40 Pension Protection Fund Climate Change Report 2022/23 APPENDICES CONTINUED Appendix E Appendix F MSCI disclaimer Our climate change voting guidelines This disclosure was developed using information from MSCI Climate change is a key area of focus for us, and Net Zero Climate-related Shareholder Proposals: For European ESG Research LLC or its a昀케liates or information providers. stewardship is a fundamental part of our approach to companies, we will be reviewing any shareholder proposals Although the Pension Protection Fund’s information management of climate-related risks. Read our Climate related to climate change internally. providers, including without limitation, MSCI ESG Research Change Policy for more details. Through our stewardship Companies on the PPF’s Climate Engagement Watchlist: LLC and its a昀케liates (the ‘ESG Parties’), obtain information provider and participation in collaborative initiatives, we (the ‘Information’) from sources they consider reliable, none expect tangible progress around Net Zero and work with Shareholder meetings at companies on our Climate Watchlist of the ESG Parties warrants or guarantees the originality, both our managers and companies to encourage the will also be reviewed internally by the ESG Team. This accuracy and/or completeness, of any data herein and transition to a low-carbon economy. process will allow additional analysis around the progress expressly disclaim all express or implied warranties, including being made against our internally-set targets. A vote against those of merchantability and 昀椀tness for a particular purpose. In order to measurably track and encourage progress on management may be necessary if we consider there has The Information may only be used for your internal use, may climate, we utilise the management quality assessment of been inadequate progress. not be reproduced or redisseminated in any form and may companies by the Transition Pathway Initiative (TPI). We (Last reviewed March 2023.) not be used as a basis for, or a component of, any 昀椀nancial are also informed by the Climate Action 100+ Net Zero instruments or products or indices. Further, none of the Benchmark for those companies included in this assessment. Information can in and of itself be used to determine which We also will be guided in our voting by the industry initiatives securities to buy or sell or when to buy or sell them. None around Net Zero alignment for both asset owners and our of the ESG Parties shall have any liability for any errors or asset managers. omissions in connection with any data herein, or any liability For 2023, we have increased the thresholds for climate- for any direct, indirect, special, punitive, consequential or any related voting guidelines as noted below: other damages (including lost pro昀椀ts) even if noti昀椀ed of the possibility of such damages. Transition Pathway Initiative Management Quality score: All European and Australian companies in all sectors below Level 4; all coal, oil, gas, utilities and automotive companies below Level 4 vs. Level 3 for autos in 2022; below Level 3 for all remaining sectors/companies in US and Asia and Emerging Markets; Climate Action 100+ Benchmark: Companies that have no medium-term targets in place as identi昀椀ed by indicator 3 of the Climate Action 100+ Benchmark; Coal: Companies identi昀椀ed as expanding coal-昀椀red infrastructure by the Global Coal Exit List or companies that have signi昀椀cant dependence on coal without a su昀케ciently ambitious timeline and strategy for coal phaseout; and Deforestation: Companies that score below 10 on the Forest 500 ranking (assesses companies’ disclosure and management of deforestation risks); Financial institutions that score 0 on the Forest 500 ranking.