RPIA Sustainability Report - 2023

RPIA SUSTAINABILITY REPORT 2023

OVERVIEW FIRM

30

INVESTMENT MANAGEMENT

THEMATIC PORTFOLIOS: FOSSIL FUEL EXCLUSION STRATEGIES

We have two thematic strategies, RP Broad Corporate Bond (Fossil Fuel Exclusion) and RP Broad Corporate Bond (BBB, Fossil Fuel Exclusion). Both strategies employ a negative screening approach, to meet with stated ESG-related investor objectives. In partnership with one of our institutional investors, we developed a first-of-its-kind fossil fuel excluded corporate bond strategy for investors who take an exclusionary approach to ESG. The approach is an evolution of our RP Broad Corporate Bond strategy, which has a ten-year track record of generating over 175 bps of added value above the FTSE Canada All Corporate Bond Index (gross, annualized, since inception). The RP Broad Corporate Bond (Fossil Fuel Exclusion) strategy was launched in July 2022 and takes a rules-based exclusion approach to screening fossil fuel intensive issuers out of the fund and the benchmark. As its name suggests, this strategy excludes all companies with direct involvement in or significant ownership of fossil fuel products within the Energy sector at the time of investment. We also screen for tobacco companies, issuers with cluster emissions, and those involved in controversial weapons. The strategy maintains the performance target of the “original” strategy but has a secondary objective of maintaining a lower WACI (Weighted Average Carbon Intensity) than the already- carbon reduced FTSE Canada All Corporate ex-Fossil Fuels Enhanced Bond Index. The strategy is an innovative solution through which our investors were able to achieve both reducing fossil fuel exposure and obtaining superior returns. Performance as of December 31, 2023

Strategy AUM: $169 Million

1 Mo

3 Mo

YTD

1 Yr

SI

RP BCB FFE

3.18% 2.96% 0.22%

7.86% 6.98% 0.88%

9.53% 7.95% 1.57%

9.53% 7.95% 1.57%

8.62% 5.98%

Index

Added Value 2.64% RP BCB FFE= RP Broad Corporate Bond (Fossil Fuel Exclusion). Index = FTSE Canada All Corporate Ex Fossil Fuel Enhanced Bond Index. Source: FTSE.

RP BCB FFE Weighted Average Carbon Intensity (WACI) Relative to the Index

WACI

- 10 20 30 40 50

34% Average Reduction Since Inception

Sep-22

Dec-22

Mar-23

Jun-23

Sep-23

Dec-23

Strategy

Index

As at December 31, 2023. Index = FTSE Canada All Corporate Ex Fossil Fuel Enhanced Bond Index. Source: S&P TruCost.

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