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Name | Symbol | Market | Type |
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Xtrackers MSCI USA Esg Leaders Equity ETF | AMEX:USSG | AMEX | Exchange Traded Fund |
Price Change | % Change | Price | High Price | Low Price | Open Price | Traded | Last Trade | |
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0.80 | 1.56% | 52.06 | 52.11 | 51.6199 | 51.75 | 12,390 | 21:15:00 |
Xtrackers Municipal Infrastructure Revenue Bond ETF |
NYSE Arca, Inc.: RVNU |
Xtrackers Municipal Infrastructure Revenue Bond ETF | |
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Fund Details | |
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Ticker: RVNU | Stock Exchange: NYSE Arca, Inc. |
Management fee 1 | 0.15 |
Other Expenses | None |
Total annual fund operating expenses | 0.15 |
1 Year | 3 Years | 5 Years | 10 Years | |
$15 | $48 | $85 | $192 |
Prospectus October 1, 2019, as revised June 1, 2020 | 1 | Xtrackers Municipal Infrastructure Revenue Bond ETF |
Prospectus October 1, 2019, as revised June 1, 2020 | 2 | Xtrackers Municipal Infrastructure Revenue Bond ETF |
Prospectus October 1, 2019, as revised June 1, 2020 | 3 | Xtrackers Municipal Infrastructure Revenue Bond ETF |
Prospectus October 1, 2019, as revised June 1, 2020 | 4 | Xtrackers Municipal Infrastructure Revenue Bond ETF |
Prospectus October 1, 2019, as revised June 1, 2020 | 5 | Xtrackers Municipal Infrastructure Revenue Bond ETF |
Prospectus October 1, 2019, as revised June 1, 2020 | 6 | Xtrackers Municipal Infrastructure Revenue Bond ETF |
Returns | Period ending | |
Best Quarter | 5.23% | March 31, 2014 |
Worst Quarter | -4.93% | December 31, 2016 |
Year-to-Date | 7.00% | June 30, 2019 |
Inception Date |
1
Year |
5
Years |
Since
Inception |
|
Returns before tax | 6/4/2013 | -0.43 | 5.46 | 3.84 |
After tax on distributions | 6/4/2013 | -0.43 | 5.46 | 3.84 |
After tax on distributions and sale of fund shares | 6/4/2013 | 0.85 | 4.95 | 3.65 |
Solactive Municipal Infrastructure Revenue Bond Index (reflects no deductions for fees, expenses or taxes) | 0.03 | 6.01 | 4.11 | |
S&P Municipal Bond Revenue Index (reflects no deductions for fees, expenses or taxes) | 1.29 | 4.59 | 3.44 |
Prospectus October 1, 2019, as revised June 1, 2020 | 7 | Xtrackers Municipal Infrastructure Revenue Bond ETF |
Prospectus October 1, 2019, as revised June 1, 2020 | 8 | Fund Details |
■ | Subject to a public offering; |
■ | Amount outstanding of each bond must be at least |
■ | $40 million where, subject to the following additional conditions: |
■ | Bonds with an amount outstanding of less than |
■ | $100 million may only be included if they are issued after January 1, 2012. |
■ | Bonds with an amount outstanding of more than |
■ | $100 million may be included regardless of issue date. |
■ | Deal size of at least $100 million; |
■ | Federal tax free (bonds subject to the AMT and state and local taxes) may be included in the Solactive Municipal Infrastructure Revenue Bond Index without limit; |
■ | Investment-grade rating by either Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc.; |
■ | Fixed-rate coupon payment (zero coupon bonds may not be included in the Solactive Municipal Infrastructure Revenue Bond Index); |
■ | Bonds must not be pre-refunded / escrowed to maturity; |
■ | Time to maturity must be at least 10 years or longer; |
■ | Callable securities must not be callable within the next 5 years (the next call date must not lie in the next 5 years); |
■ | Purpose of the bond proceeds must be for one of the following areas: |
■ | Transportation (airports, seaports, bridges, toll roads, tunnels, parking facilities, or similar) |
■ | Recreation (convention centers, stadiums, sports complexes, or similar) |
■ | Utility (electric public power, water/sewer, sanitation, or similar) |
■ | Industrial Economic Development (solid waste recovery, malls, shopping centers, or similar) |
■ | The following industries are excluded: higher education, pollution control, housing, healthcare and tobacco; |
■ | Proceeds of debt must be used for infrastructure purposes and principal and interest repayment must come from a pledged revenue source (e.g. tolls, sales tax, registration fees, user fees) or a double-barreled revenue stream (pledged revenue stream and a general obligation pledge); |
■ | Municipal bonds, which are paid back solely using a general obligation pledge or an appropriation, may not be included; |
■ | Municipal bonds from Puerto Rico which are classified as “Sales Tax” may not be included; and |
