The Trust does not invest in companies that, to the best of our knowledge, receive any revenue from the manufacture, distribution or sale of tobacco or alcohol products, including nicotine vaping products; the manufacture, distribution or sale of weapons or armaments including controversial weapons and nuclear weapons; extraction or sale of thermal coal, metallurgical coal, uranium, oil or gas (other than recycled oil); gambling or betting operations; the production, sale or distribution of pornography; the manufacture or distribution of toxic pesticides; old growth forest logging; or operations or transportation associated with the live exportation of animals offshore.

The Trust also considers a "Do No Significant Harm" (DNSH) criteria. The DNSH assessment allows the Fund Manager to undertake an additional analysis to detect negative environmental, societal or governance impacts and seek to understand a company's practices to prevent, address and remedy human rights or modern slavery abuses in their supply chain. The company's adherence to the International Labour Organisation (ILO) standards is also considered.

The Trust is an actively managed portfolio of mainly smaller and mid-cap listed (and unlisted) companies that are considered to be "Better Future Enabler Investments" that are defined as companies that conduct businesses that are deriving more than 50% of their gross revenue from business operations that are generating renewable energy, improving energy efficiency or seeking to reduce greenhouse gas emissions; or are involved in water treatment or remediation; or are focused on providing environmental services or otherwise focused on environmental outcomes; or involve technology or processes that enable businesses and/or individuals to reduce their resource use or improve the efficiency of their resource use (including by processing materials for recycling); or are providing nature-based technologies or pollutions, providing products or services that improve biodiversity outcomes in existing business models or prevent the loss of biodiversity (including reducing pollution, improved farming practices, protecting: marine life, plant life & natural ecosystems, improving forestry); or contribute to social welfare outcomes, including improving the safety, health or well-being of workers; or relate to health outcomes, including health products and health services; or relate to education services or outcomes (including without limitation childcare); or involves the leasing of properties to organisations that provide healthcare, education or childcare or for social housing purposes. Typically, no less than 35% of the portfolio will be held in Better Future Enabler Investments.

"Better Future Leader Investments" are companies that, at the time of acquisition, have a Perennial-derived Environmental, Social, Governance and Engagement Score (ESG&E Score) which exceeds the ESG&E score of the benchmark index and does not satisfy the Better Future Enabler Investments definition. The ESG&E Score is a proprietary scoring system that has been developed by Perennial. Perennial uses the ESG&E Score to evaluate a company's Environmental, Social and Governance (ESG) performance.

Perennial has been a signatory to the United Nations Principles of Responsible Investment since 2009 and is a supporter of the Task Force on Climate Related Financial Disclosures and encourages companies to report under the initiative. Many companies held in the Better Future Strategy contribute positively to a range of SDGs, particularly the Better Future Enabler investments. Perennial is a signatory to the 30% Club, which campaigns for at least 30% of women on ASX300 boards, supports Climate Action 100+, and is a founding signatory of Investors Against Slavery & Trafficking ASIA-Pacific (IAST APAC) and on a working group to assist companies to identify and take action on modern slavery and human rights issues in their supply chain. Perennial is a member of the Responsible Investment Association Australasia (RIAA) and is recognised as a Responsible Investment leader by RIAA in 2020, 2021, 2022 and 2023. The Better Future Trust and the Perennial Better Future Fund (Managed Fund) (ASX: IMPQ) are certified Responsible Investment products. 

The Fund Manager also considers an investee company's adherence to the International Labour Organisation (ILO) standards, International Bill of Human Rights, OECD Guidelines for Multinational Enterprises, and the UN Guiding Principles (UNGPs) on Business & Human Rights.