Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Sustainability Investmen Etf UBS

Propuesta de UBS en ETF´s para Inversión Socialmente Responsable / Inversión Sostenible

  • Login to see the comments

Sustainability Investmen Etf UBS

  1. 1. Sustainable Investing with ETFs Exposure to stocks and bonds of companies with high sustainability profiles UBS Asset Management UBS Exchange Traded Funds For qualified investors only November 2016
  2. 2. 1 Table of contents • The Big Picture of Sustainable Investing • Sustainable Indexed Investing • Portfolio Applications • UBS ETF - Sustainable Value Proposition • Appendix: • MSCI ESG Scope of Research • MSCI World SRI Index Breakdowns
  3. 3. The Big Picture of Sustainable Investing Section 1
  4. 4. 3 Overarching ESG framework Sustainable investing is founded on three pillars Source: European Responsible Investing Fund Survey 2015, KPMG. UBS Asset Management. For illustration purpose only. Sustainable Investing Environmental Recognize companies that focus on offering products or services that contribute to environmentally sustainable economy Social Recognize companies that support development of human capital, implement best production practices and safety principles Governance Recognize companies with strong corporate governance • Climate change • Renewable and clean energy • Low carbon • Forestry investing • Water investments • Fossil fuel exclusion • Social and community impact • Solidarity funds • Social entrepreneurship • Microfinance investing • Engagement investing • Business ethics
  5. 5. 4 Growing importance of sustainable investing Global sustainable investments reached USD 21 trillion1 $8'758 $3'740 $589 $134 $40 $13'608 $6'572 $945 $180 $53 0 2'000 4'000 6'000 8'000 10'000 12'000 14'000 16'000 Europe United States Canada Australia / New Zealand Asia Proportion of SRI assets by region (USD bn) 2014 2012 +15% CAGR +16% CAGR +26% CAGR +32% CAGR +25% CAGR Source: Global Sustainable Investment Review 2014. 1) Professionally managed assets in all the regions covered by Global Sustainable Investment Association member organizations, incl. public and private investments that consider environmental, social and governance (ESG) factors in portfolio selection and management. ESG factors aligned with GSIA.
  6. 6. 5 UBS becomes a market leader in SRI ETFs in Europe UBS ETF 29.5% BNP Paribas 10.8% Invesco 1.8% iShares 51.2% Lyxor 6.7% UBS SRI ETFs with fund volume of more than USD 1bn as of October 2016 UBS ETF 15.1% BNP Paribas 19.7% Invesco 2.5% iShares 62.7% UBS ETF 19.8% BNP Paribas 13.2% Invesco 2.9% iShares 64.2% UBS ETF 38.5% BNP Paribas 9.9%Invesco 1.1% iShares 39.1% Lyxor 0.4% Amundi 11.0% 2015 EUR 1'360mn 2012 EUR 310mn 2013 EUR 400mn 2014 EUR 798mn Source: Morningstar, UBS Asset Management. Data as of end- March 2016.
  7. 7. Sustainable Indexed Investing Section 2
  8. 8. 7 Index solutions development truly innovative Source: UBS Asset Management. For illustration purpose only. Launch of Domini 400 Social Index KLD Analytics 1990 Launch of global Dow Jones Sustainability Indexes 1999 Versatility Evolution Milestones in the history of the indexed Socially Responsible Investing MSCI acquires RiskMetrics and KLD to incorporate the ESG 2010 Launch of Calvert Social Index 2000 MSCI introduces currency hedged SRI indices 2013 Barclays and MSCI introduce a fixed income and currency hedged SRI indices 2015 Launch of FTSE4Good Series 2000 S&P Dow Jones as well as Barclays and MSCI introduce green bond indices 2014 Launch of S&P Global Water Index 2007
