Ethical Conservative Balanced Fund

Please note, the Ethical Diversified Fund has now been renamed the Ethical Conservative Balanced Fund.

Income, growth and diversification

One of the advantages of the Uniting Financial Services Ethical Conservative Balanced Fund (“Ethical Conservative Balanced Fund”) is that you receive both an income stream, as well as capital growth over time. These are delivered within a robust ethical framework, with the aim of maximising returns and managing risk. The Ethical Conservative Balanced Fund is a more diversified investment option than alternatives such as buying an investment property. While still delivering an income stream, it also provides access to specialised investment classes typically not available to smaller investors. This approach aims to provide a total return over the medium to long term by the cash rate plus 2-3% pa, over a rolling 5 year period.

Distributions paid quarterly or reinvested at your choice

• Minimum investment of $500,000, or such lesser amount as agreed with the Trustee
• Recommended timeframe is 3 to 5 years
• Distributions are calculated quarterly
• No entry or exit fees
• Statements issued quarterly

Direct your investment

Distributions can be reinvested as additional units in the Fund or directed to a bank account of your choice, which is handy for maintaining a regular cash flow. Further, additional monies can be added to the investment, and provided monies are received by the last business day of the month, the unit price for that month will be given.

Access your money early

While the Ethical Conservative Balanced Fund is designed as a medium to longer term investment (three to five years), you are able to access your funds if your circumstances change. If you do need to access your money, three months’ notice of withdrawal is required.

Overview

Important information

The Information Document for the Ethical Conservative Balanced Fund dated 13th January 2017 is issued by The Uniting Church (NSW) Trust Association Limited ACN 000 022 480 (“Trustee”, “UCTAL”) trading as Uniting Financial Services (“UFS”). The Information Document for the Ethical Conservative Balanced Fund has not been, and is not required to be, issued in the form of a product disclosure statement or lodged with the Australian Securities and Investments Commission (“ASIC”) under the Corporations Act (“Act”). The Ethical Conservative Balanced Fund has not been, and is not required to be, registered as a managed investment scheme under the Act. Neither the Fund, any interest in the Fund, the Trustee, this document or any offer contained in this document or in relation to the Fund has been approved or examined by ASIC. Investments are designed for investors who wish to promote religious and charitable purposes and for whom profit considerations are not of primary importance in their decision to invest. Investors may be unable to get some or all of their money back when the investor expects or at all and the investment is not comparable to investments with banks, finance companies or fund managers. The Ethical Conservative Balanced Fund is available only to wholesale/sophisticated investors.

Investment objective

The Ethical Conservative Balanced Fund is designed for investors looking for a higher return investment option than short term interest rates offer. The Ethical Conservative Balanced Fund seeks to optimise and a steady income returns over the long term (3 to 5 years) by investing in a range of asset classes and securities: (i) that are assessed to have above average prospects of performing well over relevant time periods, and (ii) that comply with the Ethical and ESG Policy (“Ethical Policy”) of the Uniting Church of Australia Synod of NSW & ACT. The Ethical Conservative Balanced Fund aims to deliver total return (income and capital growth) after costs and before tax of 2%-3% above the RBA’s official cash rate on a rolling 5 year basis. The Fund has selected multiple investment managers whose styles are aligned with this objective. These managers may include UFS as an in-house manager.

Benefits of investing in the Ethical Conservative Balanced Fund

The Fund provides investors with access to a diversified portfolio which is actively and ethically managed. It offers the potential of relatively stable, risk adjusted returns above cash. It achieves this through the use of active management of both the asset allocation and of individual asset classes, within a robust risk management framework.
Ethical management is undertaken in accordance with the Ethical and ESG Investment Policy of the Uniting Church in Australia Synod of NSW & ACT. The policy is to avoid making investments which encourage or profit from activities which create goods or services that have unacceptable harmful effects on people or the environment which cannot be avoided by prudent, practical controls. This involves both screening out certain activities that are excluded under the Ethical and ESG Investment Policy and intentionally seeking investments that have positive environmental or social impacts, while delivering returns consistent with the overall objectives of the Fund.
Risk management strategies assist the Fund by seeking to minimise investment losses in potentially adverse investment environments. Risk is managed primarily through diversification, hedging and active asset allocation and security selection. Risk management does not guarantee that losses will not occur.

Diversification is achieved through:

• constructing a portfolio made up of several different asset classes such as shares, credit, cash, fixed income, property, infrastructure and alternative assets, in both Australian and international markets; and
• management within each asset class with appropriate diversification across sectors and the number of individual exposures, limits on individual risks and cross-correlations of expected performance outcomes.

Active asset allocation involves intentionally reweighting the Fund’s portfolio across the range of asset classes in order to take advantage of opportunities arising from market movements and mispricing, with the aim of maintaining a portfolio relevant to the current investment environment.

