thematic portfolio ab sustainable global · esg: environmental, social and governance *the ab...

First Name Last Name Position Department/Product AreaFirst Name Last Name Position Department/Product Area

CURRENT STRATEGY & REVIEW

AB SUSTAINABLE GLOBALTHEMATIC PORTFOLIO

31 December 2019

LUXFLAGLabel

This document is issued by AllianceBernstein Limited, 50 Berkeley Street, London W1J 8HA. AllianceBernstein Limited is authorised and regulated in the UK by the Financial Conduct Authority (FCA-Reference Number 147956). This information is directed solely at persons in jurisdictions where the Fund and relevant share class are registered, or who may otherwise lawfully receive it. The sale of the Fund may be restricted or subject to adverse tax consequences in certain jurisdictions. In particular, no shares may be offered or sold, directly or indirectly, in the US or to US persons, as described in the Fund’s prospectus. It is provided for marketing purposes but does not constitute investment advice or an invitation to purchase any security or other investment. The views and opinions expressed in this document are based on our internal forecasts and should not be relied upon as an indication of future market performance. Past performance does not guarantee future results. For Investment Professional use only. Not for inspection by, distribution or quotation to, the general public.

The Sustainable Global Thematic Portfolio is a portfolio of AB SICAV I, an open-ended investment company with variable capital (société d’investissement à capital variable) incorporated under the laws of the Grand Duchy of Luxembourg.

1|AB Sustainable Global Thematic Portfolio 4Q19For Investment Professional use only. Not for inspection by, distribution or quotation to, the general public.

Past performance does not guarantee future results. Logos, brands and other trademarks in this presentation are the property of their respective trademark holders. They are used for illustrative purposes only, and are not intended to convey any endorsement or sponsorship by, or association or affiliation with, the trademark holders. Investors must not rely on LuxFLAG or the LuxFLAG Label with regard to investor protection issues, and LuxFLAG shall not incur any liability related to the financial performance or default of the AB Sustainable Global Thematic Portfolio. The LuxFLAG Label has been granted through 31 March 2020. ESG: environmental, social and governance*The AB Sustainable Global Thematic Portfolio was awarded the LuxFLAG ESG Label concurrently with one other US-based manager. As of 31 December 2019Source: Label ISR and LuxFLAG

Awarded Both the Label ISR and LuxFLAG ESG LabelExternally Recognized for Excellence in Sustainable Investing

Label ISR: Saving Toward a More Sustainable WorldAwarded February 2019

LuxFLAG ESG Label: Raising Awareness of ESG Investing Awarded March 2019

The Label ISR (or SRI—Socially Responsible Investing) helps investors choose sustainable and responsible investments

Created and supported by the Finance Ministry in France, the purpose of the label is to increase the visibility of socially responsible investment products

The Label ISR aims to reconcile economic performance with social and environmental impact by facilitating investments in companies that contribute to sustainable development

LuxFLAG (the Luxembourg Finance Labelling Agency) is an independent body that raises awareness of and promotes the responsible investment industry

The ESG Label is awarded to funds that screen 100% of the portfolio using ESG criteria

AllianceBernstein is the first US-based asset manager to be awarded the ESG Label for an equity strategy*


Past performance does not guarantee future results. Holdings are subject to change.*Active share I Class vs. MSCI ACWI†Up/down capture is vs. MSCI ACWI since June 2013 (when Daniel Roarty took over the strategy)‡Beta is a measure of an investment’s sensitivity to the market as a whole. A beta below 1 indicates lower sensitivity to the market; a higher beta indicates higher sensitivity. As of 31 December 2019Source: MSCI and AB

AB Sustainable Global Thematic Portfolio: Overview

Characteristics

Index MSCI ACWI

Number of Holdings 30–60

Active Share* 85%–90%

Up/Down Capture (%)† 108/100

Beta‡ 0.95–1.10

Turnover 30%–70%

Capitalization Mid/Large

Encompassing Sustainability, ESG Integration and Management EngagementSeeking Positive Financial and Social Outcomes

Sustainable Themes

ActiveOwnership

ESGIntegration

The UN Sustainable Development Goals

(UNSDGs) are the foundation for our investment themes

We engage company management teams on material ESG issues

We consider ESG factors at each step of our

fundamental investment process


Philosophy

We seek to generate superior financial returns through investments that

contribute to positive social and environmental

outcomes.


