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Frequently Asked Questions
 
About SRI
1. What does ‘SRI’ mean?

SRI means Socially Responsible Investment. It gives an investor the opportunity to align his/her social and environmental beliefs with his/her investment goals.
2. Is there a contradiction in terms of personal beliefs not portrayed in actual actions if someone invests in a non-SRI way?

Yes, there would be a contradiction. The layman will not think of harming another person, and yet, by being passive in his/her investment decisions (passive by ignoring the subject of SRI investing), he/she could end up owning shares (and thereby financing the activities of) in for example, a company producing land mines. The same logic can be applied for child labour, for tobacco-induced illnesses, and so on. The layman would not make children work, and yet investing in a non-SRI way is what one could (indirectly) make children do.
3. Are some industries better then others in SRI terms?

Yes, some industries, by nature of the business that they are in, are better in SRI terms. The Fund selects the best companies from each different industrial sector (although some industrial sectors are entirely avoided). This is the ‘best in class’ concept’.
4. Are there some industrial sectors that are avoided?

The following industrial sectors are avoided (in these cases where it constitutes 10% or more of a corporation’s total turnover): tobacco, alcohol, armaments, genetic engineering, production of nuclear power and gambling. This is what is often referred to as “negative screens”.
5. What are ‘negative screens’?

Negative screens refer to those industry sectors that are avoided by the Fund. The following industrial sectors are avoided (in these cases where it constitutes 10% or more of a corporation’s total turnover): tobacco, alcohol, armaments, genetic engineering, production of nuclear power and gambling.
6. What is the financial objective of the Fund?

The financial objective of the Fund is long term capital growth.
7. How does the Fund trade off financial gains against SRI goals?

There is no trade off. Any company that the Fund invests in must first comply with all of the Fund’s stringent financial analyses.
8. Why does the Sub-Fund of the Fund Living Planet Fund – Equity invest in automobiles?

The Fund has an umbrella structure, whereby under the umbrella, different Sub-Funds (also called compartments) are formed. The Sub-Fund called Living Planet Fund – Equity is the first one created. It includes the automobile sector in its portfolio, this being a conscious choice for this first Sub-Fund. It is envisaged that one of the future Sub-Funds will exclude (for example) automobiles, the idea being that the investor would then have a range of SRI choices to pick from depending on his/her own concerns about SRI matters.
9. Why is the fund not measured against an SRI index?

Intentionally, we chose not to use an SRI index as we want to show to non-SRI investors that one can invest in SRI, and have performance comparable to that of any non-SRI investment. As financial returns are comparable, the SRI component becomes an added benefit at no extra-cost.
Definitions
1. What is an “umbrella structure”?

The Fund has an umbrella structure, under which different Sub-Funds (also called compartments) are formed. The first Sub-Fund is called the Living Planet Fund – Equity.
2. What is meant by “leaders”?

Leaders are those companies that are the best examples of companies operating in a particular industry. It is those companies that are considered as offering the best financial, environmental and/or social performance. They are typically multi-national corporations with large market capitalisations. Leaders typically have a market capitalisation worth billions of U.S. dollars. They are constantly monitored and classified on a sector by sector basis. The companies in these sectors are considered to have strong economic potential and services or products with exceptional capabilities to reduce environmental/social impacts.
3. What is meant by “innovators”?

Innovators are mostly smaller and younger companies whose products and services offer proven environmental benefits and high resource efficiency. They need to have a minimum market capitalisation of between USD 100 million and USD 2 billion. Innovators are constantly monitored and classified on a sector by sector basis. The companies in these sectors are considered to have strong economic potential and services or products with exceptional capabilities to reduce environmental/social impacts.
4. What is meant a benchmark?

A benchmark is the yardstick against which the Fund’s performance is compared. In some years the Fund’s performance exceed the benchmark, and in other years the Fund’s performance may not exceed the benchmark. Benchmarks used are typically ‘indices’ an example being the Morgan Stanley Capital Index – Global Equities.
5. What are global Equities?

Equities refer to the shares of companies, and global means world wide. Therefore, global equities are shares of companies from different countries around the world.
6. What is a ‘FCP’?

For the European Union (represented by Luxembourg in the case of the Living Planet Fund) there are two legal entities available for creating an investment fund. One is called a FCP, a “Fonds Commun de Placement” in French, which means literally a common investment fund. The other form is called a SICAV, a “Société d’Investissement à Capital Variable” in French. It is a type of open-ended investment fund in which the amount of capital in the fund varies according to the number of investors. Shares in the fund are bought and sold based on the fund's current net asset value. For the investors, whichever is the structure of such entity, FCP or SICAV, it makes absolutely no difference.
7. What is a UCITs?