Minimum suggested investment timeframe

The minimum suggested investment timeframe for the Ethical Conservative Balanced Fund is 3 to 5 years. What this means is that over shorter periods the return of the Fund will often be below the objective, but that there is a reasonable expectation that over 3 to 5 years, it will be attained. That outcome is not guaranteed, however. The minimum suggested timeframe is a general guide only and the Trustee does not guarantee that the performance objective will be achieved over any 3 to 5 year period.

Investment Managers

Uniting Financial Services is the overall manager of the Ethical Conservative Balanced Fund, as well as the in-house manager for Australian Commercial Mortgages, Australian Fixed Income and Cash. The Australian Commercial Mortgages portfolio is an apportionment of UFS’s larger commercial mortgages portfolio. The allocation of this portfolio to the Fund is based on the asset allocation ranges as specified in the Information Document.

Uniting Financial Services is not a corporatised financial services company or a bank. It’s a religious charitable organisation made up of two Uniting Church entities: The Uniting Church (NSW) Trust Association Limited and The Uniting Church in Australia Property Trust (NSW) to form and provide Treasury and Investment Services.
For more than 80 years we’ve been providing income to The Uniting Church in Australia’s Synod of NSW and the ACT, directly contributing to the Uniting Church’s mission and service to communities in need, as well as supporting church life and congregations. Our professional and prudent approach to investing has helped us build our funds under management from just over $400 million fifteen years ago, to more than $1.25 billion today.
When it comes to individual wealth creation and caring for communities, we’re not for one or the other: we’re for both. Some call what we do ethical or socially responsible investing. We call it Ideal Investing. For us, effective financial management benefits both the individual and their community, and serving one need never compromise the interests of the other.
Ideal Investing is at the heart of everything we do and is reflected in our mission, beliefs, goals and vision.

Pendal Institutional Limited (Pendal) is a ‘multi-boutique’ global investment management business operating without a ‘house view’. Pendal is focused on delivering superior investment returns for its clients through active management across a range of Australian and international investment choices including shares, property securities, fixed income and cash strategies, as well as multi-asset and responsible investments.
Pendal has a proud 35-year heritage in and ongoing commitment to leadership in responsible investment (RI). Committed to RI, Pendal assumed full ownership of dedicated ESG research, engagement and advisory team Regnan in 2019.
Pendal is a wholly owned subsidiary of Pendal Group Limited. With $135.7 billion* in funds under management (as at 31 December 2021), Pendal Group Limited is one of Australia’s largest and most enduring pure investment managers (ASX: PDL), with a market capitalisation of around $2.6 billion.
*Includes J O Hambro Capital Management and Thompson, Siegel & Walmsley (TSW) assets under management.

AXA Investment Managers (AXA IM) is a responsible asset manager, actively investing for the long-term to help its clients, its people and the world to prosper. AXA IM’s high conviction approach enables it to uncover what it believes to be the best global investment opportunities across alternative and traditional asset classes, managing approximately A$1.415 trillion in assets as at the end of September 2021.
AXA IM is a leading investor in green, social and sustainable markets, managing A$929bn billion of ESG-integrated, sustainable or impact assets (as at the end of September 2021).
The group is committed to reaching net zero greenhouse gas emissions by 2050 across all its assets, and integrating ESG principles into its business, from stock selection to its corporate actions and culture. Its goal is to provide clients with a true value responsible investment solution, while driving meaningful change for society and the environment.
At end of June 2021, AXA IM employs over 2,488 employees around the world, operates out of 26 offices across 20 countries and is part of the AXA Group, a worldwide leader in insurance and asset management.

Mirova is a conviction-based management company that offers its clients investment solutions combining the search for financial performance with environmental and social impact.
The Mirova Global Sustainable Equity Fund is a high conviction all-cap global equity strategy focused on integrating sustainability, with the goal of outperforming the MSCI World (ex- Australia) Index. The managers take a thematic approach, investing in companies that should benefit from their exposure to long-term trends shaping the economy over the next decade across demographic, environmental, technological and governance transitions. A strict buy and sell discipline focused on fundamental quality, sustainability, and valuation leads to a low turnover, high active share portfolio of 40-60 names.
The Portfolio aims to maximize exposure to companies with positive impact on the UN Sustainable Development Goals (‘SDGs’), maintain coherence with a 2°C global warming scenario and draws on the expertise of Mirova’s multi-disciplinary investment specialists with complementary backgrounds and Mirova’s Sustainability Research Team, fully dedicated to thematic and ESG research.

