The Indigo Group at Morgan Stanley. Indigo Sustainable Portfolios

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1 The Indigo Group at Morgan Stanley Indigo Sustainable Portfolios

2 3280 Peachtree Road, NE Suite 1900, Atlanta, GA / MAIN / TOLL-FREE / FAX

3 The Indigo Group at Morgan Stanley Capital creates change in the world. The Indigo Group seeks to deliver competitive financial returns while driving positive environmental and social impact by investing in companies that exemplify leadership in social and environmental responsibility. Our framework enables clients to align their portfolios with their unique impact investing priorities. Morgan Stanley has leveraged its market position as a leading Wealth Management firm to empower our clients to Invest with Impact. Our Indigo Sustainable Portfolios utilize leading edge financial and sustainability data analytics so clients can optimize investment alignment with their personal values without sacrificing performance. Current research shows that using sustainable investment strategies usually meets and often exceeds the performance of comparable traditional approaches. 1 Evaluating sustainability factors for a company is not just "a good thing to do"; it is now widely considered to be part of a fiduciary s duty. As impact-oriented metrics increase in quality and availability, investors can take actionable steps toward building a more positive, resource-efficient economy. 1. Morgan Stanley Research, Sustainable Investing Myth Busters (May 2017) THE INDIGO GROUP 3

4 Meet the Professionals We work with individuals and institutional asset owners to develop We work with sustainable individuals investment and institutional portfolios. asset owners The to dramatic develop increase sustainable in investment the availability portfolios. of The high-quality dramatic increase Environmental, in the availability of and high-quality Governance ESG research (ESG) and research a growing and body of a academic growing Social body studies of show academic a correlation studies between show strong a investment correlation performance between and ESG factor integration. strong investment performance and ESG factor integration Morgan Stanley Research, Sustainable Reality (March 2015) 4 MORGAN STANLEY

5 Mark C. Callaway Mark C. Callaway Peter Roselle, CPM, CFP Senior Portfolio Manager Senior Portfolio Manager Portfolio Manager Senior Vice President Senior - Wealth Vice Management President-Wealth Vice President Management - Wealth Management Financial Advisor Financial Advisor Financial Advisor Alora Clark Wealth Management Analyst Mark Callaway has managed SRI/ESG/ Alora Clark is an analyst for the Indigo Mark Callaway has managed Peter Roselle has been a Certified Impact Investing style discretionary Group at Morgan Stanley. Her primary role "SRI/ESG/Impact Investing style" Financial Planner since He strategies within the Morgan Stanley includes portfolio management and discretionary strategies within the focuses on helping executives and Portfolio Management platform since analysis, research on financial and Morgan Stanley Portfolio business owners with retirement and In 2014, he was named one of sustainability factors of investments, and Management platform since In estate planning strategies and optimizing their investment portfolios Morgan Stanley s Investing with Impact searching for new opportunities to invest 2014, he was named one of Morgan Champions. In 2009, he co-founded the with impact. Stanley's Investing with Impact through sustainable investing principles. He advises both for-profit and Southeast Corporate Sustainability Champions. In 2009, he co-founded Rankings, which ranks publicly traded Prior to joining Morgan Stanley, Alora the Southeast Corporate non-profit organizations on improving the alignment of sustainable companies according to standardized completed her Masters in Quantitative and Sustainability Rankings, which ranks environmental, social and governance Computational Finance at Georgia Tech. publicly traded companies according investing principles in their investment portfolios. Peter has also scores. Mark s educational background While there, she worked on research in to standardized environmental, social includes studies in both political science Sustainable Finance and Accounting for and governance scores. Mark's educational background includes studies tion as an Investing with Impact received Morgan Stanley's recogni- and theater, as well as an MBA from the Ray C. Anderson Center for Sustainable LaGrange College. He served as an adjunct Business. She has a Bachelor of Science in in both political science and theater, Champion. He serves as Co-Vice professor, teaching Investment Analysis Applied Mathematics and Statistics from as well as an MBA from LaGrange Chair of the Sustainable Investing and Portfolio Management. In 2015, he Johns Hopkins University. College. He served as an adjunct professor, teaching Investment Analysis of Security Analysts (NYSSA), where Committee for the New York Society attended Oxford University s Impact Investing executive program. Mark holds and Portfolio Management. In 2015, he helps plan and run events designed the position of Senior Vice President of he attended Oxford University's to raise awareness of the importance Wealth Management at Morgan Stanley, Impact Investing executive program. of corporate social responsibility and a n d i s a l s o a S e n i o r I n v e s t m e n t Mark holds the position of Senior the use of environmental, social and Management Consultant, and Senior Vice President of Wealth governance factors in portfolio Portfolio Manager. Management at Morgan Stanley, and design. Peter obtained his BA in is also a Senior Investment Economics and MBA in Finance, both Management Consultant, and Senior from Seton Hall University. He Portfolio Manager. received the Certified Portfolio Manager designation in conjunction with Columbia University in THE INDIGO GROUP 5