  9. 9. 8 UBS ETF partners up with the leading index providers Source: MSCI. UBS Asset Management. As of May 2016. 1) ESG Rating of A or higher, see Appendix I; 2) ESG rating of BBB or higher; see Appendix I MSCI ESG research is the key foundation in deriving SRI indices • MSCI has 40+ years experience based on legacy ESG firms IRRC, KLD & Innovest • One of the largest ESG providers with a global staff of over 200 supporting ESG research processes • Assets tracking the MSCI ESG index family have grown globally to USD 45bn at the end of 2015 • MSCI is a signatory to the PRI (Principles for Responsible Investment) • Broad offering for key equity as well as fixed income markets through a joint venture with Barclays Parent Index Asset Class MSIC ESG Research ESG Equity & Fixed Income Index Families UBS ETFs MSCI ACWI Barclays Global Aggregate Equity Fixed Income MSCI ESG Research EQ: 5'700 companies; FI: 9'000 issuers and 350'000 securities MSCI SRI Indexes1) MSCI Sustainability Indexes MSCI Global Norms Indexes MSCI Environmental Indexes Barclays MSCI SRI Indexes Barclays MSCI Sustainability Indexes2) Barclays MSCI ESG Weighted Indexes Barclays MSCI Green Bond Indexes MSCI World SRI MSCI USA SRI MSCI Japan SRI MSCI Pacific SRI MSCI Emerging Markets SRI MSCI EMU SRI MSCI UK IMI SRI Barclays MSCI Sustainability
  10. 10. 9 MSCI SRI index methodology Source: MSCI. UBS Asset Management. For illustration purpose. 1 See Appendix I 2 See Appendix I 3 MSCI UK IMI Extended SRI and Barclays MSCI Sustainable ESG Rating min. BBB and ESG Score min. 2 4 Narrower universes (incl. UK, Emerging Markets, EMU) apply the 5% capping rule on single issuer to ensure proper diversification. ESG research with its three dimensions Intangible Value Assessment (IVA) MSCI ESG Rating1 37 ESG Issues ESG Rating (AAA-CCC) ESG Score (0-10) 30 ESG Indicators ESG Controversies MSCI ESG Score2 Targeting of 25% market cap IVA ESG rating ≥ A IM ESG score ≥ 4 MSCI Parent Index (e.g. MSCI World) MSCI SRI Index (e.g. MSCI SRI World4) Step 1 Business Involvement Screening Exclusion of certain activities Step 2 Positive Screening3 A minimum IVA rating of A and Controversy Score of 4 Targeting of 25% market cap in each sector
  11. 11. 10 1. Business Involvement Screening Source: MSCI , UBS Asset Management. For illustration purpose. MSCI SRI indices exclude companies that are involved in particular activities. • Alcohol: All 'Producers' (Alcohol Revenue > USD 500 million OR Alcohol Revenue >5%) • Tobacco: All 'Producers' AND All 'Distributors', 'Retailers' or 'Suppliers' that earn >15% of revenues from Tobacco-related products. • Gambling: Operations/ Gambling Support AND (Gambling Revenue > USD 500 million or Gambling Revenue > 5%) • Nuclear Power: Utility/ Nuclear Fuel Enrichment/ Nuclear Reactor Design/ Nuclear Uranium Mine/ (Nuclear Supplier AND Nuclear Revenue >15%) • Adult Entertainment: Any Producer + (Revenue > USD 500 million OR Revenue >5%) • GMO: Involvement in GMO and earning any revenue from it • Weapons: Revenue of >5% OR Weapons Revenue > USD 500 million • Controversial Weapons: Landmine, Cluster Bomb, Depleted Uranium, Nuclear Weapon Systems or Components, Bio-Chemical Weapons Systems or Components Business Involvement Exclusion of companies involved in particular activates: Identifies the nature and extent of company business activities to support particular ESG portfolio formation process
  12. 12. 11 2. Intangible Value Assessment (IVA) ESG Rating ESG Rating1) Environment • Climate Change • Carbon Emissions • Energy Efficiency • … Rating of companies (AAA to CCC) based on the extensive list of 37 key issues Social • Labour Management • Health and Safty • Social Opportunities • Human Capital • … Governance • Corporate Behavior • Business Ethics • Anti-competitive Practices • … Source: MSCI , UBS Asset Management. For illustration purpose. 1) See Appendix I for the detail list. Assessment of how well a company deals with ESG issues within the peer group The ESG issues fall into three broad categories. Each GICS sector assigns different significance to issues reflecting their materiality, e.g. • Carbon emission is mostly relevant for the Utilities and Materials sectors • Water stress is critical in the Consumer Staples industry • Health and safety fatalities have been mostly predominant in the Energy and Industrials sector • Business ethics and money fraud issues have high meaning in the Financials and Industrials
  13. 13. 12 ESG Rating Report Example Source: MSCI ESG Manager. UBS Asset Management.