Prospectus October 1, 2019, as revised June 1, 2020 | 9 | Fund Details |
■ | Municipal bonds where the obligor is a corporation may not be included. |
Prospectus October 1, 2019, as revised June 1, 2020 | 10 | Fund Details |
Prospectus October 1, 2019, as revised June 1, 2020 | 11 | Fund Details |
Prospectus October 1, 2019, as revised June 1, 2020 | 12 | Fund Details |
■ | Electric utilities bond risk. The electric utilities industry has been experiencing, and may continue to experience, increased competitive pressures. Federal legislation may open transmission access to any electricity supplier, although it is not presently known to what extent competition will evolve. Other risks include: (a) the availability and cost of fuel; (b) the availability and cost of capital; (c) the effects of conservation on energy demand; (d) the effects of rapidly changing environmental, safety and licensing requirements, and other federal, state and local regulations; (e) timely and sufficient rate increases and governmental limitations on rates charged to customers; (f) the effects of opposition to nuclear power; (g) increases in operating costs; and (h) obsolescence of existing equipment, facilities and products. |
■ | Resource recovery bond risk. Resource recovery bonds are a type of revenue bond issued to build facilities such as solid waste incinerators or waste-to-energy plants. Typically, a private corporation is involved, at least during the construction phase, and the revenue stream is secured by fees or rents paid by municipalities for use of the facilities. These bonds are normally secured only by the revenues from the project and not by state or local government tax receipts. Consequently, the credit quality of these securities is dependent upon the ability of the user of the facilities financed by the bonds and any guarantor to meet its financial obligations. The viability of a resource recovery project, environmental protection regulations, and project operator tax incentives may affect the value and credit quality of resource recovery bonds. |
■ |
Lease obligations risk. Lease obligations may have risks not normally associated with general obligation or other revenue bonds. Leases and installment purchase or conditional sale contracts (which may provide
for title to the leased asset to pass eventually to the issuer) have developed as a means for governmental issuers to acquire property and equipment without the necessity of complying with the constitutional statutory
requirements generally applicable for the issuance of debt.
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Certain lease obligations contain “non-appropriation” clauses that provide that the governmental issuer has no obligation to make future payments under the lease or contract unless money is appropriated for that purpose by the appropriate legislative body on an annual or other periodic basis. Consequently, continued lease payments on those lease obligations containing “non-appropriation” clauses are dependent on future legislative actions. If these legislative actions do not occur, the holders of the lease obligation may experience difficulty in exercising their rights, including disposition of the property. |
■ | Municipal bond market risk. Deteriorating market conditions might cause a general weakness in the market that reduces the prices of securities in that market. Developments in a particular class of debt securities or the stock market could also adversely affect the fund by reducing the relative attractiveness of debt securities as an investment. Also, to the extent that the fund emphasizes debt securities from any given state or region, it could be hurt if that state or region does not do well. |
Prospectus October 1, 2019, as revised June 1, 2020 | 13 | Fund Details |
Prospectus October 1, 2019, as revised June 1, 2020 | 14 | Fund Details |
Prospectus October 1, 2019, as revised June 1, 2020 | 15 | Fund Details |
■ | The policy of investing at least 80% of net assets (plus the amount of any borrowings for investment purposes) in municipal securities and other securities whose income is free from regular federal income tax cannot be changed without shareholder approval. Certain fundamental policies of the fund are set forth in the SAI. |
■ | Because the fund seeks to track its Underlying Index, the fund does not invest and the fund will not invest in money market instruments or other short-term investments as part of a temporary defensive strategy to protect against potential market declines. |
