Sustainability investing is a choice. Investors decide whether aligning their investment decisions with their environmental values is right for them. At Dimensional, we believe that choice should not have to come at the expense of sound investment principles.

We also hold a unique view of corporate responsibility applied to the environment. We believe both the supply and demand sides of markets share this responsibility. With the understanding that companies operate to meet demand, we believe that, all else being equal, a sustainability investing strategy should generally reward companies for acting in more environmentally responsible ways than their industry counterparts. This belief is in contrast to many other sustainability investing approaches that exclude entire industries regarded as the worst offenders. These approaches do not consider how companies and consumers indirectly contribute to climate change by purchasing products from those industries, or that certain companies may be taking actions to reduce their environmental impact.

Consistent with our views on corporate responsibility and investing, Dimensional’s sustainability strategies place greater emphasis on companies considered to be acting in more environmentally responsible ways while also emphasizing higher expected return securities. This approach enables investors to pursue their environmental goals within a highly diversified and efficient investment strategy.

Applying Sustainability to Investing

Dimensional’s goal in designing sustainability strategies is to address the sustainability issues important to investors while still providing broad diversification and emphasis on securities with higher expected returns. To meet this goal, Dimensional’s sustainability strategies integrate sustainability considerations within a robust investment solution that pursues higher expected returns through increased weighting to smaller market cap, lower relative price, and higher profitability securities.1

Sustainability Considerations

Dimensional’s sustainability strategies systematically evaluate companies across industries on key sustainability issues, including the primary sustainability impact considerations of high greenhouse gas emissions or potential emissions from reserves of fossil fuels such as coal, oil, and natural gas that may produce those emissions. In addition, we may consider other factors we believe to be important to investors interested in sustainability, such as land use, biodiversity, involvement in toxic spills or releases, operational waste, water management, factory farming, cluster munitions, tobacco, and child labor, among other factors.

This information is not meant to constitute investment advice, a recommendation of any securities product or investment strategy (including account type), or an offer of any services or products for sale, nor is it intended to provide a sufficient basis on which to make an investment decision. Investors should consult with a financial professional regarding their individual circumstances before making investment decisions.

1. Relative price as measured by the price-to-book ratio; value stocks are those with lower price-to-book ratios. Profitability is a measure of current profitability, based on information from individual companies’ income statements

Diversification does not eliminate the risk of market loss. There is no guarantee strategies will be successful. Risks include loss of principal and fluctuating value. Environmental and social screens may limit investment opportunities for the fund. These risks are described in the Principal Risks section of the prospectus.