  14. 14. 13 3. ESG Controversy Score Source: MSCI , UBS Asset Management. For illustration purpose. 1) See Appendix I for the detail list. Evaluation of company's ongoing operations, products and services, on an absolute basis ESG controversies fall into broad five categories which also include violations of global norms such as the UN Global Compact initiative. • Controversies include a broad list of issues which are relevant from the ESG criteria and reflect a company's ongoing impact • The severity of controversy is evaluated from very severe to low and scores below 4 imply that a company faces very severe controversies which classify it as ineligible for the SRI index • Examples of controversies may include: recall of vehicles due to diagnosed malfunction; incidents happening during a production process due to lack of proper policies; etc. ESG Score1) Scoring of ongoing companies' controversies (0-10) based on a list of 30 indicators: Environment • Toxic Emissions • Energy & Climate Governance • Bribery & Fraud • Govn. Structures Customers • Customer Relations • Privacy & Data Security Human Rights & Community • Civil Liberties • Human Rights Labor Rights & Supply Chain • Health & Safety • Child Labor
  15. 15. 14 ESG Controversy Score Report Example Source: MSCI ESG Manager. UBS Asset Management. Data as of 14 July 2016.
  16. 16. Portfolio Applications Section 3
  17. 17. 16 Why to add SRI investments to a portfolio? ESG research addresses a wide-ranging number of ESG-related issues Source: UBS Asset Management. For illustrative purpose only.  Can I reduce carbon exposure in my portfolio through the SRI investing?  Can I get more exposure to companies that consider efficient use of clean technologies or support renewable energy?  Are the companies I invest in committed to having the highest standards with regards to production safety and labour rights?  Do the companies I invest in respect human rights and civil liberties?  Are the companies in my portfolio known to be involved in any anti- competitive practices?  Is the management of these companies involved in any bribery or fraud cases? E S G
  18. 18. 17 A. Fostering human rights and labour rights MSCI SRI indices have a higher Impact Monitor (Controversy) score Among others the MSCI ESG Impact Monitor considers the below controversies and indicators: 1. Human Rights & Community: Impact on Human Rights of Local Communities Civil Liberties Human Rights Concerns 2. Labour Rights & Supply Chain: Child Labour Collective Bargaining & Union Discrimination & Workforce Diversity Health & Safety Labour Management Relations Supply Chain Labour Standards 7 7.5 8 8.5 9 9.5 10 Human Rights Local Comm Score Human Rights Civil Liberties Score Human Rights Concerns Score Human Rights Other Score Labor Rights Child Score Labor Rights Diversity Score Labor Rights Emp Score Labor Rights Mgt Rel Score Labor Rights Labor Stand Score Labor Rights Others Score MSCI Emerging Markets 7 7.5 8 8.5 9 9.5 10 Human Rights Local Comm Score Human Rights Civil Liberties Score Human Rights Concerns Score Human Rights Other Score Labor Rights Child Score Labor Rights Diversity Score Labor Rights Emp Score Labor Rights Mgt Rel Score Labor Rights Labor Stand Score Labor Rights Others Score MSCI Emerging Markets SRI Source: MSCI ESG Manager. UBS Asset Management. March 2016.
  19. 19. 18 B. Lower carbon emissions (1/2) MSCI SRI indices significantly reduce the carbon emissions across sectors 0 200 400 600 800 1'000 1'200 1'400 Utilities Energy Materials Industrials Consumer Staples Consumer Discretionary Financials Information Technology Health Care Telecom Services MSCI USA Carbon Emissions (mn t CO2e) Carbon Emission Scope 1 Carbon Emission Scope 2 0 10 20 30 40 50 60 70 80 Utilities Energy Materials Industrials Consumer Staples Consumer Discretionary Financials Information Technology Health Care Telecom Services MSCI USA Socially Responsible Index Carbon Emissions (mn t CO2e) Carbon Emission Scope 1 Carbon Emission Scope 2 The MSCI ESG Intangible Value Assessment caculates the carbon footprint at company level based on two dimensions: Scope 1: All direct GHG emissions from sources owned or controlled by the company: Fossil fuels burned on site Entity-owned or leased vehicles Scope 2: Indirect GHG emissions from consumption: Electricity, heat, or steam Transmission and distribution (T&D) losses associated with some purchased utilities Source: MSCI ESG Manager. UBS Asset Management. March 2016.
