he Fund does not invest in companies that derive any revenue from the production of tobacco, or the production of controversial weapons, their key components or services. However, the Fund may invest in companies that do not derive more than 10% of their revenues from the retail of tobacco, or companies that derive more than 50% of their revenues from products or services related to tobacco. The Fund does not invest in companies that derive more than 5% of their revenues from the production of firearms, or military contracting involving weapon-related products or services, or companies that derive more than 10% of their revenues from retail of firearms. It does not invest in companies involved in palm oil that have less than 80% of RSPO-certified hectares of land at their plantations. Fossil fuel production-based exclusions mean that the Fund does not invest in companies that derive more than 5% of their revenues from fossil fuel extraction through Arctic drilling, or companies that derive more than 10% of their revenues from fossil fuel extraction through Oil sands. It does not in companies that derive more than 20% of their revenues from thermal coal extraction/mining or power generation. 

Behaviour-based exclusions refer to the Fund's controversial behaviour screening that measures the company's compliance with ILO, UNGP, UNGC and OECD standards. If Robeco deems a company to severely breach these standards and fails its enhanced exclusions criteria, then the company will no longer be eligible for investment.

The underlying fund Robeco SDG Credit Income Fund invests in companies that contribute to realising the UN Sustainable Development Goals. The selection of companies as part of the strategy is based on fundamental analysis. Sustainability is incorporated into the investment process by the means of a target universe, exclusions, and ESG integration.

Sustainability factors, such as environmental, social and employee matters, respect for human rights, anti-corruption, and anti-bribery matters, may have a positive or negative impact on the financial performance of the Fund's investments. While sustainability factors can also have positive impacts (opportunities), the sustainability risks for the purpose of integration are defined as the negative materialization of the factors. Sustainability as a risk factor is relevant to all investments, while sustainability opportunities are typically relevant to the products that have an ESG objective. 

Sustainability risks can be climate-related, or related to other environmental, social and governance practices. Robeco uses various proprietary and external tools to identify and evaluate sustainability factors and related risks. Its Investment Due Diligence and Risk Management frameworks are the basis to identify and evaluate potential sustainability risks for its investment portfolios. Robeco's sustainability risk identification covers a broad range of ESG factors, including Environmental factors, such as climate change vulnerability, carbon pricing, biodiversity, environmental waste and pollution. Social factors, such as compliance with recognized labour standards, compliance with employment safety and health protection, fair working conditions, diversity, and training and development opportunities, product safety and customer welfare, and infectious diseases. Governance factors include risk and business continuity management, integrity and ethical behaviour, information security and data protection, board composition and remuneration, regulatory and tax compliance, and political instability.

Robeco holds membership, is a signatory or participates in multiple Sustainable Investment initiatives, such as Climate Action 100+ Initiative, Institutional Investors Group on Climate Change (IIGCC), Net-Zero Asset Managers Initiative (NZAM), Principles for Responsible Investment (PRI), Task Force on Climate-related Financial Disclosures (TCFD), Task Force on Nature-related Financial Disclosures (TNFD), United Nations Global Compact (UNGC), and other. 

Robeco acts in accordance with international standards on responsible conduct. International treaties, such as the International Labor Organization (ILO) standards, United Nations Guiding Principles (UNGPs), United Nations Global Compact (UNGC) Principles, and the Organization for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises guide Rebeco in assessing controversial behaviour of companies. 

The Underlying Fund solely invests in credits issued by companies with a positive or neutral impact on the SDGs. The impact of issuers on the SDGs is determined by applying Robeco's SDG Framework.