ENGAGING WITH ISSUERS
As an active, bottom-up, fixed income asset manager, PGIM Fixed Income views ESG engagement as animportant tool in our investment process. Through constructive and ongoing dialogue with issuers, we
believe that ESG engagements can enable us to achieve better investment and, where applicable, ESG
outcomes for our clients.

FOCUS
Our ESG engagement efforts are rooted in our fiduciary duty towards our clients. As such, our ESG
engagements focus on issuers where we believe that an engagement will be additive to our investment
process. The objective of our engagements will be specific to each issuer and focused on issues that arematerial to the issuer from an ESG credit risk/opportunities and/or ESG impact perspective.
A core tenet of our engagement philosophy is that we should not pursue engagements that are likely toharm the value of our clients’ positions in the issuer. While we cannot know with certainty what the effectof an engagement will be in advance, we prioritise engagements and objectives that our analysts believe(based on their knowledge of the issuer and its industry) will preserve or improve the value of ourpositions in the issuer and avoid those that they believe will conflict with this intention.
Our engagements are focussed on issuers of debt and include listed and unlisted companies as well as
securitised products, municipals, and sovereigns.

PRIORITISATIONAs one of the world’s largest fixed income managers, investing in several thousand issuers across mostindustries and asset classes, our engagements with issuers are prioritised on the basis of factors such as
the materiality of the ESG topic(s) on the issuer, our relative value view of the issuer, and how receptive
we view the issuer to be to engagement.
Additionally, we may consider other factors that aid in our prioritisation, such as specific themes,
controversies, specific events including change to regulation, M&A, or other issues that may arise.

PGIM FIXED INCOME ESG ENGAGEMENT POLICYAPPROACH
Our approach to engagement is rooted in constructive dialogue with our issuers, collaboration internally
between fundamental research analysts, economists and ESG specialists, and quality engagements overquantity.
Given that our engagement activities are directly linked to our investment research and decisions, ourstrong preference is for one-on-one direct engagements as this allows us to represent our own viewpointand enables us to speak candidly when highlighting our ESG concerns to company management,
policymakers, arranging banks, sponsors, NGOs or any other stakeholder. We do not employ third
parties to conduct engagements.
We believe constructive dialogue should be informative and meaningful for both parties. This means thatwhile dialogue will often entail our analysts probing management on the relevant, material ESG issues andassessing the issuer's plans to address them, we also believe in sharing information such as pointing out toissuers our assessment of credit material ESG risks as well as the impacts that their policies, practices or
products have on the environment and society. Where applicable, we discuss the implications these
considerations may have for their funding costs and future market demand for any new issuance ofbonds.
To enable this constructive ESG dialogue, we encourage close collaboration between our team offundamental research analysts, economists and ESG specialists throughout the engagement process. Suchcollaboration allows for knowledge sharing between teams and enables us to think holistically of the ESG
objectives and risk-return implications of an engagement. Given that we see ESG engagements as a partof our investment process, we see great value in this collaboration across teams.
As we believe that engagements should be highly relevant to our investment process and also provide
valuable insights to the issuers we engage with, our approach to engagements emphasizes quality overquantity. This means that our focus is on fewer but more substantive engagements, where the objective iscentered on one or two in-depth questions or recommendations.
Through in-depth and nuanced discussions on our ESG concerns, we may make issuers aware of how
our concerns factor into our investment decision, gain a better understanding of what the issuer is doing
to address our concerns, and discuss industry best practices. Such dialogues are likely to enrich ourinvestment analysis while at the same time provide useful insights to issuers into how they compare toindustry peers and how markets perceive their ESG initiatives. Our ESG Impact Ratings offer additional
tangibility and context to the conversations, as they allow our analysts to show issuers how we rate themon ESG impacts, while also providing the rationale and factors behind the ratings.
We believe that by asking informed questions, raising our concerns and sharing industry best practice, we
can positively influence issuer ESG practices over the long-term. While we find that it is usually difficult
to attribute changes made by an issuer to a single investor or engagement, we believe that issuers hearing
the same concerns from multiple investors on the same ESG points can lead to change and contribute tolong-term value creation. As a result, we believe that it is our responsibility to contribute to such dialogue,even if we may not be able to claim full credit for the outcomes.
Once a meaningful engagement has taken place, an assessment of the engagement is recorded internally.
These recordings facilitate monitoring of our ESG-related interactions with issuers, provide helpful
insights to our investment process and are used to inform clients of our ESG engagement efforts. We
then track the issuer’s progress on the ESG issues we raise and reflect this in our ESG Impact Ratings

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and fundamental credit ratings (where ESG risks are integrated), both of which must be updated at least
annually, or more frequently as events warrant.