  20. 20. 19 B. Lower carbon emissions (2/2) The MSCI SRI indices deliver a substantial relative reduction across carbon metrics1) 159'655 354'726 182'806 277'553 148'885 121'228 322'513 82'084 159'636 131'953 111'268 86'988 50'648 128'965 0 100'000 200'000 300'000 400'000 MSCI World MSCI Emerging Markets MSCI Pacific MSCI EMU MSCI UK IMI MSCI USA MSCI Japan Standard Socially Responsible Total Carbon Emissions (tons CO2) -50.1% 212 354 293 227 139 211 260 116 171 130 115 91 97 107 0 100 200 300 400 MSCI World MSCI Emerging Markets MSCI Pacific MSCI EMU MSCI UK IMI MSCI USA MSCI Japan Standard Socially Responsible Carbon Intensity (tons CO2 / USD M sales) Source: MSCI ESG Manager. UBS Asset Management. March 2016. 1) See Appendix III -49.8%
  21. 21. 20 -0.6 -0.4 -0.2 0.0 0.2 0.4 0.6 0.8 1.0 -6% -4% -2% 0% 2% 4% 6% 8% 10% World World SRI USA USA SRI EMU EMU SRI Japan Japan SRI UK IMI UK IMI SRI Pacific Pacific SRI EM EM SRI Since Sep. 28, 2007 in USD Since Sep. 28, 2007 in USD Since May 26, 2010 in EUR Since Sep. 28, 2007 in JPY Since May 31, 2011 in GBP Since Sep. 28, 2007 iin USD Since May 31, 2011 in USD Outer Bars - annualized performance of TR net indices since inception (left-hand scale) Inner Bars - Sharpe ratios of TR net indices since inception (right-hand scale) C. Improved portflio risk/return characteristics MSCI SRI indices have delivered better relative performance* on a risk-adjusted basis Source: MSCI. UBS Asset Management. Data as of 30 April 2016. Past performance is not reliable indicator for future results. *) The meta-study "The Performance of Socially Responsible Investment" (by Emma Sjöström, Stockholm School of Economics) shows that of twenty‐one studies done recently in academia, five studies report that SRI outperforms conventional investments, seven conclude that SRI investment products have similar performance relative to their conventional peers. Three studies find that SRI generates inferior performance relative to its conventional peers. Finally, six studies report mixed results.
  22. 22. UBS ETF - Sustainable Value Proposition Section 4
  23. 23. 22  SRI investing grows considerably as ESG related issues create risks as well as opportunities and play a more and more significant role in the investment decision.  SRI investing has just become available in a passive format helping to fuel the growing demand for the SRI solutions  MSCI SRI benchmarks build on a rigorous and comprehensive ESG research combining all three SRI pillars  The MSCI SRI benchmark indices offer modest tracking error and solid risk-adjusted performance relative to their parent indices  UBS SRI ETFs allow cost efficiently and flexible to: – Align the portfolio with personal values – Create a positive impact on the environment – Improve the portfolio risk/return  UBS offers a broad range of SRI ETFs and funds for both equity as well as fixed income markets, including currency hedged share classes SRI - Doing well by doing good! UBS SRI ETFs deliver financial and social return Source: UBS Asset Management. UBS Asset Management is a signatory to the Principles for Responsible Investment (PRI)
  24. 24. 23 UBS SRI ETFs: Consistent core building blocks Unique and broad offering Source: UBS Asset Management, June 2016. Emerging MarketsEquity Fixed Income Developed Markets US ASSET CLASS EXPOSURE SHARE CLASS h GBP h EUR h CHF USD USD USD • Consistent core building blocks for Equity and Fixed Income • Diversified equity exposure for Developed Markets (World, USA, EMU, Pacific, Japan, UK) and Emerging Markets • Currency hedged share classes in CHF, EUR, USD and GBP • European exchanges listings at SIX Swiss Exchange, LSE, Borsa Italiana, EuroNext and Xetra • Physically replicated ETFs
