Performance and Portfolio Update

  • The Pax MSCI EAFE ESG Leaders Index Fund outperformed the MSCI EAFE Index (EAFE Index) during the first quarter of 2020.
  • During the quarter, international equity markets declined as COVID-19 fears contributed to worldwide market and economic uncertainty. In March, the full impact of the COVID-19 crisis came into better view, and equity markets declined rapidly, pushing volatility levels near all-time highs. The EAFE Index declined by -22.83% in the first quarter, producing its worst quarterly result over the last 30 years.1
  • Within these conditions, the Fund’s environmental, social, and governance (ESG) profile added the most to relative performance versus the EAFE Index. A chart showing performance attribution by ESG ratings over the trailing three months and since the Fund’s inception is available below. Fund holdings and its overweight allocation to the highest-rated ESG companies contributed the most to relative performance during the quarter, as well as since inception.
  • In addition, the Fund’s proprietary SmartCarbonTM approach contributed to relative performance. SmartCarbon substitutes energy efficiency companies in place of fossil fuel companies. Both aspects of this approach, no exposure to the Energy sector and overweight exposure toward energy efficiency companies, helped performance. Also, our avoidance of companies not meeting minimum ESG thresholds and companies involved in the manufacturing or sale of weapons helped performance.
  • From a sector perspective, Heath Care selections added to the Fund’s relative performance, driven by Fund holdings in Pharmaceuticals (Roche and Novo Nordisk) and Biotech (CSL Limited). No allocation to Metals & Mining companies within the Materials sector also aided performance.
  • Also adding to relative return during the quarter were Fund holdings within the Information Technology sector, led by strong results from two companies providing energy efficiency solutions: ASML and Keyence.
  • Detracting the most from relative performance were holdings in Real Estate, driven by poor results within the Multi-Utilities sub-sector. An underweight allocation and selections in Consumer Staples also hurt relative performance, led by lower exposure to Food Products and holdings in Food & Staples Retailing.
  • Also detracting from performance were several holdings within the Financials sector, which was the second worst performing sector in the EAFE Index, down -31.6% during the quarter. Companies in the Insurance industry: Allianz, AXA, Legal & General and Munich Reinsurance underperformed other holdings within this sector.
  • On a regional basis, the European and Pacific region added the most to relative performance compared to the EAFE Index. Within Europe, companies with leading ESG profiles in the UK, Netherlands and France outperformed, and within the Pacific region, holdings in Japan and Australia helped relative performance.


(as of 3/31/20)
1-MonthQuarterYTD1 Year3 Year5 Year10 YearSince Inception3
Pax MSCI EAFE ESG Leaders Index Fund - Investor Class-13.59-21.30-21.30-11.40-1.40-0.74-2.02
Pax MSCI EAFE ESG Leaders Index Fund - Institutional Class-13.51-21.20-21.20-11.05-1.12-0.49-2.29
MSCI EAFE ESG Leaders (Net) Index-12.20-21.00-21.00-10.47-0.860.07-2.76
MSCI EAFE (Net) Index-13.35-22.83-22.83-14.38-1.82-0.62-1.84
Lipper International Large-Cap Core Funds Index-16.51-25.73-25.73-18.22-4.13-2.08-0.84

Performance data quoted represent past performance, which does not guarantee future results. Investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For most recent month-end performance information, call 800.767.1729 or visit

Figures include reinvested dividends, capital gains distributions and changes in principal value.

3The inception date for the Pax MSCI EAFE ESG Leaders Index Fund Institutional Class is January 27, 2011, and the Investor Class inception date is March 31, 2014.

As of 5/1/19 prospectus, total annual Pax MSCI EAFE ESG Leaders Index Fund operating expenses, gross of any fee waivers or reimbursements, for Investor Class and Institutional Class shares are 0.80% and 0.55%, respectively.

Performance Attribution

ESG Ratings

(as of 3/31/20)
Average Active Weights (%)
3-month Relative Contribution (%)Since Inception 1/27/11
Relative Contribution (%)

XOther: ETFs (for short-term cash mgmt. purposes) and Cash & Equivalents.
Past performance is no guarantee of future results.

Portfolio Characteristics

(as of 3/31/20)
Market Cap (weighted avg.)$50,589M$57,828M
Forward Price/Earnings14.3313.53
Number of Securities304917

1 Source FactSet.

Top 10 Holdings

(as of 3/31/20)
Roche Holding AG 3.7%, ASML Holding NV 2.3%, SAP SE 2.2%, Novo Nordisk A/S, Class B 1.7%, GlaxoSmithKline PLC 1.6%, Siemens AG 1.5%, CSL, Ltd. 1.3%, Sony Corp. 1.3%, Unilever NV 1.2% and L’Oreal SA 1.2%. Holdings are subject to change.


MSCI ESG Research evaluates companies’ ESG characteristics and derives corresponding ESG scores and ratings. Companies are ranked by ESG score against their sector peers to determine their eligibility for the MSCI ESG indices. MSCI ESG Research identifies the highest-rated companies in each peer group to meet the float-adjusted market capitalization sector targets. The rating system is based on general and industry-specific ESG criteria, assigning ratings on a seven-point scale from AAA (highest) to CCC (lowest).
ƒWeighted Average is an average in which each quantity to be averaged is assigned a weight. These weightings determine the relative importance of each quantity on the average.
Forward Price-Earnings Ratio or P/E FY1 ratio is a ratio for valuing a company that measures its current share price relative to its per-share earnings over the next 12 months.
Return on Equity: The amount of net income returned as a percentage of shareholders’ equity. Return on equity measures a corporation’s profitability by revealing how much profit a company generates with the money shareholders have invested.
A historical Beta is used for funds with greater than two years of performance history under the same mandate. Five year Beta is used. Beta reflects the sensitivity of a fund’s return to fluctuations in its benchmark; a beta for a benchmark is 1.00: A beta greater than 1.00 indicates above-average volatility and risk.

The statements and opinions expressed are those of the author as of the date of this report. All information is historical and not indicative of future results and subject to change. This information is not a recommendation to buy or sell any security. Past performance does not guarantee future results.

PAX009191 (7/20)

Scott LaBreche

Portfolio Manager

Scott LaBreche is Portfolio Manager & VP, Portfolio Analytics, at Impax Asset Management LLC, the North American division of Impax Asset Management Group and investment adviser to Pax World Funds.

Scott is a Portfolio Manager of the Global Women’s Leadership Strategy, which includes the Pax Ellevate Global Women’s Leadership Fund. He is also a Portfolio Manager of the Pax International Sustainable Economy Fund, the Pax Global Sustainable Infrastructure Fund and the Pax U.S. Sustainable Economy Fund.

He is responsible for portfolio management of systematic strategies, portfolio analytics and risk oversight, and quantitative ESG research.

Before joining Impax in 2007, Scott was a Securities Fund Analyst at Lincoln Financial Group. He has been in the investment management industry since 1999.

Scott holds a Bachelor of Science in business administration and a Master of Business Administration with advanced certificate in finance from Southern New Hampshire University.

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