■ | The fund may borrow money from a bank up to a limit of 10% of the value of its assets, but only for temporary or emergency purposes. |
■ | From time to time a third party, the Advisor and/or its affiliates may invest in the fund and hold its investment for a specific period of time in order for the fund to achieve size or scale. There can be no assurance that any such entity would not redeem its investment or that the size of the fund would be maintained at such levels. In order to comply with applicable law, it is possible that the Advisor or its affiliates, to the extent they are invested in the fund, may be required to redeem some or all of their ownership interests in the fund prematurely or at an inopportune time. |
■ | Secondary market trading in fund shares may be halted by a stock exchange because of market conditions or other reasons. In addition, trading in fund shares on a stock exchange or in any market may be subject to trading halts caused by extraordinary market volatility pursuant to “circuit breaker” rules on the exchange or market. If a trading halt or unanticipated early closing of a stock exchange occurs, a shareholder may be unable |
Prospectus October 1, 2019, as revised June 1, 2020 | 16 | Fund Details |
to purchase or sell shares of the fund. There can be no assurance that the requirements necessary to maintain the listing or trading of fund shares will continue to be met or will remain unchanged or that shares will trade with any volume, or at all, in any secondary market. As with all other exchange traded securities, shares may be sold short and may experience increased volatility and price decreases associated with such trading activity. |
■ | From time to time, the fund may have a concentration of shareholder accounts holding a significant percentage of shares outstanding. Investment activities of these shareholders could have a material impact on the fund. For example, the fund may be used as an underlying investment for other registered investment companies. |
Fund Name | Fee Paid |
Xtrackers Municipal Infrastructure Revenue Bond ETF | 0.15% |
Prospectus October 1, 2019, as revised June 1, 2020 | 17 | Fund Details |
■ | Joined DWS in 2011 with 11 years of industry experience. Prior to his current role, he served as the primary portfolio manager for the PowerShares DB Commodity ETFs until their sale in 2015. Prior to joining DWS, he served as an equity analyst for Fairhaven Capital LLC, a long/short equity fund, and at XShares Advisors, an ETF issuer based in New York. |
■ | Head of Passive Portfolio Management, Americas: New York. |
■ | BS in Finance, Boston College. |
■ | Joined DWS in 2011 with 12 years of industry experience. Prior to joining DWS, he was a relationship manager in the Portfolio Analytics Group at BlackRock Solutions. Previously, he managed overlay accounts at BNY Mellon Beta Management, and was a senior portfolio manager for fixed income ETFs and mutual funds at Charles Schwab Investment Management. |
■ | Fixed Income Portfolio Manager, Passive Asset Management: New York. |
■ | BS in History, University of California, Irvine; MBA in Finance, University of Hawaii; Financial Risk Certification holder. |
■ | Joined DWS in 2010. Prior to his current role, he was responsible for trading and market making of European fixed income ETFs, structured funds, index swaps and options within the Fixed Income Derivatives Group in Corporate Banking & Securities, based out of London. |
■ | Fixed Income Portfolio Manager, Passive Asset Management: New York. |
■ | BTech and MTech (dual degree) in Industrial Engineering & Management, Indian Institute of Technology Kharagnur. |
■ | Joined DWS in 2016, with 5 years of industry experience. Prior to joining DWS, he was responsible for management of fixed income mutual funds and ETFs at Charles Schwab Investment Management, where he previously supported portfolio managers and middle office duties. |
■ | Fixed Income Portfolio Manager, Passive Asset Management: New York. |
■ | BSBA in Finance, University of Arizona. |
Prospectus October 1, 2019, as revised June 1, 2020 | 18 | Fund Details |
Fund name | Ticker Symbol | Stock Exchange |
Xtrackers Municipal Infrastructure
Revenue Bond ETF |
RVNU | NYSE Arca, Inc. |
Prospectus October 1, 2019, as revised June 1, 2020 | 19 | Investing in the Fund |
Prospectus October 1, 2019, as revised June 1, 2020 | 20 | Investing in the Fund |
Prospectus October 1, 2019, as revised June 1, 2020 | 21 | Investing in the Fund |