  25. 25. 24 UBS SRI ETFs: Sustainable value proposition Data as of 28 October 2016. * Morningstar Sustainability Rating: Morningstar assigns Sustainability Ratings by ranking all scored funds within a Morningstar Category by their Portfolio Sustainability Scores. The ranked funds are then divided into five groups, based on a normal distribution and each fund receives a rating: "High" (top 10%), Above Average (next 22.5%); Average (next 35%); Below Average (next 22.5%) and Low (bottom 10%). Fund Name Fee AuM (CHFm) NAV Ccy. Replication Distribution ISIN Bloomberg Morningstar Sustainbility Rating* Socially Reponsible Equities UBS ETF (LU) MSCI World Socially Responsible UCITS ETF 0.38% 210 USD Physical Yes LU0629459743 WSRUSA SW High UBS ETF (LU) MSCI USA Socially Responsible UCITS ETF 0.33% USD Physical Yes LU0629460089 ASRUSA SW UBS ETF (LU) MSCI USA Socially Responsible hedged CHF UCITS ETF 0.43% CHF Physical Yes LU1273642733 USSRT SW UBS ETF (LU) MSCI USA Socially Responsible hedged CHF UCITS ETF 0.43% CHF Physical No LU1273641503 USSRS SW UBS ETF (LU) MSCI USA Socially Responsible hedged EUR UCITS ETF 0.43% EUR Physical Yes LU1280303014 USSRF SW UBS ETF (LU) MSCI EMU Socially Responsible UCITS ETF 0.28% EUR Physical Yes LU0629460675 ESREUA SW UBS ETF (LU) MSCI EMU Socially Responsible hedged CHF UCITS ETF 0.38% CHF Physical Yes LU1273642907 EUSRT SW UBS ETF (LU) MSCI EMU Socially Responsible hedged CHF UCITS ETF 0.38% CHF Physical No LU1273642816 EUSRS SW UBS ETF (LU) MSCI EMU Socially Responsible hedged USD UCITS ETF 0.38% USD Physical No LU1280300770 EUSRU SW UBS ETF (LU) MSCI Japan Socially Responsible UCITS ETF 0.40% JPY Physical Yes LU1230561679 JPSRF SW UBS ETF (LU) MSCI Japan Socially Responsible hedged CHF UCITS ETF 0.50% CHF Physical Yes LU1273488475 JPSRT SW UBS ETF (LU) MSCI Japan Socially Responsible hedged EUR UCITS ETF 0.50% EUR Physical No LU1273488715 JPSRE SW UBS ETF (LU) MSCI Japan Socially Responsible hedged USD UCITS ETF 0.50% USD Physical No LU1273489440 JPSRU SW UBS ETF (IE) MSCI United Kingdom IMI Socially Responsible UCITS ETF 0.28% GBP Physical Yes IE00BMP3HN93 UKSRF SW UBS ETF (IE) MSCI UK IMI Socially Responsible hedged CHF UCITS ETF 0.38% CHF Physical Yes IE00BZ0RTB90 UKSRT SW UBS ETF (IE) MSCI UK IMI Socially Responsible hedged EUR UCITS ETF 0.38% EUR Physical No IE00BYNQMK61 UKSRE SW UBS ETF (IE) MSCI UK IMI Socially Responsible hedged USD UCITS ETF 0.38% USD Physical No IE00BYNQMM85 UKSRU SW UBS ETF (LU) MSCI Pacific Socially Responsible UCITS ETF 0.40% 36 USD Physical Yes LU0629460832 PSRUSA SW High UBS ETF (LU) MSCI Emerging Markets Socially Responsible UCITS ETF 0.53% 229 USD Physical Yes LU1048313891 MSRUSA SW High Sustainable Corporate Bonds UBS ETF (LU) Barclays MSCI US Liquid Corporates Sustainable UCITS ETF 0.20% USD Physical Yes LU1215461085 CBSUSF SW UBS ETF (LU) Barclays MSCI US Liquid Corp. Sustainable hedged CHF UCITS ETF 0.25% CHF Physical Yes LU1215461754 CBSUST SW UBS ETF (LU) Barclays MSCI US Liquid Corp. Sustainable hedged EUR UCITS ETF 0.25% EUR Physical No LU1215461325 CBSUSE SW UBS ETF (LU) Barclays MSCI US Liquid Corp. Sustainable hedged GBP UCITS ETF 0.25% GBP Physical Yes LU1215461598 CBSUSH SW High High High High High 302 90 107 30 85
  26. 26. Appendix I ESG Scope of Research
  27. 27. 26 Intangible Value Assessment (IVA) ESG Rating: AAA-CCC Source: MSCI ESG Rating Methodology, April 2016. MSCI ESG Rating process calculates each company’s exposure to key ESG risks based on a granular breakdown of a company’s businesses. To arrive at a final letter rating, the weighted averages of the Key Issue Scores are aggregated and companies’ scores are normalized by their GICS sub-industries. These assessments of company performance are not absolute but are explicitly intended to be relative to the standards and performance of a company’s industry peers. By The MSCI ESG Rating process covers the following 10 themes capturing 37 ESG issues:3 Pillars 10 Themes 37 ESG Key Issues Environment Climate Change Carbon Emissions Energy Efficiency Product Carbon Footprint Financing Environmental Impact Climate Change Vulnerability Natural Resources Water Stress Biodiversity & Land Use Raw Material Sourcing Pollution & Waste Toxic Emissions & Waste Packaging Material & Waste Electronic Waste Environmental Opportunities Opportunities in Clean Tech