AB Sustainable Global Thematic Portfolio: Investment Team

Investment team is subject to change.As of 31 December 2019Source: AB

Average: 20 Years of Industry Experience12 Years of Experience with AB

Ben Ruegsegger, CFATechnology19 Years of Industry Experience19 Years of Experience with ABUS

Joseph Sun, CFAConsumer Discretionary & Staples10 Years of Industry Experience9 Years of Experience with ABUS

Dave Wheeler, CFAEnergy & Industrials28 Years of Industry Experience12 Years of Experience with ABUS

William JohnstonFinancials 34 Years of Industry Experience 22 Years of Experience with ABUK

Ed Bryan, CFA Healthcare13 Years of Industry Experience13 Years of Experience with ABUK

Amy YangQuantitative Analysis7 Years of Industry Experience7 Years of Experience with ABUS

Lei QiuTechnology & Communication Services21 Years of Industry Experience8 Years of Experience with ABUS

Daniel Roarty, CFACIO27 Years of Industry Experience9 Years of Experience with ABUS


For illustrative purposes only. There can be no assurance that any investment objectives will be achieved.

Investment Process

Investment Universe~1,400 companies

Companies offering products that contribute to achieving the UNSDGs

Proprietary product identification methodology

Organized thematically Climate Health Empowerment

$1 billion+ market cap with sufficient liquidity

Attractive Candidates~400 companies

Fundamental research by sector experts emphasizes companies with superior: UNSDG Alignment Revenue Growth Profitability Management Quality

Financial modeling reflects structured evaluation of material ESG factors

Team collectively vets candidates

Portfolio ~30–60 companies

Reflect team’s highest-conviction ideas

Size positions for optimal risk/reward spread and balanced theme exposure

Disciplined risk-management and sell process

Ongoing management engagement on material ESG issues

AB Sustainable Thematic Equities


For informational purposes only Source: United Nations and AB

UN Sustainable Development Goals Serve as the Foundation for the StrategyGoals Link Social and Financial Progress

UN Sustainable Development Goals A Powerful Framework of 17 Goals and 169 Sub-Targets The UNSDGs represent an aspirational view of what

the world could look like by 2030

The 17 goals address challenges relating to: Economic prosperity Environmental sustainability Social inclusion

193 nations collectively created, and committed to achieving, the goals, signaling broad political consensus

The estimated costs to achieving the UNSDGs are massive—roughly US$90 trillion

Business alignment with the UNSDGs can enhance long-term growth potential and reduce risk

We invest exclusively in well-managed companies providing solutions to key UNSDG challenges


For informational purposes onlySource: United Nations and AB

Product Analysis Drives Universe and Theme CreationWe Have Identified Approximately 80 Sustainable Products

Proprietary Analysis Informs Investment Universe and ThemesDetailed Analysis of 169 UNSDG Sub-Targets Sharpens Investment Focus

Sustainable Products

Identify companies generating

revenues from sustainable product

sales

Group together to facilitate ongoing research and client communication

Investment Universe

Investment Themes

Most Sub-Targets Require Private-Sector SolutionsOthers Depend Primarily on Policy Support

PolicyUNSDG 5c:

“Adopt and strengthen sound policies and

enforceable legislation for the promotion of gender

equality…”

PrivateSector

UNSDG 7.2:“By 2030, increase

substantially the share of renewable energy in the

global energy mix”

63

106

Sustainable ProductsBatteries, Solar Panels, Wind Turbines, Smart-Grid Equipment and

Software

Not directlyinvestable

UNSDG Sub-targets


Sustainable Products Fit Three Primary ThemesMisaligned Products Are Excluded

For informational purposes only*We exclude direct manufacturers of these products. We exclude distributors of these products and suppliers to manufacturers of these products if their business exposure exceeds 20% of their revenues. We also monitor companies for conduct-based violations, as generally defined by the United Nations Global Compact.Source: FEW Resources, United Nations and AB