PIMCO is one of the world’s premier fixed income investment managers. With its launch in 1971 in Newport Beach, California, PIMCO introduced investors to a total return approach to fixed income investing. In the 50 years since, PIMCO has worked relentlessly to help millions of investors pursue their objectives incorporating ESG factors – regardless of shifting market conditions.
As active investors, PIMCO’s goal is not just to find opportunities, but to create them. To this end, it remains firmly committed to the pursuit of its mission: delivering superior investment returns, solutions and service to clients.
As at 31 December 2021, PIMCO manages US$2.2 trillion in assets.

Plato Investment Management (Plato) is an investment management firm specialising in objective-based investment solutions for investors.
Plato was founded in Sydney, Australia, in 2006 and is majority owned and operated by its investment staff. Plato is supported by its minority equity partner, Pinnacle Investment Management Limited (‘Pinnacle’), a leading multi-affiliate investment management firm.
Plato’s philosophy is centred on the belief that the market is inefficient. These market inefficiencies are derived from informational, behavioural and structural sources. Some of these sources of return are exploited on a long-term, strategic time horizon and others are extracted on a short-term, tactical basis.
Plato Investment Management Limited (Plato) recognises its duty to behave responsibly in its business activities and towards those whom its actions affect. Plato’s views on ESG are consistent with and support the 10 Principles of the United Nations Global Compact.

EG is an Australian, data-driven investment manager committed to building in good to its $5.3 billion real estate portfolio and $3.9 billion development pipeline*. EG’s success generating outstanding returns has been underpinned by its philosophy to create lasting positive social and environmental impact for all stakeholders through technology-enhanced investing, connected communities and a high-growth culture.
Founded in 2000, EG offers a range of services including funds management, developments, urban planning advisory and private wealth management. Having consistently outperformed market returns, EG’s better path to better returns has carefully balanced risk and return using proprietary risk-management software PRISMS®.
EG runs the High Income Sustainable Office Trust (HISOT) for UFS. This core-plus fund invests in improving the environmental and social performance of existing buildings using a quantifiable framework that benchmarks portfolio success.
*As at February 2022

AMP Capital is a global investment manager with AUM of A$177.8 billion as of 31 December 2021. In April 2021, AMP Limited announced the intention to demerge AMP Capital’s private markets businesses of Infrastructure and Real Estate to create a leading global investment manager with a strong track record in differentiated private markets asset classes and leverage these capabilities to expand into attractive growth adjacencies. As part of the demerger preparations, in February 2022, AMP Capital announced a new brand name for the separated business as Collimate Capital and is on track to list on the Australian Stock Exchange in the first half of 2022.
The AMP Capital Diversified Infrastructure Trust invests in a diversified portfolio of infrastructure assets that aims to generate stable long-term returns. The fund primarily targets mature unlisted infrastructure assets in Australia and New Zealand with diversified exposure to transport links (e.g. roads and railways), transport nodes (e.g. airports and ports), energy and utilities (e.g. electricity, gas and water) and social infrastructure (e.g. health and education). Environmental, social and governance policies are used to guide investment decisions and ongoing management of the portfolio.

Palisade is an Australian specialist infrastructure investment manager with $3.4 billion in funds under management and commitments.
Palisade is majority owned by its directors and staff, with minority ownership and support provided by Pinnacle Investment Management Limited. Palisade acquires and actively manages high-quality unlisted infrastructure assets for its flagship funds, Palisade’s Diversified Infrastructure Fund, Palisade’s Australian Social Infrastructure Fund and Palisade’s Renewable Energy Fund, as well as for its Direct Investment Mandate clients.
Palisade currently manages equity investments across a range of sectors including airports, ports, renewable power generation, transmission, social infrastructure, agri-infrastructure and alternative waste treatment.

Edstart is an innovative consumer financier committed to providing access to quality education by helping individuals and families fund their education costs in a sustainable, flexible and low-cost manner, with a principal and interest line of credit.
Its lending product is only available to clients of a high credit quality with children already attending non-government schools. Typically, customers are dual-income homeowners with combined income of greater than $150,000 p.a. who are assessed as creditworthy by Edstart’s proprietary credit model.
Edstart lends its own capital and sources wholesale funding from banks and institutional investors.

IFM Investors was established more than 25 years ago by a group of Australian industry superannuation funds to protect and grow the long-term retirement savings of its members.
Its investment strategy centres on the ownership and operation of community infrastructure, and holdings in four asset classes – Infrastructure, Debt, Listed Equities and Private Equity. Backed by more than 25 years of infrastructure investment experience, today IFM’s team of over 100 infrastructure specialists manages investments across 34 portfolio companies that collectively employ in excess of 50,000 people.
IFM supports the Paris Agreement goal to limit the rise of global temperature and is proactively working with its assets to lower greenhouse gas emissions, targeting net zero carbon emission by 2050. IFM Investors invests on behalf of pension funds that collectively manage the retirement savings of more than 120 million working people worldwide.