Opportunities in Green Building Opportunities in Renewable Energy Social Human Capital Labour Management Health & Safety Human Capital Development Supply Chain Labour Standards Product Liability Product Safety & Quality Chemical Safety Financial Product Safety Privacy & Data Security Responsible Investment Health & Demographic Risk Stakeholder Opposition Controversial Sourcing Social Opportunities Access to Communications Access to Finance Access to Health Care Opportunities in Nutrition & Health Governance Corporate Governance Board Pay Ownership Accounting Corporate Behavior Business Ethics Anti-Competitive Practices Corruption & Instability Financial System Instability
  28. 28. 27 ESG Controversies Score: 0-10 Source: MSCI ESG Controversies Methodology, May 2016. MSCI ESG Controversies is designed to provide timely and consistent assessments of ESG controversies involving publicly traded companies and fixed income issuers. The evaluation framework used in ESG Controversies is designed to be consistent with international norms represented in numerous widely accepted global conventions, including the Universal Declaration of Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work, and the UN Global Compact. The MSCI ESG Impact Monitor covers the following five categories of stakeholder impact with 30 specific indicators: Environment Social Governance Environment Customers Human Rights and Community Labour Rights and Supply Chain Governance • Biodiversity & Land Use • Toxic Emissions & Waste • Energy & Climate Change • Water Stress • Operational Waste (Non-Hazardous) • Supply Chain Management • Other • Anticompetitive Practices • Customer Relations • Privacy & Data Security • Marketing & Advertising • Product Safety & Quality • Other • Impact on Local Communities • Human Rights Concerns • Civil Liberties • Other • Labour Management Relations • Health & Safety • Collective Bargaining & Union • Discrimination & Workforce Diversity • Child Labour • Supply Chain Labour Standards • Other • Bribery & Fraud • Governance Structures • Controversial Investments • Other
  29. 29. 28 ESG carbon investigation Carbon emissions is one of the 37 key IVA ESG issues This issue evaluates the extent to which companies may face increased costs linked to carbon pricing or regulatory caps. Scores are based on exposure to GHG intensive businesses and emerging regulations; carbon reduction targets and mitigation programs; and carbon intensity over time and vs. peers. Impact • Contribution to climate change Risk / Opportunity • Increased costs linked to carbon pricing or trading • Facility retrofits or operational disruptions due to regulatory caps Exposure Metrics • Extent to which companies operate in jurisdictions where regulations on carbon emissions are stringent or becoming more stringent • Extent to which companies’ main business activities are carbon-intensive based on economic input-output model estimating total GHG emissions relative to sales Metrics • Efforts to reduce exposure through comprehensive carbon policies and implementation mechanisms, including carbon reduction targets, production process improvements, and installation of depollution or emissions capture equipment, and/or switch to cleaner energy sources. • Targets: i) Carbon Improvement Targets; ii) Aggressiveness of target in the context of current performance; iii) Demonstrated track record of achieving carbon reduction targets • Migration: i) Programs or actions to reduce the emissions intensity of core operations • Performance: i) Trend in GHG emissions intensity; ii) GHG emissions intensity vs. peers (GHG Emissions - metric tons CO2e and GHG Emissions Intensity - metric tons CO2e / USD million sales) Sectors • Energy; Materials; Industrials; Consumer Staples; Financials; Utilities Data Sources • Company disclosure and news searches • Carbon Disclosure Project (CDP) • Environment regulatory agencies (EPA, EEA) • Comprehensive Environmental Data Archive (CEDA) • Eurostat – Air Emissions Accounts Source: MSCI. UBS Asset Management.