6 Indigo Sustainable Portfolios Composition Our security selection criteria can include alignment in the strategic areas of environmental, social and governance (ESG) factors as well as ESG materiality and momentum. The Indigo team uses a new breed of ESG research that analyzes financial and nonfinancial factors which are designed to identify ESG risks or opportunities that may not be captured through conventional analyses. We use the best of Morgan Stanley's fundamental and quantitative financial research as well as in-depth ESG analysis on a number of metrics for each company. We can now review abundant research documenting the effects on corporate performance and values of nonfinancial factors, such as gender diversity, which can no longer be ignored in portfolio construction. Our portfolios are constructed of individual publiclytraded equities and exchange traded funds. We offer fossilfuel free options as well as portfolios that include a "bestin-class" approach using all sectors of the economy. We also incorporate a gender screen to ensure women are represented on the board of directors of each company in our portfolio. New research indicates that gender diversity on boards and top management teams is a material ESG 3 factor in all industries. In addition, we use technical analysis from Dorsey-Wright, a leading research provider, which evaluates the simple economics pertaining to each security. This time-tested approach offers valuable insight as a logical, organized way of assessing the forces of supply and demand. When all is said and done, if there are more buyers than sellers willing to sell, the stock price will move higher. 3. Morgan Stanley Research, Why it pays to invest in Gender Diversity (May 2016) 6 MORGAN STANLEY

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8 Environmental, Social and Governance (ESG) Integration Each client is unique; this is true regarding financial considerations as well as how our clients choose to integrate their personal values or institutional mission into portfolio construction. These "impact priorities" reflect an individual or institution s worldview, values, mission, investment objectives and more. For a growing number of our clients, integrating impact priorities into their investment decision making is increasingly important. This is the basis for Morgan Stanley s Portfolio Impact Alignment which leverages proprietary companylevel environmental, social and governance data provided by MSCI ESG Research, a third-party research firm and a market leader for companylevel ESG data. The Portfolio Impact Alignment is a point-in-time investment analysis tool that empowers clients to view their portfolio from a new perspective - through the lens of a comprehensive set of fourteen ESG metrics that are material across most industries and geographies, five exposures across key risk areas and seven themes for which a defined approach to a particular theme is available and generally accepted. Through a licensing agreement with MSCI, we build a holistic view of the significant ESG issues a company faces, as well as its industry context and peer analysis. This rating system is further designed to identify the financial relevance of ESG factors, which helps with our commitment to achieving market-rate returns. 8 MORGAN STANLEY

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10 The principals of the Indigo Group have long standing family and individual history of giving back to their communities. We support those organizations which are dedicated to inspire and motivate action towards positive change. Since 1982, the principals of the Indigo Group have offered comprehensive investment strategies for individuals and institutions. In 2001, we started offering portfolios designed with environmental, social and governance screening. In 2012, we started working closely with Morgan Stanley s Investing with Impact platform to offer our clients a broad array of solutions and services. Our diverse backgrounds in finance, philanthropy and advocacy help us provide a unique investment experience. We provide a team approach to each client that ensures our ability to provide personalized, customized advice throughout the life of the relationship. 10 MORGAN STANLEY

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12 This material does not provide individually tailored investment advice. It has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. The strategies and or investments discussed in this material may not be suitable for all investors. Morgan Stanley Smith Barney LLC recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a Financial Advisor.The appropriateness of a particular investment or strategy will depend on an investors individual circumstances and objectives Morgan Stanley Smith Barney LLC. Member SIPC /2016 CRC