CT European Smaller Companies ZNZ

The Fund aims to achieve investment growth over the long term (5 years, or more). It also looks to outperform the MSCI Europe ex UK Small Cap Index (the “Index”) over rolling 3-year periods, after the deduction of charges.

The Fund is actively managed, and invests at least 75% in shares of European smaller companies. The Fund considers European smaller companies to be those domiciled in Continental Europe or with significant business operations, that at the time of purchase, are no larger by free-float adjusted market capitalisation than the largest constituent of the Index.

The Index represents the share performance of smaller sized companies across Europe (ex. the UK) and provides a suitable target benchmark against which Fund performance will be evaluated over time.

The Investment Manager selects smaller companies considered to have good prospects for share price growth across different sectors, and typically invests in fewer than 100 companies, including some companies not within the Index.

The Investment Manager also seeks to create a portfolio that compares favourably against the Index over rolling 12-month periods, when assessed using the Columbia Threadneedle ESG Materiality Rating model.

This model (developed and owned by Columbia Threadneedle Investments) analyses company data to assess how effectively material environmental, social and governance (ESG) risks and opportunities are being managed. If sufficient data is available, the combined results are expressed as a numerical rating to indicate how much exposure a company has to material ESG risks and opportunities in a particular industry.

Whilst the Fund may still invest in companies that have poor ESG Materiality ratings, at least 50% of the portfolio is invested in companies with strong ratings.

The Investment Manager engages with companies with a view to influencing management teams to address material ESG risks and improve their ESG practices.

Columbia Threadneedle Investments is a signatory to the Net Zero Asset Managers Initiative and has committed to an ambition to reach net zero emissions by 2050 or sooner for a range of assets, including the Fund. As such, the Investment Manager will proactively engage with companies to assist with progressing this and may disinvest from those not meeting the minimum standards.

The Fund only invests in companies that follow good governance practices. It does not invest in companies which derive revenue from industries or activities above the thresholds shown: tobacco production (5%); nuclear weapons – indirect involvement (5%), conventional weapons – military, or civilian firearms (10%), and thermal coal – extraction or power generation (30%), providing a company is not engaged in new coal projects.

The Fund excludes companies that have direct involvement in nuclear or controversial weapons, and companies determined to have breached international standards and principles.

The Fund may invest in other securities, funds (including funds managed by Columbia Threadneedle companies), money market instruments, deposits, and cash. Derivatives may only be held with the aim of reducing risk or managing the Fund more efficiently.

Market capitalisation refers to the total value of a company’s shares. The free-float adjusted method of calculating market capitalisation includes only shares available for purchase in public equity markets so excludes, for example, shares held privately, by the company itself and its affiliates or by governments.