Themes Guide Capital-Allocation DecisionsThemes Reflect Most Compelling Opportunities for the Private Sector

Climate Cleaner Energy Resource Efficiency Sanitation and Recycling Sustainable Transportation

Health Access to Quality Care Food Security and

Clean Water Medical Innovation Well Being

Empowerment Educational Services Financial Security and

Inclusion Information and

Communication Technologies

Sustainable Infrastructure

Misalignments/Exclusions* Alcohol Coal Gambling Pornography Prisons Tobacco Weapons


For informational purposes only As of 31 December 2019Source: AB

Grassroots ResearchUnique Research Approach Helps Clarify Sustainable Investment Opportunities

20142013 2018GhanaNigeriaSouth AfricaThailandPhilippinesIndonesia

VietnamChinaSouth KoreaIndia

2015 2017BrazilChilePeruColombiaMexicoChina

JapanIndonesiaPhilippines

ChinaIndia

ChinaSouth Africa

2016

China (2017)

South Africa (2018)

2012 India

Indonesia (2016)

Affordable Medical Care, Enabling Technologies, Financial Inclusion, Women’s Empowerment

Enabling Technologies, Sustainable Production, Water

India (2015)

Economic Infrastructure, Enabling Technologies, Financial Inclusion, Low Carbon, Water, Women’s Empowerment

Affordable Medical Care, Financial Inclusion, Healthy Lifestyles, Women’s Empowerment

2011 InnerMongolia

2019 Tennessee


For informational purposes only*IRR: internal rate of return. This analysis targets a portfolio IRR of 12%–15% based on the weighted average of analyst estimates for individual securities in the portfolio.Source: AB

Disciplined Fundamental Research Process

Think like long-term private-equity owners to capitalize on market’s short-term focus

Sector experts develop proprietary five-year financial forecasts

Apply a conservative exit multiple to determine expected returns (IRRs)

Forward-looking risk analysis incorporates ESG and traditional risk factors

Utilize propriety mapping process to evaluate and quantify most material risks

Proprietary scoring methodology determines cost of equity

Estimate Return Potential (IRR)* Estimate Risk (Cost of Equity)

Environmental

Governance

OperationalFinancial

Time

Price

Private Equity-Like Mentality Can Improve Stock Selection

Strategic Social

Invest Based on (Return-Risk) Spread

Use the (Return-Risk) spread to assess relative stock attractiveness

Stocks with high spreads generally have stronger appeal

Target portfolio IRR of 12%–15% and (Return-Risk) spread of +300 b.p.*

Investment Attractiveness

Return

Risk

Compound Annual Return

Hurdle Rate


Historical and current analyses do not guarantee future results. This example is provided for the sole purpose of illustrating how research can be used to help identify investable ideas in the portfolio-management process, and is not to be considered a recommendation by AllianceBernstein L.P. For informational purposes only.As of 31 December 2019Source: Nav, Square and AB

SquareAffordable and Accessible Platform for Economic Growth

ThesisTheme: Empowerment Outcome

2015

2016

2017

2018

2019

2020E

2021E

2022E

2023E

050100150200250

01020304050

Percent

Gross Payment Volume EstimatesUSD (Thousands)

Return/RiskSpread of

10.8%

Hurdle Rate


The global trend away from paper toward digital payments offers substantial long-term growth

Square’s total addressable global market is estimated to be as high as $13.5 trillion by 2026

20% of the small businesses in a recent study reportedly considered shutting down, primarily because of lack of growth or cash-flow issues

53% of small businesses applied for funding or credit lines over the past five years, and more than one in four sought loans multiple times

Square’s holistic platform model, including payment processing, has increased opportunities for small businesses by allowing them to accept card payments and access small-business loans

Micro-merchant gross payment volume in 2018 was $41,953 million—over 19% YoY growth

YoY Growth (Right Scale)


For illustrative purposes only. There can be no assurance that any investment objectives will be achieved.

