Status under the EU Sustainable Finance Disclosure Regulation (SFDR)

B. No Sustainable Investment Objective

The Investment Manager uses a pass/fail test meaning that each sustainable investment must meet all three of the requirements below:

1. it positively contributes to an environmental or social objective.
2. it does not cause significant harm to any environmental or social sustainable investment objective; and
3. it follows good governance practices.

This Sub-Fund invests a minimum of 20% of its net asset value in sustainable investments. All sustainable investments will be assessed by the Investment Manager to comply with its sustainable investment methodology.

The sustainable investments held by the Sub-Fund may contribute to addressing a range of environmental and/or social issues. An investment will be determined to make a positive contribution to an environmental or social objective where 1) its business activity, defined as a minimum 20% of revenue, positively contributes to environmental and/or social objectives, which may include, but are not limited to alternative energy, energy efficiency, pollution prevention, nutrition, sanitation, and education; or 2) its business practices incorporate carbon emissions targets approved by the Science-Based Targets initiative (SBTi); or 3) in the case of Green, Social and Sustainability Bonds, 100% of the proceeds of the issuance must be exclusively and formally applied for the financing or refinancing of projects with social and/or environmental benefits.

Sustainable investments meet the do no significant harm requirements, as defined by applicable law and regulation. Investments considered to be causing significant harm do not qualify as sustainable investments.

The Investment Manager identifies investments which negatively impact sustainability factors and cause significant harm by using third-party data and/or analysis, including the MSCI ESG Controversies methodology. However, assessment of adverse impacts is not wholly dependent on third-party data, or any methodology limitations thereof.

The Investment Manager uses third-party data and/or analysis proprietary to the Investment Manager, including the MSCI ESG Controversies methodology, to assess the principal adverse impacts on sustainability factors as set out in table 1 of Annex I of the Commission Delegated Regulation (EU) 2022/1288 as amended from time to time. Investments considered to have negatively impacted sustainability factors and cause significant harm are not considered as sustainable investments.

The MSCI ESG Controversies methodology, which is designed to identify companies that may have caused or contributed to negative environmental or social impacts, aligns with certain principal adverse impact indicators and is used to create specific exclusions in relation to those indicators. Whilst the principal adverse impact indicators do not provide specific thresholds for harm, they can be leveraged in identifying potentially the most significant harm. Further information on the MSCI ESG Controversies methodology can be found at https://www.msci.com/.MSCI Controversies and Global Norms Methodology.

This framework is subject to ongoing review, particularly as the availability, and quality, of the data evolves.

C. Environmental or social characteristics of the financial product 

The Fund promotes the following environmental and/or social characteristics:

The Sub-Fund promotes support for the UN Global Compact principles (which cover matters including human rights, labor, corruption, and environmental pollution).

The Sub-Fund promotes human health and wellbeing by applying binding exclusions.

The Sub-Fund promotes climate change mitigation.

The Sub-Fund promotes better management of environmental, social and/or governance risks by minimising its exposure to issuers with the worst ESG risk ratings

The Sub-Fund does not use a reference benchmark to attain its environmental or social characteristics.

D. Investment strategy

The Sub-Fund aims to outperform the Bloomberg Global Corporate ex-EM Fallen Angels 3% Issuer Capped Index (the “Index”) over the long term by investing primarily in an actively managed portfolio of sub-investment grade corporate bonds, focused on Fallen Angels (bonds that were rated investment grade at issue or at some point, but later downgraded to sub-investment grade).

The Investment Manager aims to outperform the Index primarily through the selection of securities. The Investment Manager aims to select bonds that are undervalued or fairly valued relative to their issuer’s creditworthiness, while avoiding bonds that are overvalued. The Investment Manager may also emphasise the most recently downgraded Fallen Angels,

The Investment Manager will seek to maintain a similar overall risk profile to the Index, including similar interest rate and credit risk, while targeting an ex ante annualised tracking error of between 0.5% and 2.0%.

Investors should read this section in conjunction with the Sub-Fund’s investment strategy (as set out in the supplement for the Sub-Fund under the heading “Investment Objective and Policy”).

The binding elements of the investment strategy described below that are implemented as screens are coded into the compliance module of an order management system utilising third-party data provider(s) on an ongoing basis. The exclusionary screens are implemented on both a pre and post trade basis enabling any proposed transactions in an excluded security to be blocked and to identify any changes to the status of holdings when third-party data is periodically updated.