ESCALATION
When an issuer is not addressing its most material ESG concerns, regardless of whether we determine
this through engagement or our research, we believe that the most effective method of escalation is to
reduce our holdings of the issuer’s debt with the expectation that this will, over time, impact the issuer’s
cost of capital.
Given that we generally do not have equity ownership rights, we are not able to use proxy voting, which
is one of the primary escalation mechanisms available to equity holders. As a leading fixed income asset
manager, we do, however, still have effective mechanisms available to us. Unlike equity, debt matures,
requiring issuers to raise new debt regularly. As a result, our decision to invest in an issuer can affect its
cost of capital in a way an equity investor cannot. To this end, our divestment in the secondary market
may contribute to widening an issuer’s market spreads, which in turn can also impact the future cost ofcapital, when the issuer comes back to market with a new issue. Even if we do not currently hold anissuer, our views, as one of the largest global active fixed income managers, can be impactful if the issuer
intends to issue future debt. On the back of these considerations, we see our decision to buy, divest or
not invest as our most effective instrument of escalation, especially if it is done in combination with direct
feedback to the issuer regarding our investment decision.
The primary example of this is with respect to our ESG Impact Ratings. Investments in our ESG
strategies are informed and guided by our ESG Impact Ratings. Our research analysts assign issuers under
their coverage an ESG Impact Rating, which assesses the issuer’s impact on the environment and society.
Should our analysts conclude that the issuer isn’t adequately addressing its most material impacts or
making progress the way it was expected to, the analyst would generally downgrade the ESG Impact
Rating. These downgrades are meaningful because, depending on the resulting ESG Impact Rating, it can
trigger us to reduce or even exit the position in our ESG strategies. It should be noted, though, that evenif we divest an issuer, we may continue to engage with them as they continue to issue new debt.

ENGAGEMENT WITH POLICYMAKERS
AND REGULATORSAs a large, global asset manager, PGIM Fixed Income is affected by regulation in many jurisdictions, bothwhere this applies to issuers and investors. And in recent years, there has been rapid growth in regulationworldwide that is specifically ESG-related. Where proposals for such regulation are particularly relevant
to PGIM Fixed Income, we actively engage with policymakers, either directly or via collaboration withother PGIM businesses at the PGIM level (and, at times, via our trade association partners). This ismostly achieved through responses to open regulatory consultations, such as the SEC’s proposals on
climate disclosures and ESG fund disclosures. It may also involve consultations with standard setters,such as on the ISSB’s proposed sustainability disclosure standards. We also engage with policymakers on
proposals that may negatively impact our investments to make sure they understand the implications of
their actions on both the economy and our investors.

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ENGAGEMENT WITH INDUSTRY
ORGANISATIONS
We are a member of a number of trade associations and industry initiatives and are committed toproviding feedback to policy consultations or technical input into regulatory process that materially
impact us or our investments. The selected list of our current memberships and collaborative initiatives
related to ESG topics is below:
Directly as PGIM Fixed Income
1. Signatory to the UN Principles for Responsible Investment (UN PRI) (Securitised Products Advisory
Committee)
2. Signatory to the Financial Reporting Council’s UK Stewardship Code
3. Partnership for Carbon Accounting Financials (PCAF)
4. Climate Bonds Initiative
5. Center for Real Estate Finance Council (CREFC) (Sustainability Steering Committee, Transparency
Subcommittee)
6. European Leveraged Finance Association (ELFA) (ESG Committee)
7. Structured Finance Association (SFA) (Auto ABS Working Group, CMBS Working Group, ESG Task
Force Steering Committee, Structured Finance Disclosure Framework Working Group)
8. Loan Syndications and Trading Association (LSTA)
9. Association for Financial Markets in Europe (AFME)
10. Loan Market Association (LMA)
Indirectly via PGIM, Inc
1. Ceres Investor Network
2. International Financial Reporting Standards (IFRS) Sustainability Alliance3. The Council of Institutional Investors (CII)
4. The Institutional Investors Group on Climate Change (IIGCC)