Alignment Between Fundamental Conviction and Risk Is Dynamically MonitoredRisk Management and Sell Discipline

No predefined formula or mechanical trading rules—all transactions require a qualified review

Fundamentals

Valuation

Portfolio Construction

Stock Risk Focus on fundamental conviction and thesis risk

Valuation (IRR–Cost of Equity Framework)

Portfolio Risk Individual stock contribution to active risk, risk boundaries and alignment with conviction

Thematic exposure

Style Risk Minimize unintended factor exposures

Emphasize idiosyncratic over style risk

ESG Risk Ensure UNSDG company alignment

Monitor for major ESG controversies

Risk Management Sell Discipline


HurdleRate


Firmwide commitment to responsible investing, leveraging the resources of nearly 200 experienced global research analysts

Proprietary technology (eSight) to document and share ESG analysis and engagement Long history of research and investment in social and environmental themes

Why AB?

Significant and underappreciated role for the private sector in achieving global sustainability Rising consumer, corporate and regulatory focus on ESG issues ESG increasingly influencing investor behavior

Why Now?

Thematic alignment with the UNSDGs links positive social and financial outcomes Deep ESG integration at all steps of investment process improves fundamental analysis Active ownership with emphasis on ESG issues positively influences management behavior

Why ABSustainable Global Thematic Portfolio?

Why AB Sustainable Global Thematic Portfolio?


PORTFOLIO REVIEW


AB Sustainable Global Thematic Portfolio

Past performance does not guarantee future results. Prior to 31 October 2018, the Portfolio was named AB Thematic Research Portfolio. All data prior to 31 October 2018 relates to the AB Thematic Research Portfolio. Returns are shown net of fees. Shares of the Portfolio are offered only pursuant to the Portfolio’s current Prospectus together with the most recent financial statements. The information on this page is for informational purposes only and should not be construed as an offer to sell, or solicitation of an offer to buy, or a recommendation for the securities of the Portfolio. Returns denominated in a currency other than that of the fund may increase or decrease as a result of foreign-exchange currency fluctuations. Source: MSCI and AB

Total Returns, Class I Shares (USD)

Periods Ended 31 December 2019

4Q 2019

OneYear

ThreeYears

FiveYears

10Years

AB Sustainable Global Thematic Portfolio 9.0% 29.3% 16.6% 9.8% 7.7%

MSCI ACWI 9.0 26.6 12.4 8.4 8.8

Relative Performance +0.0% +2.7% +4.2% +1.4% –1.1%



Past performance does not guarantee future results. Prior to 31 October 2018, the Portfolio was named AB Thematic Research Portfolio. All data prior to 31 October 2018 relates to the AB Thematic Research Portfolio. Returns are shown net of fees. Shares of the Portfolio are offered only pursuant to the Portfolio’s current Prospectus together with the most recent financial statements. The information on this page is for informational purposes only and should not be construed as an offer to sell, or solicitation of an offer to buy, or a recommendation for the securities of the Portfolio. Returns denominated in a currency other than that of the fund may increase or decrease as a result of foreign-exchange currency fluctuations.Source: MSCI and AB

Total Returns, Class A Shares (USD)

Periods Ended 31 December 2019

4Q 2019

OneYear

ThreeYears

FiveYears

10Years

AB Sustainable Global Thematic Portfolio 8.8% 28.2% 15.7% 9.0% 6.8%

MSCI ACWI 9.0 26.6 12.4 8.4 8.8

Relative Performance –0.2% +1.6% +3.3% +0.6% –2.0%


4Q:2019 (Basis Points)Attribution

Attribution by Sector* Contributors

Detractors

Materials

Technologies

Utilities

Company Sector Theme Attribution

UnitedHealth Group Healthcare Health +40

Vestas Wind Systems Industrials Climate +37

Kingspan Industrials Climate +33

Infineon Technologies Technology Climate +29

NVIDIA Technology Empowerment +28


PagSeguro Digital Technology Empowerment –70

Etsy Cons. Discretionary Empowerment –36

Hexcel Industrials Climate –30

Ecolab Materials Climate –26

Proofpoint Technology Empowerment –26

Past performance does not guarantee future results. Holdings are subject to change.*Sector attribution includes sector-allocation effect and stock-selection effect, showing top three and bottom three; numbers may not sum due to rounding.†Theme attribution is based on AB’s own theme assessment for the individual holdings in both the portfolio and benchmark. As of 31 December 2019Source: MSCI and AB

Attribution by Theme†

41

–28

48

Empowerment

Climate

Health


Trailing 12 Months (Basis Points)Attribution

Attribution by Sector* Contributors

Detractors


MSCI Financials Empowerment +113

DSM Materials Health +81

Bruker Healthcare Health +65

Bio-Rad Laboratories Healthcare Health +59

Kingspan Industrials Climate +53


Swedbank Financials Empowerment –75

Unicharm Consumer Staples Health –48

China Everbright Intl. Industrials Climate –46Bharat Financial Inclusion Financials Empowerment –41

Etsy Cons. Discretionary Empowerment –37

Financials

Technology

Communication Services

Past performance does not guarantee future results. Holdings are subject to change.*Sector attribution includes sector-allocation effect and stock-selection effect, showing top three and bottom three; numbers may not sum due to rounding.†Theme attribution is based on AB’s own theme assessment for the individual holdings in both the portfolio and benchmark. As of 31 December 2019Source: MSCI and AB

Attribution by Theme†

150

–95

276

Empowerment

Climate

Health


Geographic Exposure (Percent)

Sector weights and holdings are subject to change. For illustrative purposes only. Numbers may not sum due to rounding. Numbers are net of cash.*Estimates from MorningstarAs of 31 December 2019Source: Morningstar, MSCI and AB

4Q:2019Sector and Geographic Exposure

Sector Overview (Percent)

26.1

23.0

13.4

12.7

8.4

6.3

6.1

2.8

1.3

17.1

11.8

10.3

16.7

10.8

8.0

4.8

3.3

8.7

5.2

3.2

Technology

Healthcare

Industrials

Financials

Consumer Discretionary

Consumer Staples

Materials

Utilities

Communication Services

Energy

Real Estate

AB Sustainable Global Thematic Portfolio MSCI ACWI

US45.8

Region ofDomicile

Region of Revenue Exposure*

Developed Markets 89.5 67.4

Emerging Markets 10.5 32.6

Netherlands 8.5Japan 6.7Ireland 5.8India 4.7Denmark 4.6Switzerland 4.1China 4.1France 4.0Germany 4.0Austria 2.4Hong Kong 1.9Brazil 1.7UK 1.7


Holdings by Theme

Investment theme weightings are subject to change. References to specific securities are presented to illustrate the application of our investment philosophy only and are not to be considered recommendations by AB. The specific securities identified and described herein do not represent all of the securities purchased, sold or recommended for the fund, and it should not be assumed that investments in the securities identified were or will be profitable. Holdings are subject to change.As of 31 December 2019Source: AB

Abcam Apollo Hospitals Bio-Rad Laboratories Bruker Chr. Hansen

Danaher Gerresheimer ICON Kerry Group DSM

Philips NXP Semiconductors Tecan Unicharm UnitedHealth Group

Adyen AIA Group Alibaba Group Bright Horizons Family Solutions Charles Schwab

Erste Group Bank Flex HDFC Bank Microsoft MSCI

NVIDIA PagSeguro Digital Partners Group Proofpoint Recruit Holdings

Square Tencent Visa Zendesk

American Water Works Apple Aptiv Beijing Enterprises

China Everbright International Dassault Systèmes Ecolab Hexcel

HORIBA Infineon Technologies Keyence Kingspan

Health: 36.5%

Sub-themes: medical innovation; affordable medical care; healthy lifestyles; food security; physical safety

Empowerment: 36.8%

Sub-themes: economic infrastructure; enabling technologies; financial inclusion; women’s empowerment

Climate: 26.7%

Sub-themes: low carbon generation; energy efficiency; clean transportation; water; sanitation and recycling; sustainable production

West Pharmaceutical Services Xylem

Nike Procter & Gamble Schneider Electric Vestas Wind Systems


Past performance does not guarantee future results. *Weighted average of analyst estimated IRR and cost of equityAs of 31 December 2019Source: MSCI and AB

Strong Fundamental Characteristics

EPS GrowthPast Five Years (Percent)

16.112.7

AB Sustainable GlobalThematic Portfolio

MSCI ACWI

Portfolio Return-Risk SpreadWeighted Average (Percent)*

ROENext 12 Months (Percent)

19.014.8


MSCI ACWI

Revenue GrowthFive-Year History (Percent)

11.18.0


MSCI ACWI

10.78.4

Compound AnnualReturn (IRR)

Hurdle Rate(Cost of Equity)

Return-Risk Spread: 2.3%


OUTCOME REVIEW


Measuring Enterprise Impact

Product Im

pact*

Corporate Behavior†

MSCI ACWI

Social ValueDestruction

Social ValueCreation

Negative

Positive

Weaker Stronger

Past performance does not guarantee future results.*Product impact reflects our assessment of net revenue exposure (revenue from aligned products minus misaligned products) to the UNSDGs.†Corporate behavior score leverages MSCI ratings to assess corporate behavior relative to peers as well as changes in behavior over time.As of 31 December 2019Source: MSCI and AB

A Practical Framework for Assessing Enterprise ImpactSocial Value Creation

The Big Idea

Investors often confuse two types of impact:

Investment Impact: Did my specific investment create measurable social impact?

Enterprise Impact: Are the companies I invest in having a positive impact on society?

Only Enterprise Impact is relevant for investors, who must choose appropriate metrics to match their objectives

Firms can sell products that help (vaccines) or hurt (tobacco) society

Corporate behavior can be positive (fair gender pay) or negative (corruption and bribery)

All companies—and portfolios—can be evaluated on these two dimensions

We believe that social value creation and economic value creation are mutually-reinforcing

AB Sustainable Global Thematic

Portfolio


Tilted Toward the Most Attractive Opportunities for Private Capital

Past performance does not guarantee future results. For informational purposes only. Each UNSDG includes a series of specific targets to help assess the progress toward achieving each of the 17 goals. The Portfolio is designed to maximize exposure to the most attractive opportunities (goal or target) for private capital. Numbers are net of cash. As of 31 December 2019Source: MSCI, United Nations and AB

Measuring Allocation to UNSDGs

Allocation to UNSDGs in FundPortfolio Weight (Percent)

Goal 3 (Good Health and Well Being) and Goal 8 (Decent Work and Economic Growth) and the most common UNSDG exposures

Over 70% of our Portfolio is invested in UNSDGs: 3, 8, 7, 12 and 6

Some relevant products apply equally to multiple UNSDGs, which makes precise portfolio mapping to the UNSDGs difficult. We map our holdings in this case to one UNSDG

21.0

16.7

13.8 13.6

9.1 8.5 7.8

4.72.3 1.8

0.7


Current analysis does not guarantee future results and is for illustrative purposes only.References to specific securities are presented to illustrate the application of our investment philosophy only and are not to be considered recommendations by AB. The specific securities identified and described herein do not represent all of the securities purchased, sold or recommended for the portfolio, and it should not be assumed that investments in the securities identified were or will be profitable. Holdings are subject to change.As of 31 December 2019Source: Company reports and AB

Top Holdings: Product ImpactHow Our Companies Are Creating Social ValueSecurity UNSDG Social Contribution

NikeNike has a large opportunity to reduce its environmental footprint. Using recycled materials reduces natural resource consumption and CO2 emissions from the manufacture of newly acquired raw materials. In 2018, 65% of the materials used in Nike footwear and apparel products were recycled

Philips Philips measures how many lives it is improving by multiplying the number of people touched by its products over the lifetime of a product by the number of those products delivered in a year. This number was 1.54 billion in 2018

HDFC Bank HDFC Bank is the second largest private bank in India, providing broad financial services access to Indian consumers and small/medium-size enterprises. As of FY 2019, loans to micro, small and medium enterprises had amounted to INR 1,289.8 billion, up 44.8% YoY

Vestas Wind SystemsVestas manufactures and services wind turbines and wind farms, which help reduce carbon emissions and air pollution and increase renewable energy penetration. CO2 savings in million tonnes over the lifetime of the wind turbines it produces and ships annually grew 24% in 2018 and 213% since 2013

American Water Works AWK is the largest and most geographically diversified investor-owned water and wastewater utility company in the US. In 2018, the company reduced water use by 3.5 billion gallons year over year through conservation

Bio-Rad Laboratories Bio-Rad sells diagnostic instruments used to treat a wide array of diseases. The number of products offered in its life-science segment rose approximately 20% between 2016 and 2018, demonstrating Bio-Rad’s advancement of tools used to answer complex biological questions

West Pharmaceutical Services

WST enables more effective, consumer-friendly drug consumption via novel delivery systems and easier-to-use syringes. The company produced 41 billion components in 2017

Erste Group BankErste Group Bank actively contributes to positive social outcomes through its business operations, with a number of microfinancing and financial education programs as well as social housing initiatives. In 2018, Erste Group Bank realized €115.6 billion in household lending. This is indicative of the company’s progress toward promoting financial inclusion in Central and Eastern Europe

Kingspan Kingspan’s products improve energy efficiency, lower carbon emissions and reduce air pollution. Customer energy savings from Kingspan’s installed insulation products in 2018 was equivalent to taking 20 million cars off the road

MSCI MSCI is a direct play on ESG through its rating services. As of 2018, MSCI ESG Research had analyzed and offered ESG ratings for over 7,800 companies worldwide


We Seek Strong Relative Performance and Continuous ImprovementMeasuring ESG: Select Portfolio Metrics

Current analysis does not guarantee future results and is for illustrative purposes only. Carbon emissions are defined as tons per million dollars invested. *Female representation in executive ranks: Percentage of women on the board of directors, as reported by the company. This is updated annually by the companies. In Europe, where the company has a supervisory board and a management board, this is the percentage of women on the supervisory board. †Companies with ESG-linked executive compensation: Companies report whether their executive compensation is linked to environmental, social and governance (ESG) goals. This is updated annually by the companies.As of 31 December 2019Source: Bloomberg, MSCI Barra, S&P, Sustainalytics and AB

Social: Companies with Female Representation in Executive Ranks*Percent

Environmental: Carbon FootprintTons CO2e/USD Millions Invested

Governance: Companies with ESG-Linked Executive Compensation†

Percent

128.7

55.9

MSCI ACWI AB Sustainable Global Thematic Portfolio

24.325.6


12.011.5



Analysis provided for illustrative purposes only and is subject to revision. ESG: environmental, social and governanceAs of 31 December 2019Source: AB

Management Engagement Drives Change and Uncovers New Information ESG Engagement: 4Q 19

4Q:19 Engagement Examples Annual Engagement SummaryNumber of Engagements per Category

Environmental22

Social71

Governance70

StockESG Pillar ESG Factor

Impact on Thesis

Portfolio Action

Apollo Hospitals E, S, G Carbon Emissions, Labor

Management, Pay Neutral Maintained Position

Kerry Group S, G Opportunities in Nutrition

& Health, Pay Neutral Maintained Position

Amazon S Supply Chain Labor Standards Negative Exited

Position

Philips E, S, GCarbon Emissions,

Product Safety & Quality, Corruption & Instability

Neutral Maintained Position


AB Sustainable Global Thematic PortfolioA Word About Risk

Investment in the Fund entails certain risks. Investment returns and principal value of the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The Fund is meant as a vehicle for diversification and does not represent a complete investment program. Some of the principal risks of investing in the Fund include focused portfolio risk, turnover risk, derivatives risk, emerging markets risk, allocation risk, REITS, OTC derivatives counterparty risk and equity securities risk. These and other risks are described in the Fund’s prospectus. Prospective investors should read the prospectus carefully and discuss risk and the Fund’s fees and charges with their financial advisor to determine if the investment is appropriate for them.

This information is directed at Investment Professionals only and should not be relied upon by any other persons. It is provided for informational purposes only and is not intended to be an offer or solicitation, or the basis for any contract to purchase or sell any security, product or other instrument, or to enter into any type of transaction as a consequence of any information contained herein. The views and opinions expressed in this document are based on our internal forecasts and should not be relied upon as an indication of future market performance.

