonds (SLBs) are structurally linked to theissuer’s achievement of climate or broader sustainability goals, such as through a step-up in coupon if key performance indicators (KPIs) are not met.
PIMCO’s credit research analysts assess the Environmental, Social, and Governance (“ESG”) profile of corporate, municipal, and sovereign issuers relative topeer issuers with a goal of separating leaders from laggards. Using industry-specific ESG frameworks, analysts review issuers’ ESG performance based on
information available in public filings, recent ESG news and controversies, as well as through engagement with company management teams. Analysts assign
three separate numerical scores from 1 to 5 (with 5 being the highest) to their environmental, social and governance-based business practices. The score ineach category is related to an issuer’s rank relative to industry peers, and the relative weights of the E, S, and G scores in the composite score vary based on
industries, as each industry is assigned a different factor weight. For example, the environmental category has the greatest weight for issuers in extractive
industries (e.g., oil, gas, and mining), the social category has the greatest weight for pharmaceutical issuers, and the governance category has the greatest
weight for financial issuers. Analysts also include a forward-looking ESG trend assessment, which recognizes companies whose ESG performance is significantly
improving or deteriorating. These factors are combined to create a proprietary composite ESG issuer score.
PIMCO’s credit research analysts also assess green, social, sustainability, and sustainability-linked bonds (collectively “ESG bonds”) at an issuance level,
including prior to and after issuance. Utilizing PIMCO’s proprietary ESG Bond Framework assessment, credit analysts evaluate such instruments starting withthe strategic fit, assessing the alignment of the issuers’ ESG-related strategies with the bond’s objectives and use of proceeds, key performance indicators(KPIs), and the evidence of significant positive impact of the activities compared to “business as usual”. We continuously screen for “red flags” and controversies
through this process and also assess the degree of reporting by the issuer to analyze misalignment with key market standards, such as the Green Bond
Principles. These factors result in a proprietary ESG bond score ranging from 1 to 5 (with 5 being the highest). PIMCO does not score all ESG bonds. Unassessed
ESG bonds receive a default score of 3. ESG bonds holdings in PIMCO portfolios are then assigned a score that combines the issuer’s ESG score and the ESG
bond score. Specifically, an ESG bond holding receives the ESG issuer score plus an adjustment ranging from 0 up to 1.0 point, depending on the type of ESG
bond (use of proceeds or sustainability-linked) and the quality of the ESG bond according to PIMCO’s proprietary assessment. Holdings of securitized ESG
bond issuances (asset-backed securities, collateralized loan obligations, collateralized mortgage obligations, collateralized debt obligations, and mortgage passthrough securities) receive the ESG issuer score and are not adjusted.
We use MSCI and other third-party ratings for reference but make our own assessment based on our own, independent analysis of the industry and relevant ESG factors.
PIMCO’s resulting assessments are proprietary and distinct from those provided by ESG rating providers. Inclusion of a proprietary PIMCO ESG rating creates a conflictof interest because PIMCO and its affiliates benefit when PIMCO assigns a particular security a high score, or assigns a benchmark index or security a low score.
All investments contain risk and may lose value. Investing in the bond market is subject to risks, including market, interest rate, issuer, credit, inflation risk, andliquidity risk. The value of most bonds and bond strategies are impacted by changes in interest rates. Bonds and bond strategies with longer durations tend to
be more sensitive and volatile than those with shorter durations; bond prices generally fall as interest rates rise, and low interest rate environments increase thisrisk. Reductions in bond counterparty capacity may contribute to decreased market liquidity and increased price volatility. Bond investments may be worth moreor less than the original cost when redeemed.

pimco.com

PBEQS_3637996

CMR2023-0823-3078256

With respect to comingled funds with sustainability objectives (“ESG-dedicated funds”), please see each ESG-dedicated fund’s prospectus for more detailed
information related to its investment objectives, investment strategies and approach to ESG.
This material contains the current opinions of the manager and such opinions are subject to change without notice. This material is distributed for informational
purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information
contained herein has been obtained from sources believed to be reliable, but not guaranteed.
PIMCO as a general matter provides services to qualified institutions, financial intermediaries and institutional investors. Individual investors should contact theirown financial professional to determine the most appropriate investment options for their financial situation. This is not an offer to any person in any jurisdiction
where unlawful or unauthorized. | Pacific Investment Management Company LLC, 650 Newport Center Drive, Newport Beach, CA 92660 is regulated by theUnited States Securities and Exchange Commission. | PIMCO Europe Ltd (Company No. 2604517, 11 Baker Street, London W1U 3AH, United Kingdom) is
authorised and regulated by the Financial Conduct Authority (FCA) (12 Endeavour Square, London E20 1JN) in the UK. The services provided by PIMCO Europe
Ltd are not available to retail investors, who should not rely on this communication but contact their financial adviser. | PIMCO Europe GmbH (Company No.
192083, Seidlstr. 24-24a, 80335 Munich, Germany), PIMCO Europe GmbH Italian Branch (Company No. 10005170963, Corso Vittorio Emanuele II, 37/
Piano 5, 20122 Milano, Italy), PIMCO Europe GmbH Irish Branch (Company No. 909462, 57B Harcourt Street Dublin D02 F721, Ireland), PIMCO EuropeGmbH UK Branch (Company No. FC037712, 11 Baker Street, London W1U 3AH, UK), PIMCO Europe GmbH Spanish Branch (N.I.F. W2765338E, Paseo dela Castellana 43, Oficina 05-111, 28046 Madrid, Spain) and PIMCO Europe GmbH French Branch (Company No. 918745621 R.C.S. Paris, 50–52 Boulevard
Haussmann, 75009 Paris, France) are authorised and regulated by the German Federal Financial Supervisory Authority (BaFin) (Marie- Curie-Str. 24-28, 60439
Frankfurt am Main) in Germany in accordance with Section 15 of the German Securities Institutions Act (WpIG). The Italian Branch, Irish Branch, UK Branch,
Spanish Branch and French Branch are additionally supervised by: (1) Italian Branch: the Commissione Nazionale per le Società e la Borsa (CONSOB) (Giovanni
Battista Martini, 3 - 00198 Rome) in accordance with Article 27 of the Italian Consolidated Financial Act; (2) Irish Branch: the Central Bank of Ireland (New
Wapping Street, North Wall Quay, Dublin 1 D01 F7X3) in accordance with Regulation 43 of the European Union (Markets in Financial Instruments) Regulations
2017, as amended; (3) UK Branch: the Financial Conduct Authority (FCA) (12 Endeavour Square, London E20 1JN); (4) Spanish Branch: the Comisión Nacionaldel Mercado de Valores (CNMV) (Edison, 4, 28006 Madrid) in accordance with obligations stipulated in articles 168 and 203 to 224, as well as obligations
contained in Tile V, Section I of the Law on the Securities Market (LSM) and in articles 111, 114 and 117 of Royal Decree 217/2008, respectively and (5) French
Branch: ACPR/Banque de France (4 Place de Budapest, CS 92459, 75436 Paris Cedex 09) in accordance with Art. 35 of Directive 2014/65/EU on markets infinancial instruments and under the surveillance of ACPR and AMF. The services provided by PIMCO Europe GmbH are available only to professional clients as
defined in Section 67 para. 2 German Securities Trading Act (WpHG). They are not available to individual investors, who should not rely on this communication.
| PIMCO (Schweiz) GmbH (registered in Switzerland, Company No. CH-020.4.038.582-2, Brandschenkestrasse 41 Zurich 8002, Switzerland). The services
provided by PIMCO (Schweiz) GmbH are not available to retail investors, who should not rely on this communication but contact their financial adviser. | PIMCO
Asia Pte Ltd (Registration No. 199804652K) is regulated by the Monetary Authority of Singapore as a holder of a capital markets services licence and an
exempt financial adviser. The asset management services and investment products are not available to persons where provision of such services and products
is unauthorised. | PIMCO Asia Limited is licensed by the Securities and Futures Commission for Types 1, 4 and 9 regulated activities under the Securities andFutures Ordinance. PIMCO Asia Limited is registered as a cross-border discretionary investment manager with the Financial Supervisory Commission of Korea(Registration No. 08-02-307). The asset management services and investment products are not available to persons where provision of such services andproducts is unauthorised. | PIMCO Investment Management (Shanghai) Limited. Office address: Suite 7204, Shanghai Tower, 479 Lujiazui Ring Road, Pudong,Shanghai 200120, China (Unified social credit code: 91310115MA1K41MU72) is registered with Asset Management Association of China as Private Fund Manager(Registration No. P1071502, Type: Other). | PIMCO Australia Pty Ltd ABN 54 084 280 508, AFSL 246862. This publication has been prepared without taking
into account the objectives, financial situation or needs of investors. Before making an investment decision, investors should obtain professional advice andconsider whether the information contained herein is appropriate having regard to their objectives, financial situation and needs. | PIMCO Japan Ltd, Financial
Instruments Business Registration Number is Director of Kanto Local Finance Bureau (Financial Instruments Firm) No. 382. PIMCO Japan Ltd is a member ofJapan Investment Advisers Association, The Investment Trusts Association, Japan and Type II Financial Instruments Firms Association. All investments containrisk. There is no guarantee that the principal amount of the investment will be preserved, or that a certain return will be realized; the investment could suffer aloss. All profits and losses incur to the investor. The amounts, maximum amounts and calculation methodologies of each type of fee and expense and their total
amounts will vary depending on the investment strategy, the status of investment performance, period of management and outstanding balance of assets andthus such fees and expenses cannot be set forth herein. | PIMCO Taiwan Limited is an independently operated and managed company. The reference numberof business license of the company approved by the competent authority is (112) Jin Guan Tou Gu Xin Zi No. 015. The registered address of the company is 40F.,
No.68, Sec. 5, Zhongxiao East Rd., Xinyi District, Taipei City 110, Taiwan (R.O.C.), and the telephone number is +886 2 8729-5500. | No part of this publication may
be reproduced in any form, or referred to in any other publication, without express written permission. PIMCO is a trademark of Allianz Asset Management ofAmerica LLC in the United States and throughout the world. ©2023, PIMCO.