UCITs means “Undertakings for Collective Investments in Transferable Securities”. The UCITSs legislation governs how a fund can be marketed with the European Union and is designed to allow cross border fund sales to investors of different nationalities. FCP and SICAV are both UCITs. To obtain UCITS status a fund must invest within defined but wide parameters. The fund may then be sold in any EU country, subject only to the marketing rules of that country.
8. What is UCITS III?

UCITS III are the latest (‘latest’ as of April 2006) European Union rules for investment Funds and management Companies that manage investment funds operating in the European Union.
9. What is meant by ‘an individual investing’?

An individual is a physical person.
10. What is meant by ‘an institution investing’?

An institution is a legal entity, typically a bank, a pension fund, an insurance company or an asset management company.
11. What is the ‘ISIN’?

The ISIN is the International Identification Number, which allows any bank, stockbroker, or any individual or financial institution to precisely identify a particular security.
12. What is Bloomberg ?

Bloomberg L.P. is a financial news service founded by Michael Bloomberg in 1982. It provides financial news and data to financial companies and organizations in virtually every country in the world through the Bloomberg Terminal, its core money-generating product. Bloomberg L.P. has grown to include a global news service, including television, radio, the Internet and publications.
13. What is Telekurs?

Telekurs is an international data provider for real time quotes, corporate actions and business news.
Structure Of The Fund
1. What is a “Sub-Fund”?

The Fund has an umbrella structure, under which different Sub-Funds (also called compartments) are formed. The first Sub-Fund is called the Living Planet Fund – Equity.
2. What does the Sub-Fund Living Planet Fund – Equity invest in?

The Sub-Fund Living Planet Fund – Equity invests in global equities. There is a mixture of “leaders” and “innovators” in the portfolio.
3. What is the benchmark against which the Fund is measured?

The Fund is measured against the MSCI World Equity index. MSCI stands for Morgan Stanley Capital International.
4. What about global fixed income?

The Sub-Fund Living Planet Fund – Equity is the first Sub-Fund. It is envisaged that a Global Fixed Income Sub-Fund will next be constituted.
5. What about “Energy”?

The Sub-Fund Living Planet Fund – Equity is the first Sub-Fund. It is envisaged that a Energy Sub-Fund will later be constituted.
6. What about “Water”?

The Sub-Fund Living Planet Fund – Equity is the first Sub-Fund. It is envisaged that a Water Sub-Fund will later be constituted.
Investment Policy Of The Fund
1. What is WWF’s role in the investment process?

WWF determines the investment policies for the asset managers of the Fund to adopt.
This includes:
  1. The definition of business activities* to be excluded, respectively:
    • Production of armaments and other military products
    • Production and processing of tobacco
    • Production of alcohol
    • Gambling
    • Production of nuclear power
    • Genetic engineering

    Where the revenues from these activities exceed 10% of consolidated revenues.

    Within each category, there are reasons why the exclusion is there. For more information, click here.

  2. The definition of the “Best in class” approach. Some industries, by nature of the business that they are in, are better in SRI terms. The Fund, selects the best companies from each different industrial sector (although some industrial sectors are entirely avoided). The “best in class” concept means that only the best performers by sector over time will be considered for inclusion in the Sub-Fund.

  3. The definition of indicators, which are divided up into categories as follows:
    • Environmental Policy
    • Production Processes
    • Social Indicators
    • Certifications and codes

    Companies considered for inclusion in the Sub-Fund will be measured against the various constituents of each of the above indicators. For more information on each category of investment indicator, click here.

    The portfolio managers will assess the integration of environmental and social criteria into management and production processes. They may, at their expense, engage independent external advisors to evaluate companies.

  4. In addition to the above, the investment managers have investment mandates that provides further information to guides them.

  5. Finally, the investment managers are in regular contact with the appropriate WWF units to ensure the best co-ordination. This includes periodic meetings with the WWF International’s Finance department and the Business and Industry unit as well as in depth discussions on thematic topics (such as marine, energy, etc.)

2. What is meant by assessing a company against “social criteria” before the Fund invests?

Before the Fund invests, and after a company has FIRST passed the financial criteria, the Fund assesses a company against social indicators, such as:
  • Publicly available policy on social standards
  • Equal employment opportunity
  • Community involvement
  • Proper relationship with labour, suppliers and other stakeholders
3. What is meant by assessing a company against “environmental criteria” before the Fund invests?

Before the Fund invests, and after a company has passed the financial criteria, the Fund assesses a company against environmental indicators, such as:
  • Environmental policy
  • Compliance with environmental legislation
  • Published environmental impact statements
  • EMS (Environmental Management System)
4. What is meant by assessing a company against “ethical criteria” before the Fund invests?