The companies in which investments are made are assessed by the Investment Manager to follow good governance practices. The Investment Manager has developed a proprietary framework based on internal analysis and data from external vendors to assess securities on specific indicators relating to good governance.

The good governance practices of investee companies are assessed prior to making an investment and periodically thereafter in accordance with the Sustainability Risk Policy (“Policy”).

The Policy sets minimum standards against which investee companies will be assessed and monitored by the Investment Manager prior to making an investment and on an ongoing basis. Such standards may include, but are not limited to: sound management structures, employee relations, remuneration of staff and tax compliance.

The Policy can be found at https://www.janushenderson.com/corporate/who-we-are/brighter-future-project/responsibility/esg-resources.

In addition, the Investment Manager is a signatory to the UN-supported Principles for Responsible Investment (PRI). As a signatory, the good governance practices of investee companies are also assessed by having regard to the PRI prior to making an investment and periodically thereafter.

E. Proportion of investments

A minimum of 80% of the investments of the financial product are used to meet the environmental or social characteristics promoted by the Sub-Fund. In addition, the Sub-Fund invests a minimum of 20% of its net asset value in sustainable investments.

The remaining investments, which are not used to meet the environmental or social characteristics, relate to cash and other instruments held as ancillary liquidity or for efficient portfolio management purposes.

F. Monitoring of environmental or social characteristics

The sustainability indicators used to measure the attainment of each of the environmental or social characteristics promoted by this financial product are:

• Number of companies in the Sub-Fund’s portfolio with a UNGC status of “fail” (expected to be 0%)
• Proportion of the portfolio compliant with the ESG exclusionary screens described below under “ Section G” (expected to be 100%)
• Proportion of the portfolio invested in securities issued by corporations with an ESG rating of B or above, based on the Investment Manager’s predictive ESG rating framework (expected to be at least 80%)

The IM Business Risk team provide ongoing assurance, where required, that we can evidence investment products being managed in line with documented sustainability commitments where automated controls and/or 3rd party data are not available. Financial Risk review and challenge investment management in light of ESG-related risks, alongside traditional market risk metrics, and embed sustainability risk into the risk profiles. Investment Compliance implement exclusionary screening and monitor this on an ongoing basis in addition to elements of manual oversight where relevant.

G. Methodologies for environmental or social characteristics

The Investment Manager will:

• Apply screens to exclude bond issuers deemed to be in violation of UN Global Compact principles or OECG Guidelines for Multinational Enterprises, or deemed to be causing significant environmental harm”¹
• Exclude bond issuers involved with the following activities (subject to revenue thresholds where shown):
  • - Adult entertainment (>= 5% of revenue)
  • - Alcohol production (>= 5% of revenue) or distribution (>=15% of revenue)
  • - Gambling (>=5% of revenue)
  • - Tobacco cultivation or production¹
  • - Recreational cannabis
  • - Nuclear weapons
  • - Controversial weapons¹
  • - Civilian firearms (>= 5% of revenue)
  • - Fossil fuels: revenues from oil, gas, coal and energy-intensive electricity over the thresholds specified in the requirements for EU Paris-aligned Benchmarks, with stricter revenue thresholds applied for oil (0%) and thermal coal (0%)¹
• Apply screens to ensure that at least 80% of the portfolio is invested in securities issued by corporations with an ESG risk rating of B or higher, according to the Investment Manager’s predictive ESG rating framework (which is based primarily on MSCI data)

¹Note that these exclusionary screens are designed to be consistent with the exclusions required for EU Paris-aligned Benchmarks.

The Investment Manager has chosen MSCI as its primary source for ESG data and research. Where coverage gaps are identified, specialist ESG data vendors or the Investment Manager’s proprietary research (including engagement with investee companies, where relevant) may be used to complement it. Portfolio managers may challenge third-party data if they consider that it is insufficient or inaccurate (if, for example, it is historic, vague, based on out-of-date sources) or if they have other information to make them doubt its accuracy. Any “override” of third-party data must be approved by the Investment Manager’s cross-functional ESG Oversight Committee.

H. Data sources and processing

The Investment Manager has chosen MSCI as its primary data source for ESG (Environmental, Social and Governance) research.

