Methodology Change | Solactive Clean Water Industry v2 Index | Effective Date 15/08/2025

Today, on the 11/08/2025, Solactive announces the following changes to the methodology of the following indices (the ‘Affected Indices’):

Rationale for Methodology Change

Solactive has determined that pursuant to the Market Consultation announced on March 20^th, 2025, and after feedback from market participants, in order to align with the proposed ESMA regulations Solactive will enact the following changes to facilitate compliance with the new requirements for specific naming conventions for funds linked to the Solactive Clean Water Industry v2 Index that are marketed to investors within Europe.

Changes to the Index Guideline

The following Methodology changes are proposed in the following points of the Index Guideline 2.2 Selection of the Index Components:

From:

Based on the Index Universe, the initial composition of the Index as well as any selection for an ordinary rebalance is determined on the Selection Day in accordance with the following rules (the “Index Component Requirements“):

The selection is done based on screening of publicly available information such as financial news, business profiles, and company publications using ARTIS®, Solactive’s proprietary natural language processing algorithm.

Using keywords that describe the index theme, ARTIS® identifies companies that have or are expected to have significant exposure to the provision of products and/or services that contribute to the clean water industry.

The algorithm then ranks the companies according to the frequency with which the company is referenced in relation to the specific keywords (“Index Score”). Companies are only eligible if they generate at least 50% of their revenues from clean water industry related business operations. This may include companies involved in:

1. Industrial water treatment, recycling (including water reclamation), purification, and conservation
2. Water storage, transportation, metering, and distribution infrastructure
3. Production of household and commercial water purifier and heating products
4. Provision of consulting services identifying and implementing water efficiency strategies at the corporate and municipal levels.

The companies selected after completion of the above steps will be evaluated on the criteria outlined below. The evaluation is based on data provided by the Data Provider:

• UN Global Compact Principles
  • Non-Compliance with the UNGC

• Controversial Weapons
  • Companies involved in the production development or maintenance of Anti-personnel Mines, Biological or chemical weapons, Cluster munitions, Depleted uranium, Nuclear Weapons, or any other weapon that violate humanitarian principles through normal use
  • Companies that produce or develop key and dedicated components for controversial weapons
  • Companies involved in the production and/or services tailor made for the defence industry or the military
  • Companies that hold ≥20% stake in a company that is involved in controversial weapons
  • Companies currently ≥ 50% owned by a company that is involved in controversial weapons
• Small Arms
  • >5% of their revenue from the production or distribution of arms, both public and private
• Thermal Coal
  • 10% revenues from the exploration mining or refining of thermal coal
  • Companies that base 30% or more of their operations on thermal coal
  • Companies that produce >20 million tons of thermal- coal annually and are actively expanding
• Conventional Oil & Gas
  • >5% revenue from conventional oil and gas production, including natural gas, petroleum, and crude oil
  • Companies building or operating pipelines that significantly facilitate export of conventional oil and gas
• Unconventional Oil & Gas
  • >5% revenues from unconventional oil and gas production, including revenues from oil sands, oil shale, shale gas and oil and gas production in the arctic regions
  • Companies building or operating pipelines that significantly facilitate export of unconventional oil and gas
• Palm Oil
  • Companies that are involved in systematic unsustainable palm oil production
• Prisons
  • Private companies that are involved in management or ownership of prisons
• Adult Entertainment
  • >0% revenue from production of adult entertainment
  • >5% revenues from the distribution of adult entertainment
• Recreational Cannabis & Tobacco
  • >5% revenues from recreational cannabis
  • >0% revenues from tobacco manufacturing
  • >5% revenue from tobacco distribution and/or sale of tobacco products
• Alcohol
  • >0% revenues from the production of alcoholic beverages including ingredients solely used in alcoholic beverages
  • >5% revenues from the distribution of alcoholic beverages or alcoholic related services
• Gambling
  • >0% revenues from owning or operating gambling establishments
  • >5% revenues from providing supporting products/services to gambling operations

>5% revenues from manufacturing specialized equipment used exclusively for gambling

(…)

To:

Based on the Index Universe, the initial composition of the Index as well as any selection for an ordinary rebalance is determined on the Selection Day in accordance with the following rules (the “Index Component Requirements“):

The selection is done based on screening of publicly available information such as financial news, business profiles, and company publications using ARTIS®, Solactive’s proprietary natural language processing algorithm.

