J. P. Morgan Funds

    152

    Funds Group: J. P. Morgan Funds

    Management Company: J.P. Morgan Investment Management Inc.

    Funds Affected: (1) JPMorgan Intrepid Sustainable Equity Fund, JPMorgan Intrepid Advantage Fund, (2) JPMorgan Municipal Income Fund, (3) JPMorgan Corporate Bond Fund and JPMorgan Emerging Markets Equity Fund

    Principal Sustainable Investment Management Strategy: (1-3 )ESG Integration, (2) Impact

    Summary:

    (1) In managing the funds, J.P. Morgan Investment Management identifies companies that, in the adviser’s opinion, generally approach environmental, social and corporate governance (ESG) practices in a thoughtful manner while also having attractive value, quality and momentum characteristics. The funds seek to invest in companies that, on a combined basis, appear attractive when considering all of these financial and sustainability characteristics.

    The funds define ESG characteristics as follows:

    • Environmental — companies that actively strive to reduce the negative impact of their business operations on the environment. In this context, the adviser analyzes factors such as the company’s likely impact on climate change, natural resource use, pollution and the use of clean technology
    • Social — companies that consider the social impact of their business internally and externally. In this context, the adviser reviews considerations such as worker safety, product safety and integrity, healthier products, impact on the community and human rights
    • Governance — companies that embrace corporate governance principles. In reviewing governance characteristics, the adviser considers issues such as board accountability and diversity, shareholder rights, executive compensation, business ethics and government and public policy.

    (2) The fund invests the majority of its assets in securities whose use of proceeds, in the adviser’s opinion, provide positive social or environmental benefits. In order to identify and invest in bonds that provide positive social or environmental benefits, the adviser determines and assesses each bond’s intended use of proceeds. The adviser will generally view bonds that finance affordable housing, healthcare, municipal water & sewer, education, mass transit, not for profits and issuer designated green bonds as promoting positive social or environmental benefits. In addition to the uses of proceeds noted above, the adviser may identify additional uses of bond proceeds that it believes will provide positive social or environmental benefits and may invest in such bonds as part of the fund’s investment strategy. The use of proceeds determination for securities purchased by the fund will be made at the time of purchase. If the use of proceeds of a security changes after the time of purchase so as to no longer provide positive social and/or environmental benefits, the fund may continue to hold the security.

    (3) As a part of this analysis, research analysts seek to assess the risks presented by certain environmental, social and governance factors.