Where coverage gaps are identified, specialist ESG Data vendors or in-house research may be used to complement the ESG research. This helps ensure that in an effort to provide consistent data and methodologies are given an ESG measure per security type and hence, enabling them to be compared correctly in the portfolio construction process.

JHI has built a centralised proprietary research alignment process; The central research alignment process aligns data at three different levels: -

1. Entity Level,
2. Position Level, and
3. Fund Level.

The research alignment and mapping capability is critical to JHI's ESG methodology, as we recognise a security could inherit the ESG information from the issuing legal entity, however, some ESG risks will be instrument specific.

JHI applies a series of Data Quality rules to ensure the integrity of the data being ingested into the central research alignment solution. JHI data that is not aligned correctly to the definition as provided by the data vendor is not ingested into the central cloud-based data warehouse and exceptions are raised. Remediation includes challenging the data provider or internal operations supporting internally managed Systems of Records. Where appropriate the Data Owner responsible and accountable for the data is notified through the internal Data Governance process to resolve outstanding exceptions.

JHI receives weekly automated data feeds from external ESG Data vendors, which are ingested into a cloud-based data warehouse.

Some data used to support binding criteria as received from external providers may be estimated data. For positions not covered by the external data provider, proprietary research may be used. This could range from proprietary research alignment against the external data vendor to written confirmation from the issuing entity that it aligns to the binding criteria. The appropriateness of the evidence provided is assessed by an independent body at JHI.

I. Limitations to methodologies and data

Data coverage is directly driven by the coverage of the underlying ESG Data Provider.

The promotion of the social and environmental characteristics is not wholly dependent on third party data, or any methodology limitations thereof and is typically also informed by proprietary research, engagement with investee companies where there might be relevant data gaps.

JHI’s internal data structure provides sufficient flexibility to incorporate proprietary research or adapt evaluations to future requirements.

JHI is aware of data gaps in ESG Research for non-traditional asset classes compared to mainstream asset classes such as equities and debt instruments.

J. Due Diligence

The JHI Responsible Investment Policy sets out the firmwide approach to ESG Integration, including JHI’s Responsible Investment Principles for long-term investment success, our approaches to Stewardship and Engagement and Firmwide Exclusions applied to investee companies. These exclusions are based on classifications provided by third-party data ESG data providers.

This classification is subject to an investment research override in cases where sufficient evidence exists that the third-party field is not accurate or appropriate.

Each Investment desk completes their own due diligence processes ahead of making any investment decisions within their Article 8 funds, using internal and external tools and research.

The IM Business Risk team provide ongoing assurance, where required, that we can evidence investment products are being managed in line with documented sustainability commitments where automated controls and/or 3rd party data are not available. Financial Risk review and challenge investment management in light of ESG-related risks, alongside traditional market risk metrics, and embed sustainability risk into the risk profiles. Investment Compliance ensure that ESG-related activities are managed in line with regulatory requirements and expectations and considered within our compliance framework.

K. Engagement Policies

In addition to the binding elements of the investment strategy described above, stewardship forms an integral and natural part of Janus Henderson’s long-term, active approach to investment management. In general, Janus Henderson prefers an engagement-focused approach to a firm-level exclusion or divestment policy, in sectors where we have identified financially material sustainability risks. We believe this approach is best to seek to maximise risk-adjusted returns for our clients and for driving positive change at our portfolio companies. Further details on our Engagement Policy can be found in the Responsible Investment Policy, published under the 'ESG Resource Library’ at https://www.janushenderson.com/corporate/who-we-are/brighter-future-project/responsibility/esg-resources/.

The Firm supports a number of stewardship codes and broader initiatives around the world and is a signatory to the UK Stewardship Code.

Janus Henderson has a Proxy Voting Committee, which is responsible for establishing positions on major voting issues and creating guidelines overseeing the voting process.

The Committee is comprised of representatives from Asset Servicing, Compliance, Operational Risk, Responsible Investment and Governance, and equity portfolio management. Internal legal counsel serves as a consultant to the Committee and is a non-voting member . Additionally, the Proxy Voting Committee is responsible for monitoring and resolving conflicts of interest with respect to proxy voting.

L. Designated Reference Benchmark

The Fund does not use a reference benchmark to attain its environmental or social characteristics.

Principal adverse impacts (PAIs)

As at the 26 Feb 2026, the Investment Manager considers the following principal adverse impacts on sustainability factors (“PAIs”) for this Fund: