At Santander TFI S.A., we realise that we can have a significant impact on society and the environment through our investment activities.

We recognise that sustainability is fundamental to the needs of our world and can require a new way of investing, while at the same time adding value to our investments.

There is consensus in the asset management industry that integrating ESG (Environmental, Social and Governance) aspects into investment decisions contributes to better risk management and the discovery of new opportunities, generating value for clients and society at large. When acting as asset managers, we are obliged as part of our fiduciary duties to always be guided by the best interest of our clients. In order to fulfil this duty, it is necessary to take into account both financial and non-financial aspects and have a more complete picture of the assets under management, which often translates into more informed investment decisions.

In response to this increasingly important global trend, we have expanded our offering with Santander Prestiż Global Responsible Investment (a sub-fund of the Santander Prestiż SFIO fund), which takes ESG criteria fully into account in the investment process and focuses on companies that demonstrate a significant correlation with high ESG standards.

We strive to pursue sustainable development and responsible business by applying global and Santander Group’s best practices and standards, which are embedded in the regulations that guide our daily work. We are aware of the fact that certain investment activities may have adverse sustainability impact and we seek, where possible, to minimise such negative impact by applying the principles described, inter alia, in the following regulations:

• General Sustainability Policy which sets out the general principles and commitments pursued by the Santander Group in the area of sustainability.
• Sustainable and Responsible Investment Policy which sets out Santander Group's sustainable and responsible investment approach and defines how ESG criteria are taken into account in the investment process.
• Policy of Engagement in Companies Listed on a Regulated Market and Application of Corporate Governance Measures on the basis of this policy, we assess the responsibility of the business conducted by the companies, as evidenced by the actions taken to secure and satisfy ESG criteria. We attach great importance to the corporate governance of companies. The policy also describes the process of dialogue with companies and the rules for exercising voting rights at general meetings of shareholders.
• Sector Risk Management Policies- pursuant to these policies, we do not invest in companies from so-called "sensitive" sectors, which include, for instance, the defence sector associated with the production, trade or distribution of, for example, anti-personnel mines, cluster bombs, chemical or biological weapons, nuclear weapons or depleted uranium munitions. The Santander Group has also declared a total reduction of exposure to coal mining and coal-fired power generation by 2030.
• Conflict of Interest Management Regulations which set out detailed rules for meeting legal, regulatory and ethical obligations relating to conflicts of interest.
• Anti-Corruption Programme- its purpose is to establish the principles applicable at Santander TFI S.A. with regard to counteracting corruption, notwithstanding any additional controls that may be required under other local regulations or requirements in this regard.
• Corporate Volunteering Policy- our employees can take part in initiatives aimed at, among other things, supporting education and scientific development, working for equal opportunities and building civil society.

Bearing in mind the impact our investment activities can have on sustainability, in July 2020 we became a signatory to the UNPRI (United Nations Principles for Responsible Investment) initiative launched with the support of the United Nations to promote responsible investment. Six general Principles for Responsible Investment are encouraged:

1. Incorporating ESG factors in investment analyses and decision-making processes,
2. Incorporating ESG factors into ownership policies and practices,
3. Seeking appropriate disclosures on issues related to ESG from the companies invested in,
4. Promoting acceptance and implementation of the Principles for Responsible Investment within the investment industry,
5. Working together to enhance the effectiveness in implementing the Principles,
6. Reporting on our activities and progress towards the implementation of the Principles.

Signing up to the internationally recognised Principles for Responsible Investment is an expression of willingness to increase our commitment to responsible investment.

Sustainability issues are a challenge for the entire financial market. They require action on the part of financial institutions, issuers and regulators alike. We are currently in the process of developing standards, including those related to disclosure of information necessary to properly manage sustainability risks. It is our intention to continue our work and actions for the sake of sustainable development.

As of 10 March 2021, Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability‐related disclosures in the financial services sector (SFDR Regulation) is in force in the countries of the European Union and requires financial market participants, including investment fund companies, to disclose the information detailed in the Regulation, inter alia, by publishing it on their websites.