Before the Fund invests, and after a company has passed the financial criteria, the Fund assesses a company against ethical indicators, such as:

Production Processes

Assessment of production processes and product life cycles, taking into account:
  • recycling
  • waste minimisation
  • renewable energy
  • energy efficiency
  • water management
  • emissions of greenhouse gases
  • reduction/elimination of POPs (Persistent Organic Pollutants) and EDCs (Endocrine Dis-rupting Chemicals)
Certifications and Codes

External certification to Standards such as:
  • ISO 14001
  • FSC (Forest Stewardship Council)
  • MSC (Marine Stewardship Council)
  • ILO (International Labour Organisation)
5. Is there a balance between the four indicators, does one prevails upon another?

There is no balance between the four indicators. Security should comply with the four indicators, of course possibly complying with a higher extent. An example would be a timber company complying very well with FSC standards (Forest Stewardship Council) under the certification category and also with EMS (Environmental Management System) as described under the Environmental Policy category, but that is employing children in Indonesia. This company will never enter the Fund’s portfolio.
6. How these investment policies work together?

The defined investment policies are cumulative; there is no case of using one policy rather then the other. Therefore:
  • A tobacco company comes under the tobacco exclusion, and therefore will not be in the selected investment universe. In this example, exclusion, all companies that fall within the exclusion industry will not be in the investment universe.


  • A sports good manufacturing company that falls within the category of indicators will be in the selected investment universe. However, a sport goods manufacturing company that does not (for example if the company had bad social and labour policies) fall within the category of indicators will not be in the selected investment universe. In this example, companies within this industry are selected or not depending on their compliance with the 4 categories of indicators.


  • Where companies are deemed appropriate for the selection universe, they are then reviewed to ensure that they are financially interesting as investments. After that, the best companies in each category of industry (“best in class”) are selected.
The Management Policy
1. Which is the management company that manages the Fund?

The Living Planet Fund Management Company is the legal entity that provides overall strategy and management for the Fund. Whilst the Company provides overall strategy and management, practical day to day duties such as asset management and custodial bank responsibilities are performed by various appointed world class service providers. Where necessary, the Company will change service providers, but this is not normally planned.
2. Why are there two asset managers?

UBS Global Asset Management, and Sarasin Bank, have been appointed in order that the Fund will benefit from the following:

  • Increased diversification, as with two managers, the stock selection is spread wider, since both asset managers select stocks
  • Increased competition for each asset manager as each manager will be measured against the other, in addition to being measured against the benchmark
3. Why did we choose UBS Global Asset Management and Bank Sarasin as asset managers?

Both of these asset managers have a reputation as being good asset managers in the financial sense, AND in the sense of having experience in socially responsible investments. Both of these managers have financial analyses teams, AND socially responsible analyses teams.

UBS Global Asset Management which operates through branches and subsidiaries of UBS AG in Switzerland and worldwide, has over 3,000 employees and a presence in 20 countries.

Founded as a trading company in 1841, Bank Sarasin is today one of Switzerland’s most reputable private banking institution. With over 1,000 employees in different countries, the Sarasin Group is a leading player in sustainable investments.
Technical Information
1. How many classes of units are there?

The Fund has two different classes of units: class A units and class B units.
2. What is the difference between class A and class B units?

Class A units are for the retail investor. This refers to individuals, or to moral entities (companies, etc) that buy small (less then 500,000 euro) amounts.

Class B units are for institutions and have a minimum investment of 500,000 euro.
3. The Fund’s units are denominated in which currency?

The Fund’s units are denominated Euros.
4. What is meant by “denominated in”?

It means that this is the unit of account. Daily valuations each business day is valued in terms of euros.
5. Can someone invest in the Fund using a currency that is not euro?

Yes, one can invest using another currency; it just means that the non-euro currency is first converted to give euros. This is typically done by your bank or stockbroker.
6. An individual investing would normally buy which class of units of the Fund?

An individual would buy class A units. The minimum investment is 500 Euros, but investors typically invest more, unless they are investing on a regular basis. The recommended amount however is 5000 Euros.
7. An institution investing would normally buy which class of units of the Fund?

An institution would normally buy class B units. The minimum investment is 500,000 Euros.
8. Is there a minimum investment?

The minimum initial investment is for:
For class A units: 500 EUR
For class B units: 500,000 EUR
9. What is the minimum amount to invest in class A (retail units)?

The minimum investment is 500 Euros. However, it is generally not advisable to invest small amounts, unless it is part of an overall plan for regular investments/savings. This is accountable for the fact that the costs charged by your bank or stockbroker for maintaining the account would easily outweigh the benefits of holding a small amount of units. The recommended amount however is 5000 Euros.
10. Can one make regular savings?

Yes, you can make investments on a regular basis. Just send a regular buy instruction to your bank or stockbroker.
11. Is the Fund listed on a recognized stock exchange?

Yes, the Fund is listed on the Luxembourg Stock Exchange since 2004.
12. Is the Fund regulated?