  30. 30. Appendix II MSCI World SRI Index Breakdowns
  31. 31. 30 MSCI World SRI Source: MSCI, UBS Asset Management. Data as of 31 March 2016. 0% 5% 10% 15% 20% AUT NZL PRT IRL ISR NOR FIN BEL SGP DNK ITA SWE HKG ESP NLD AUS CHE DEU CAN FRA GBR JPN USA MSCI World SRI MSCI World Country breakdown 0% 5% 10% 15% 20% Utilities Telecommunication Services Materials Energy Consumer Staples Industrials Health Care Consumer Discretionary Information Technology Financials MSCI World SRI MSCI World Sector breakdown 55% 60%
  32. 32. 31 MSCI World SRI Source: MSCI, UBS Asset Management. Data as of 31 March 2016. Top 15 Overweights Top 15 Underweights 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% United Parcel Service Allianz Westpac SAP Nike Vodafone Novo Nordisk McDonalds Gilead Sciences IBM Cisco Walt Disney Roche Holdings Procter & Gamble Microsoft MSCI World SRI MSCI World 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% Pfizer Coca Cola Jpmorgan Chase Verizon Communications Alphabet A Alphabet C Amazon Com Wells Fargo & Co Nestle AT&T Facebook General Electric Johnson & Johnson Exxon Apple MSCI World SRI MSCI World
  33. 33. 32 UBS ETF – Contact Information Raimund Müller, CIIA UBS AG Asset Management UBS Exchange Traded Fund Executive Director Head UBS ETF Switzerland & Liechtenstein Stockerstrasse 64 8002 Zurich, Switzerland Tel. +41-44-234 39 81 Mobile +41-79-588 21 53 raimund.mueller@ubs.com Dominik Blunschi UBS AG Asset Management UBS Exchange Traded Fund Director UBS ETF Switzerland & Liechtenstein Stockerstrasse 64 8002 Zurich, Switzerland Tel. +41-44-234 88 06 Mobile: +41-79-587 89 71 dominik.blunschi@ubs.com Giovanna Cilia UBS AG Asset Management UBS Exchange Traded Fund Director UBS ETF Switzerland & Liechtenstein Stockerstrasse 64 8002 Zurich, Switzerland Tel. +41-44-234 53 68 Mobile +41-79-608 65 86 giovanna.cilia@ubs.com Adrian Steiner, CAIA UBS AG Asset Management UBS Exchange Traded Fund Associate Director UBS ETF Switzerland & Liechtenstein Stockerstrasse 64 8002 Zurich, Switzerland Tel. +41-44-234 55 39 Mobile +41-79-608 68 52 adrian-zb.steiner@ubs.com
  34. 34. 33 UBS AG Asset Management P.O. Box CH-8098 Zürich Email ubs-etf@ubs.com www.ubs.com/etf UBS ETF – Contact Information
  35. 35. 34 UBS ETFs – Risk information UBS ETFs investing in equities UBS Exchange Traded Funds invest in equities and may therefore be subject to high fluctuations in value. For this reason, an investment horizon of at least five years and corresponding risk tolerance and capacity are required. All investments are subject to market fluctuations. Every fund has specific risks, which can significantly increase under unusual market conditions. The fund’s assets are passively managed. As a result, the net asset value of the fund’s assets is directly dependent on the performance of the underlying equities. Losses that could be avoided via active management will not be offset. UBS ETFs investing in Real Estate Funds The funds invest in real estate funds under Swiss law that are denominated in CHF and invest exclusively in Swiss properties. The price of the underlying fund units is not determined by estimates of market value but by investor supply and demand. All investments are subject to market fluctuations. Every fund has specific risks, which may increase considerably in unusual market conditions. Please contact your client advisor if you wish to receive further information on the investment risks associated with this product. UBS ETFs investing in Metals The UBS Exchange Traded Fund investing in metals may be subject to considerable fluctuations in value. Investors therefore require an investment horizon of at least five years and corresponding risk tolerance and capacity. All investments are subject to market fluctuations. All funds have specific risks, which may significantly increase under unusual market conditions. The fund’s assets are passively managed. As a result, the net asset value of the fund’s assets is directly dependent on the performance of the underlying equities. Losses that could be avoided via active management will not be offset. UBS ETFs investing in Oil and Commodities The Fund delivers the returns of a broadly diversified commodity index and may therefore be subject to high fluctuations in value. For this reason, an investment horizon of at least five years and corresponding risk tolerance and capacity are required. The returns payable on the Fund are dependant on payments received by the Fund from the Swap Counterparty under the terms of the Relevant Swap and, therefore, are subject to the credit risk of the Swap Counterparty. In the event that the Swap Counterparty defaults under the terms of the Relevant Swap, the Fund may suffer a loss. Assets are passively managed meaning losses that could be avoided via active management will not be offset. The net asset value of the Fund’s assets are materially dependent on the performance of the underlying investments. In case the currency of the product is different from your reference currency, the return may increase or decrease as a result of currency fluctuations. All investments are subject to market fluctuations. Every fund has specific risks, which can significantly increase under unusual market conditions. UBS ETFs investing in HFR The Fund delivers the returns of a broadly diversified hedge fund index and may therefore be subject to high fluctuations in value. For this reason, an investment horizon of at least five years and corresponding risk tolerance and capacity are required. The returns payable on the Fund are dependent on payments received by the Fund from the Swap Counterparty under the terms of the Relevant Swap and, therefore, are subject to the credit risk of the Swap Counterparty. In the event that the Swap Counterparty defaults under the terms of the Relevant Swap, the Fund may suffer a loss. Assets are passively managed meaning losses that could be avoided via active management will not be offset. The net asset value of the Fund’s assets are directly dependent on the performance of the underlying investments. In case the currency of the product is different from your reference currency, the return may increase or decrease as a result of currency fluctuations UBS ETFs investing in Fixed Income This UBS Exchange Traded Fund invests in government bonds of a single country and may therefore be subject to fluctuations in value. For this reason, an investment horizon of at least five years and corresponding risk tolerance and capacity are required. All investments are subject to market fluctuations. Every fund has specific risks, which can significantly increase under unusual market conditions. As a result, the net asset value of the fund's assets is directly dependent on the performance of the underlying index. Losses that could be avoided via active management will not be offset. UBS ETFs investing in Multi Asset Portfolios The Fund is highly dynamic and may exhibit above-average potential growth and investment performance, depending on the economic environment. For this reason, an investment horizon of at least five years and corresponding risk tolerance and capacity are required. The Fund is exposed to the investment risk arising from the Reference Strategy underlying the Swaps. In the event that the swap counterparty defaults under the terms of the relevant swap, the Fund may suffer a loss. The Fund’s assets are passively managed. As a result, the net asset value of the Fund’s assets is materially dependent on the performance of the underlying investments. Losses that could be avoided via active management will not be offset. The Reference Strategy is a rules based Algorithm designed to target consistent returns but may not be effective in delivering such returns.
  36. 36. 35 UBS ETFs – Disclaimer For marketing and information purposes by UBS. For qualified investors only. The information and opinions contained in this document have been compiled or arrived at based upon information obtained from sources believed to be reliable and in good faith, but is not guaranteed as being accurate, nor is it a complete statement or summary of the securities, markets or developments referred to in the document. UBS AG and / or other members of the UBS Group may have a position in and may make a purchase and / or sale of any of the securities or other financial instruments mentioned in this document. UBS funds under Luxembourg and Irish law. The MSCI indexes are the exclusive property of MSCI INC. (“MSCI”). MSCI and the MSCI index names are service mark(s) of MSCI or its affiliates and have been licensed for use for certain purposes by UBS AG (“UBS”). The financial securities referred to herein are not sponsored, endorsed, or promoted by MSCI, and MSCI bears no liability with respect to any such financial securities. The full prospectus of the UBS ETF Sicav contains a more detailed description of the limited relationship MSCI has with UBS and any related financial securities. No purchaser, seller or holder of this product, or any other person or entity, should use or refer to any MSCI trade name, trademark or service mark to sponsor, endorse, market or promote this product without first contacting MSCI to determine whether MSCI’s permission is required. Under no circumstances may any person or entity claim any affiliation with MSCI without the prior written permission of MSCI. “Barclays Indices” are trademarks of Barclays Capital or its affiliates and have been licensed for use in connection with UBS Exchange Traded Funds. UBS Exchange Traded Funds based on Barclays Indices are not sponsored or endorsed by Barclays Capital or its affiliates. Neither Barclays Capital nor its affiliates make any representation regarding the advisability of investing in UBS Exchange Traded Funds. Before investing in a product please read the latest prospectus carefully and thoroughly. Units of UBS funds mentioned herein may not be eligible for sale in all jurisdictions or to certain categories of investors and may not offered, sold or delivered in the United States. The information mentioned herein is not intended to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Past performance is not a reliable indicator of future results. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units. Commissions and costs have a negative impact on performance. If the currency of a financial product or financial service is different from your reference currency, the return can increase or decrease as a result of currency fluctuations. This information pays no regard to the specific or future investment objectives, financial or tax situation or particular needs of any specific recipient. The details and opinions contained in this document are provided by UBS without any guarantee or warranty and are for the recipient's personal use and information purposes only. This document may not be reproduced, redistributed or republished for any purpose without the written permission of UBS AG. Source for all data and charts (if not indicated otherwise): UBS Asset Management This document contains statements that constitute “forward-looking statements”, including, but not limited to, statements relating to our future business development. While these forward-looking statements represent our judgments and future expectations concerning the development of our business, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. Representative in Switzerland for UBS funds established under foreign law: UBS Fund Management (Switzerland) AG, P.O. Box, CH-4002 Basel. Paying agent: UBS Switzerland AG, Bahnhofstrasse 45, CH-8001 Zurich. Prospectuses, simplified prospectuses or key investor information, the articles of association or the management regulations as well as annual and semi-annual reports of UBS funds are available free of charge from UBS AG, P.O. Box, CH-4002 Basel or from UBS Fund Management (Switzerland) AG, P.O. Box, CH-4002 Basel. © UBS 2016. The key symbol and UBS are among the registered and unregistered trademarks of UBS. All rights reserved.

×