Using keywords that describe the index theme, ARTIS® identifies companies that have or are expected to have significant exposure to the provision of products and/or services that contribute to the clean water industry.

The algorithm then ranks the companies according to the frequency with which the company is referenced in relation to the specific keywords (“Index Score”). Companies are only eligible if they generate at least 50% of their revenues from clean water industry related business operations. This may include companies involved in:

5. Industrial water treatment, recycling (including water reclamation), purification, and conservation
6. Water storage, transportation, metering, and distribution infrastructure
7. Production of household and commercial water purifier and heating products
8. Provision of consulting services identifying and implementing water efficiency strategies at the corporate and municipal levels.

The companies selected after completion of the above steps will be evaluated on the criteria outlined below. The evaluation is based on data provided by the Data Provider:

• UN Global Compact Principles
  • Non-Compliance with the UNGC.

• Controversial Weapons
  • Companies involved in the production development or maintenance of Anti-personnel Mines, Biological or chemical weapons, Cluster munitions, Depleted uranium, Nuclear Weapons, White Phosphorous weapons or any other weapon that violate humanitarian principles through normal use.
  • Companies that produce or develop key and dedicated components for controversial weapons.
  • Companies that hold ≥20% stake in a company that is involved in controversial weapons.
  • Companies currently ≥ 50% owned by a company that is involved in controversial weapons.
• Conventional Weapons
  • Companies involved in the production and/or maintenance of conventional weapons or military products designed for lethal use.
  • Companies that hold ≥20% stake in a company that is involved in conventional weapons or military products designed for lethal use.
  • Companies currently ≥ 50% owned by a company that is involved in conventional weapons or military products designed for lethal use.
• Small Arms
  • >5% of their revenue from the production or distribution of arms, both public and private.
• Thermal Coal
  • >1% revenues from exploration, mining, extraction, distribution or refining of hard coal and lignite
  • Companies that base 30% or more of their operations on thermal coal.
  • Companies that produce >20 million tons of thermal coal annually and are actively expanding.
• Conventional & Unconventional Oil
  • >5% revenue from exploration, extraction, distribution or refining of conventional & unconventional oil.
  • Companies building or operating pipelines that significantly facilitate export of conventional & unconventional oil.
• Fossil-Based Gaseous Fuel
  • >5% revenues from exploration, extraction, manufacturing or distribution of fossil-based gaseous fuels.
  • Companies building or operating pipelines that significantly facilitate export of fossil-based gaseous fuels.
• Power Generation
  • >5% revenue from electricity production with a greenhouse gas intensity exceeding 100 g CO2e/kWh, including but not limited to generation from thermal coal, conventional and unconventional oil, natural gas, peat, and non-sustainable biomass and biofuels.
• Palm Oil
  • Companies that are involved in systematic unsustainable palm oil production
• Prisons
  • Private companies that are involved in management or ownership of prisons
• Adult Entertainment
  • >0% revenue from production of adult entertainment
  • >5% revenues from the distribution of adult entertainment
• Recreational Cannabis & Tobacco
  • >5% revenues from recreational cannabis
  • >0% revenues from tobacco manufacturing
  • >5% revenue from tobacco distribution and/or sale of tobacco products
• Alcohol
  • >0% revenues from the production of alcoholic beverages including ingredients solely used in alcoholic beverages
  • >5% revenues from the distribution of alcoholic beverages or alcoholic related services
• Gambling
  • >0% revenues from owning or operating gambling establishments
  • >5% revenues from providing supporting products/services to gambling operations
• >5% revenues from manufacturing specialized equipment used exclusively for gambling

(…) 

Defined terms used in this announcement, but not defined herein, have the meaning assigned to them in the respective index guideline of the Affected Indices. The amended version of the index guideline will be available on the effective date.