Yes, the Fund is regulated by the CSSF (Commission de surveillance du Secteur Financier) in Luxembourg, representing the European Union. It fully complies with European Union rules.
13. Is the management company of the fund UCITS III compliant?

As of April 2006, the management company of the Fund is not yet UCITS III compliant, but it will be during the year.
14. Is the Fund UCITS III compliant and if so since when?

The Fund has been UCITS III compliant since 2005.
15. How often is the Fund valued and traded?

The Fund is valued and traded every business day in Luxembourg.
This means that any investor can give orders to buy or to sell, on a daily basis, so long as it is a business day.
16. By what time should my order be received?

Orders received are cumulated and are then traded the following business day. All orders must be received by 4 p.m. Luxembourg time in order to be eligible for trading the following business day. For example, if an investors’ order is received on Monday before 4 p.m., his/her trade will be booked the following business day when the net assets of the Fund are computed.
17. What happens if my order is received after 4 p.m.?

Orders received after 4 p.m. are deemed to have been received the following day. For example, an investor who sends his/her order at 5 p.m. on a Monday, will be deemed to have been received on Tuesday, and will be traded on Wednesday, the following business day.
18. Is there a fee in buying units?

Units purchased are priced at their net asset value. There may be zero initial fee, or an initial fee of up to 5% may be charged by the Fund, depending on the different factors, for instance:

  • Whether it is class A or class B units,
  • The country where the investor resides in
  • The amount invested
Separately, your bank or stockbroker may also charge fees.
19. Is there a fee in selling units?

Units sold are priced at their net asset value. The Fund charges zero redemption fees. However, your bank or stockbroker may charge fees.
20. Who are the auditors of the Fund?

The Company PricewaterhouseCoopers Luxembourg is the Fund auditor. A large well known auditing firm had been chosen on purpose, to ensure that the Fund is consistently properly audited. Accountability to the Fund’s investors is a serious matter.
21. Who are the Fund’s custodian bankers?

The custodian bank of the Fund is UBS (Luxembourg) S.A. which means that the bank holds all the liquid assets and securities belonging to the Fund, in safekeeping for the unit holders. UBS (Luxembourg) S.A. is a Luxembourg bank and is connected with UBS AG which had shareholders’ equity of 35,310 million Swiss francs as at 30th September, 2003.
22. What are the ISIN numbers of the Sub-Fund Living Planet Fund –Equity?

The ISIN numbers for Living Planet Fund – Equity are:

For Class A units: LU0169371266
For Class B units: LU0169371779
23. Can I find the Fund’s units on Bloomberg?

Yes, the reference numbers are:

For Class A units: LIVPLNALX
For Class B units: LIVPLNBLX
24. Can I find the Fund’s units on Telekurs?

Yes, the reference numbers are:

Class A units: 1611752 LPFUND EQUITY A
Class B units: 1611753 LPFUND EQUITY B
25. The Fund is currently approved for distribution and marketing by the regulatory authority of which countries?

The Fund is currently approved for marketing and distribution in Luxembourg, Germany, France and Switzerland.
26. Are there plans to add other countries to the current list of countries where the Fund is approved for marketing and distribution?

Yes, future plans will include countries in Europe and in Asia.
27. Can U.S. citizens or U.S. residents buy units of the Fund?

No, U.S. citizens and U.S. residents cannot buy units of the Fund. This exclusion, however, does not apply to sophisticated high net worth individuals nor qualified financial institutions.
28. Can someone living in a country where the Fund is not yet authorised for marketing and distribution still but units of the Fund?

Provided that you are not a U.S. citizen, nor a U.S. resident, and provided that your country laws permit, you can buy units of the Fund. Contact your bank or stockbroker, referencing the name of the sub-fund and the ISIN number.
Record Of The Fund
1. When was the Fund’s launch date?

It was 31 July 2003
2. What was the launch price?

Class A units: 100 euro
Class B units: 1000 euro
3. By how many % did the Fund increase in value during the 5 months of 2003?

In 2003, the Fund existed for 7 months, and increased by:
Class A units: 6.21%
Class B units: 6.45%
4. By how many % did the Fund increase in value in 2004?

In 2004 the Fund increased in value by:
Class A units: 3.68%
Class B units: 4.25%
5. By how many % did the Fund increase in value in 2005?

In 2005 the Fund increased in value by:
Class A units: 19.90%
Class B units: 20.53%
6. Will the Fund’s units increase in value every single year?

No there is no guarantee that the Fund units will increase in value every SINGLE year. In some years, the value could go down, as well as up.
7. Why has the Living Planet Fund – Equity such a high percentage of USA shares?

The Fund measures itself against Global Equities, and in terms of companies operating on the world wide basis, USA companies represent about half of the total. This weighting is therefore reflected in the Fund’s portfolio.
My questions are not covered by the FAQs, where do I further enquire

Send an e mail to info@livingplanetfund.com