b'New Frameworks for Incorporating Climate Change into Investment DecisionsAs of this writing, the carbon dioxide concentration inIt is a language for investors and companies to discuss climateEXPERIENCE YOU CAN RELY ON. change, to weigh its risks and to explore its opportunities. It the earths atmosphere has reached over 415 parts perinvolves a number of ways to evaluate governance, business million, the highest level in over 800,000 years.strategy,riskmanagement,metricsandtargets.ItisalsoTHE TEAM YOU CAN TRUST.importanttonotethattheTCFDconsiderstheimpactof climatechangeonacompanysperformanceratherthana Investors often talk about climate risk as something that liescompanys impact on the climate, making it a framework that far in the future.The reality however, is that we are alreadyis relevant across sectors. Of course, fossil fuel and energy starting to see signs of it in financial markets. Perhaps oneintense companies are among those on the front lines here. of the most acute example is the California wildfires, whichHowever, given the wide-ranging and difficult-to-avoid potential burnedover875,000acresin2018.Theincreasingsizeimpacts of uncontrolled climate change, the systemic impact and severity of the fires in California is attributed to droughton the broader economy and society across industries needs toJarislowsky,FraserLimitedhasbeenaproudpartnerofIndigenous conditions as a result of warmer temperatures. PG&E, one ofbe examined. To make better informed investing decisions, wecommunitiessince1999.Thisongoingrelationshipisbuiltona the two main California electric utilities associated with theneed complete robust performance data across all industries thatmutual understanding that the responsible stewardship of the capital fire,incurred liabilities of $30B and hasfiled for bankruptcy.measure how well businesses are adapting their technologies, As of this writing, the carbon dioxide concentration in the earthspractices and strategies to the wide range of potential outcomes. entrusted to us is paramount to ensuring the long-term prosperity of your atmosphere has reached over 415 parts per million, the highestcommunities.Assuch,wearecommittedtodesigning portfolios level in over 800,000 years. The increased concentration ofTCFD-aligned disclosure, which remains voluntary for now, iscustomizedtoeachclientsspecificneeds,withthe objective of greenhouse gases is causing the earths temperature to warm,gaining traction as the global standard. Here at home, CPApreserving capital and providing long-term growth.and global temperatures are on a trajectory to exceed +3 degreesCanada is encouraging members of the accounting profession Celsius of warming by the end of this century, far exceeding the 2to familiarize themselves with the recommendations, and theAs your partner, Jarislowsky Fraser and its related foundations are degree target that scientists suggest would likely limit the amountBankofCanadaalsoincludedclimatechangeriskfortheproud to support the following initiatives:of damage.A significant ratcheting up of policy and actionfirsttimeinits2019FinancialSystemReview,specifically is required to hasten the transition to a low-carbon economy. pointing to the TCFD and its merits. hhhhhhhhhhhhggggggggg Scholarships for Indigenous students, in partnership with Indspire.Investor Considerations Jarislowsky Frasers Approach Educating Sponsor of National Aboriginal Trust OfficersThisbackdropcreatesuncertaintyforinvestorsintheformAt Jarislowsky Fraser (JFL), we value TCFD-aligned corporateAssociation (NATOA).ofphysicalrisks,bothacute(e.g.naturaldisasters)andreporting as part of our investment process. We are also committed The Jarislowsky Chair in Water and Global Healthan academicchronic(e.g.waterscarcity),aswellasinthequestionsto engaging with the companies in our portfolios to increasinglyposition focused on providing safe drinking water and improvedsurroundingtransition to a low-carbon economy.What willalign their reporting with TCFD recommendations.JFL hassanitation to communities across Canada and around the globe.it take to get to a 2 degree world?How will regulation, suchbeen a trusted institutional investor for many decades, and we as carbon taxes, evolve?What will be the pace of changebelieve our fiduciary duty is to consider all the material risks The Jarislowsky Fulbright Canadas Visiting Research Chair inintechnology(e.g.smartgridsandcarboncapture),andassociated with investments that we make on behalf of clients.Aboriginal Studies.consumer preference(e.g. electric vehicles and greener fuels)? Foundational support for Junior Achievement (JA) BritishWhat policies and social changes will be necessary to ensureOurapproachtosustainableinvestinginvolvesintegratingColumbia Indigenous Programs.a just climate transition that tries to avoid the economic andenvironmental, social and governance (ESG) factors into the societal disruptions from such a dramatic change?hhhhhhhh investment process. Now, TCFD has provided a new language Sponsorship of a number of educational ventures includingto frame our consideration ofclimate change, which brings withfinancial workshops for our Indigenous clients.it a gamut of risks and opportunities affecting the strategy and For investors and boards of directors, the primaryresilience of a business.And, because we think its important___________________________________question has become: Just how resilient are ourtowalkthewalk,in2019,wealsopublishedourownContact us to discuss our services:assets and value creation strategies in the face ofinaugural report on how were monitoring and managing climate climate change? risk on behalf of our clients. This means explaining how ourLeanne Flett Kruger, Director, Indigenous Services governance and strategy incorporate climate risk, disclosing theLFlettKruger@jflglobal.com | 1-800-736-8666carbon footprint of our portfolios, and examining the resilience More shareholders, and more companies, have begun to lookof our portfolios to climate change and the policies designed to closely at the risks and opportunities of climate change. Forcombat it. The report will likely evolve over time, in accordance investors and boards of directors, the primary question haswith the broader disclosure and data related to climate change. become: Just how resilient are our assets and value creationWe see this as a starting point in what will be a multi-year strategies in the face of climate change?Finding a way tojourney, and we welcome additional perspectives along the way. answer this question fell to the Task Force on Climate-related FinancialDisclosure(TCFD),establishedinlate2015by theFinancialStabilityBoard,theorganizationresponsibleJFL has been a trusted institutional investor for formonitoringthewelfareoftheglobalfinancialsystem.many decades, and we believe our fiduciary duty Drawing a wide range of members from various industries andis to consider all the material risks associated with backgrounds, the TCFD was charged with creating a frameworkinvestments that we make on behalf of clients.INSTITUTIONALPRIVATE WEALTH MUTUAL FUNDSforcompaniesandinvestorstodisclosetheirapproach andexposuretoclimate-relatedrisksandopportunities. MONTREALITORONTOICALGARYIVANCOUVERINEW YORKwww.jflglobal.comIf you wish to discuss how you can incorporate sustainable What the TCFD brings is not just a long-term focus, but alsoinvesting into your investments, contact Leanne Flett Kruger at a common framework to drive comparability and consistency. LFlettKruger@jflglobal.com.hhhhhhhhhhhhhhhhhhhhhhhhhh'