PGIM FIXED INCOME ESG ENGAGEMENT POLICY4

NOTICE: IMPORTANT INFORMATION
Source(s) of data (unless otherwise noted): PGIM Fixed Income, as of 5 July 2024.
For Professional Investors only. Past performance is not a guarantee or a reliable indicator of future results and an
investment could lose value. All investments involve risk, including the possible loss of capital.
PGIM Fixed Income operates primarily through PGIM, Inc., a registered investment adviser under the U.S. Investment
Advisers Act of 1940, as amended, and a Prudential Financial, Inc. (“PFI”) company. Registration as a registered investment
adviser does not imply a certain level or skill or training. PGIM Fixed Income is headquartered in Newark, New Jersey andalso includes the following businesses globally: (i) the public fixed income unit within PGIM Limited, located in London; (ii)
PGIM Netherlands B.V., located in Amsterdam; (iii) PGIM Japan Co., Ltd. (“PGIM Japan”), located in Tokyo; (iv) the public
fixed income unit within PGIM (Hong Kong) Ltd. located in Hong Kong; and (v) the public fixed income unit within PGIM(Singapore) Pte. Ltd., located in Singapore (“PGIM Singapore”). PFI of the United States is not affiliated in any manner withPrudential plc, incorporated in the United Kingdom or with Prudential Assurance Company, a subsidiary of M&G plc,
incorporated in the United Kingdom. Prudential, PGIM, their respective logos, and the Rock symbol are service marks of PFI
and its related entities, registered in many jurisdictions worldwide.
These materials are for informational or educational purposes only. The information is not intended as investment advice andis not a recommendation about managing or investing assets. In providing these materials, PGIM is not acting as yourfiduciary. PGIM Fixed Income as a general matter provides services to qualified institutions, financial intermediaries andinstitutional investors. Investors seeking information regarding their particular investment needs should contact their own
financial professional.
These materials represent the views and opinions of the author(s) regarding the economic conditions, asset classes,
securities, issuers or financial instruments referenced herein. Distribution of this information to any person other than the
person to whom it was originally delivered and to such person’s advisers is unauthorized, and any reproduction of thesematerials, in whole or in part, or the divulgence of any of the contents hereof, without prior consent of PGIM Fixed Income isprohibited. Certain information contained herein has been obtained from sources that PGIM Fixed Income believes to bereliable as of the date presented; however, PGIM Fixed Income cannot guarantee the accuracy of such information, assure its
completeness, or warrant such information will not be changed. The information contained herein is current as of the date ofissuance (or such earlier date as referenced herein) and is subject to change without notice. PGIM Fixed Income has no
obligation to update any or all of such information; nor do we make any express or implied warranties or representations as tothe completeness or accuracy.
This material may contain examples of the firm’s internal ESG research program and is not intended to represent any
particular product’s or strategy’s performance or how any particular product or strategy will be invested or allocated at any
particular time. PGIM’s ESG policies and procedures, rankings and factors may change over time, in PGIM Fixed Income’s
discretion. ESG investing is qualitative and subjective by nature; there is no guarantee that the criteria used or judgment
exercised by PGIM Fixed Income will reflect the beliefs or values of any investor. Information regarding certain ESG practices
may be obtained through third-party reporting, which may not be accurate or complete, and PGIM Fixed Income depends on
this information to evaluate a company’s commitment to, or implementation of, ESG practices. ESG norms differ by region.
Accounts managed by PGIM Fixed Income may or may not hold instruments issued by any of the issuers that may be
discussed herein. Nothing contained herein should be construed as limiting the investments or strategies that PGIM Fixed
Income can pursue when managing a client account. There is no assurance that PGIM Fixed Income’s ESG investing
techniques will be successful.
Any forecasts, estimates and certain information contained herein are based upon proprietary research and should not beinterpreted as investment advice, as an offer or solicitation, nor as the purchase or sale of any financial instrument. Forecasts
and estimates have certain inherent limitations, and unlike an actual performance record, do not reflect actual trading, liquidity
constraints, fee. These materials are not intended as an offer or solicitation with respect to the purchase or sale of any security
or other financial instrument or any investment management services and should not be used as the basis for any investment
decision. PGIM Fixed Income and its affiliates may make investment decisions that are inconsistent with therecommendations or views expressed herein, including for proprietary accounts of PGIM Fixed Income or its affiliates.