References to specific securities are presented to illustrate the application of our investment philosophy only and are not to be considered recommendations by AB. The specific securities identified and described in this presentation do not represent all of the securities purchased, sold or recommended for the portfolio, and it should not be assumed that investments in the securities identified were or will be profitable.

The value of an investment in the Fund can go down as well as up and investors may not get back the full amount they invested. Before investing in the Fund, investors should review the Fund’s full prospectus, together with the Fund’s Key Investor Information Document and the most recent financial statements. Copies of these documents, including the latest annual report and, if issued thereafter, the latest semiannual report, may be obtained free of charge by visiting www.alliancebernstein.com or by contacting the local distributor in the jurisdictions in which the Fund is authorized for distribution, or in the case of Swiss investors, from the registered office of the Swiss representative.


Important Information

An investor cannot invest directly in an index or average, and these do not include the sales charges or operating expenses associated with an investment in a mutual fund, which would reduce total returns.

MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed or produced by MSCI.

Note to Canadian Readers: AllianceBernstein provides its investment-management services in Canada through its affiliates Sanford C. Bernstein & Co., LLC and AllianceBernstein Canada, Inc.

Note to European Readers: This information is issued by AllianceBernstein Limited, 50 Berkeley Street, London W1J 8HA, it is for marketing purposes. Registered in England, No. 2551144. AllianceBernstein Limited is authorised and regulated in the UK by the Financial Conduct Authority (FCA).

Note to Austrian and German Readers: Local paying and information agents: Austria—UniCredit Bank, Rothschildplatz 1 1020 Vienna; Germany—BHF-Bank Aktiengesellschaft, Bockenheimer Landstrasse 10, 60323 Frankfurt am Main.

Note to Liechtenstein Readers: The Fund is not registered for public distribution in Liechtenstein and, accordingly, shares may only be offered to a limited group of Professional Investors, in all cases and under all circumstances designed to preclude a public solicitation in Liechtenstein. This document may not be reproduced or used for any other purpose, nor be furnished to any other person other than those to whom copies have personally been sent by AB. Neither the Fund nor the shares described therein have been subject to the review and supervision of the Liechtenstein Financial Market Authority.

Note to Swiss Readers: This document is issued by AllianceBernstein Schweiz AG, Zürich, a company registered in Switzerland under company number CHE-306.220.501. AllianceBernstein Schweiz AG is authorised and regulated in Switzerland by the Swiss Financial Market Supervisory Authority (FINMA) as a distributor of collective investment schemes. Swiss Representative & Swiss Paying Agent: BNP Paribas Securities Services, Paris, succursale de Zürich. Registered office: Selnaustrasse 16, 8002 Zürich, Switzerland, which is also the place of performance and the place of jurisdiction for any litigation in relation to the distribution of shares in Switzerland. The Prospectus, the key investor information documents, the Articles or management regulations, and the annual and semiannual reports of the concerned fund may be requested without cost at the offices of the Swiss representative.

Note to Hong Kong Readers: This document is issued in Hong Kong by AllianceBernstein Hong Kong Limited (聯博香港有限公司), a licensed entity regulated by the Hong Kong Securities and Futures Commission. This document has not been reviewed by the Hong Kong Securities and Futures Commission.

Note to Singapore Readers: This document has been issued by AllianceBernstein (Singapore) Ltd. (“ABSL”, Company Registration No. 199703364C). AllianceBernstein (Luxembourg) S.à r.l. is the management company of the portfolio and has appointed ABSL as its agent for service of process and as its Singapore representative. AllianceBernstein (Singapore) Ltd. is regulated by the Monetary Authority of Singapore. This advertisement has not been reviewed by the Monetary Authority of Singapore.



The [A/B] logo is a registered service mark of AllianceBernstein and AllianceBernstein ® is a registered service mark used by permission of the owner, AllianceBernstein L.P.

© 2020 AllianceBernstein L.P. www.AllianceBernstein.com

LF-95781-2020-01-14IC2020027

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