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Investing in the bond market is subject to risks, including market, interest rate, issuer, credit, inflation risk, and liquidity risk.
The value of most bonds and bond strategies are impacted by changes in interest rates. Bonds and bond strategies withlonger 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 this risk. Reductions in bond counterparty capacity may contribute to
decreased market liquidity and increased price volatility. Bond investments may be worth more or less than the original costwhen redeemed. Mortgage- and asset-backed securities may be sensitive to changes in interest rates, subject to early
repayment risk, and while generally supported by a government, government agency or private guarantor, there is no
assurance that the guarantor will meet its obligations. High yield, lower-rated securities involve greater risk than higherrated securities; portfolios that invest in them may be subject to greater levels of credit and liquidity risk than portfolios that donot. Investing in foreign-denominated and/or -domiciled securities may involve heightened risk due to currency
fluctuations, and economic and political risks, which may be enhanced in emerging markets. Currency rates may fluctuatesignificantly over short periods of time and may reduce the returns of a portfolio. Commodities contain heightened risk,
including market, political, regulatory and natural conditions, and may not be suitable for all investors. Diversification does
not ensure against loss.
In the United Kingdom, information is issued by PGIM Limited with registered office: Grand Buildings, 1-3 Strand, Trafalgar
Square, London, WC2N 5HR.PGIM Limited is authorised and regulated by the Financial Conduct Authority (“FCA”) of theUnited Kingdom (Firm Reference Number 193418). In the European Economic Area (“EEA”), information is issued by PGIM
Netherlands B.V., an entity authorised by the Autoriteit Financiële Markten (“AFM”) in the Netherlands and operating on thebasis of a European passport. In certain EEA countries, information is, where permitted, presented by PGIM Limited inreliance of provisions, exemptions or licenses available to PGIM Limited including those available under temporary permission
arrangements following the exit of the United Kingdom from the European Union. These materials are issued by PGIM Limited
and/or PGIM Netherlands B.V. to persons who are professional clients as defined under the rules of the FCA and/or topersons who are professional clients as defined in the relevant local implementation of Directive 2014/65/EU (MiFID II). In
Switzerland, information is issued by PGIM Limited, London, through its Representative Office in Zurich with registered office:Kappelergasse 14, CH-8001 Zurich, Switzerland. PGIM Limited, London, Representative Office in Zurich is authorised andregulated by the Swiss Financial Market Supervisory Authority FINMA and these materials are issued to persons who areprofessional or institutional clients within the meaning of Art.4 para 3 and 4 FinSA in Switzerland. In certain countries in AsiaPacific, information is presented by PGIM (Singapore) Pte. Ltd., a regulated entity with the Monetary Authority of Singapore
under a Capital Markets Services License to conduct fund management and an exempt financial adviser. In Japan,
information is presented by PGIM Japan Co. Ltd., registered investment adviser with the Japanese Financial Services
Agency. In South Korea, information is presented by PGIM, Inc., which is licensed to provide discretionary investment
management services directly to South Korean investors. In Hong Kong, information is provided by PGIM (Hong Kong)
Limited, a regulated entity with the Securities & Futures Commission in Hong Kong to professional investors as defined in
Section 1 of Part 1 of Schedule 1 of the Securities and Futures Ordinance (Cap.571). In Australia, information is issued by
PGIM (Australia) Pty Ltd (“PGIM Australia”) for the general information of its wholesale clients (as defined in the Corporations
Act 2001). PGIM Australia is an Australian financial services ("AFS") licence holder (AFS licence number 544946). In Canada,pursuant to the international adviser registration exemption in National Instrument 31-103, PGIM, Inc. is informing you that: (1)
PGIM, Inc. is not registered in Canada and is advising you in reliance upon an exemption from the adviser registration
requirement under National Instrument 31-103; (2) PGIM, Inc.’s jurisdiction of residence is New Jersey, U.S.A.; (3) there may
be difficulty enforcing legal rights against PGIM, Inc. because it is resident outside of Canada and all or substantially all of its
assets may be situated outside of Canada; and (4) the name and address of the agent for service of process of PGIM, Inc. in
the applicable Provinces of Canada are as follows: in Québec: Borden Ladner Gervais LLP, 1000 de La Gauchetière Street
West, Suite 900 Montréal, QC H3B 5H4; in British Columbia: Borden Ladner Gervais LLP, 1200 Waterfront Centre, 200
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Box 2380 -Stn Central RPO, Halifax, NS B3J 3E5; in Alberta: Borden Ladner Gervais LLP, 530 Third Avenue S.W., Calgary,
AB T2P R3.
© 2024 PFI and its related entities. 2024-5457

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