Prospectus October 1, 2019, as revised June 1, 2020 | 22 | Investing in the Fund |
Fund Name | Fee |
Xtrackers Municipal Infrastructure Revenue Bond ETF | $500 |
Prospectus October 1, 2019, as revised June 1, 2020 | 23 | Investing in the Fund |
Prospectus October 1, 2019, as revised June 1, 2020 | 24 | Investing in the Fund |
Years Ended May 31, | |||||
2019 | 2018 | 2017 | 2016 | 2015 | |
Selected Per Share Data | |||||
Net Asset Value, beginning of year | $26.52 | $26.71 | $27.17 | $25.49 | $25.07 |
Income (loss) from investment operations: | |||||
Net investment income (loss)a | 0.75 | 0.70 | 0.66 | 0.80 | 0.81 |
Net realized and unrealized gain (loss) | 1.18 | (0.20) | (0.46) | 1.67 | 0.40 |
Total from investment operations | 1.93 | 0.50 | 0.20 | 2.47 | 1.21 |
Less distributions from: | |||||
Net investment income | (0.75) | (0.69) | (0.66) | (0.79) | (0.79) |
Total distributions | (0.75) | (0.69) | (0.66) | (0.79) | (0.79) |
Net Asset Value, end of year | $27.70 | $26.52 | $26.71 | $27.17 | $25.49 |
Total Return (%) | 7.45b | 1.87 | 0.77 | 9.89 | 4.88 |
Ratios to Average Net Assets and Supplemental Data | |||||
Net Assets, end of year ($ millions) | 68 | 58 | 60 | 37 | 22 |
Ratio of expenses before fee waiver (%) | 0.25 | 0.30 | 0.30 | 0.30 | 0.30 |
Ratio of expenses after fee waiver (%) | 0.22 | 0.30 | 0.30 | 0.30 | 0.30 |
Ratio of net investment income (loss) (%) | 2.85 | 2.61 | 2.5 | 3.07 | 3.16 |
Portfolio turnover rate (%)c | 25 | 28 | 0 | 13 | 4 |
a | Based on average shares outstanding during the period. |
b | Total Return would have been lower if certain expenses had not been reimbursed by the Advisor. |
c | Portfolio turnover rate does not include securities received or delivered from processing creations or redemptions. |
Prospectus October 1, 2019, as revised June 1, 2020 | 25 | Financial Highlights |
Prospectus October 1, 2019, as revised June 1, 2020 | 26 | Appendix |
Prospectus October 1, 2019, as revised June 1, 2020 | 27 | Appendix |
Call: |
1-855-329-3837 or 1-855-DBX-ETFS
(toll free) Monday through Friday 8:30 a.m. to 6:30 p.m. (Eastern time) E-mail: dbxquestions@list.db.com |
Write: |
DBX ETF Trust
c/o ALPS Distributors, Inc. 1290 Broadway, Suite 1000 Denver, Colorado 80203 |
Xtrackers Municipal Infrastructure Revenue Bond ETF |
NYSE Arca, Inc.: RVNU |
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Part II
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Detailed Part II table of contents precedes page II-1
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(1) | concentrate its investments (i.e., invest 25% or more of its total assets in the securities of a particular industry or group of industries), except that the fund will concentrate to the extent that its underlying index concentrates in the securities of such particular industry or group of industries. For purposes of this limitation, securities of the U.S. government (including its agencies and instrumentalities), repurchase agreements collateralized by U.S. government securities, and securities of state or municipal governments and their political sub-divisions are not considered to be issued by members of any industry; |
(2) | borrow money, except that (i) the fund may borrow from banks for temporary or emergency (not leveraging) purposes, including the meeting of redemption requests which might otherwise require the untimely disposition of securities; and (ii) the fund may, to the extent consistent with its investment policies, enter into repurchase agreements, reverse repurchase agreements, forward roll transactions and similar investment strategies and techniques; to the extent that it engages in transactions described in (i) and (ii), the fund will be limited so that no more than 33 1/3% of the value of its total assets (including the amount |
borrowed) is derived from such transactions. Any borrowings which come to exceed this amount will be reduced in accordance with applicable law; | |
(3) | issue any senior security, except as permitted under the 1940 Act, as amended, and as interpreted, modified or otherwise permitted by regulatory authority having jurisdiction, from time to time; |
(4) | make loans, except as permitted under the 1940 Act, as interpreted, modified or otherwise permitted by regulatory authority having jurisdiction, from time to time; |
(5) | purchase or sell real estate unless acquired as a result of ownership of securities or other investments (but this restriction shall not prevent the fund from investing in securities of companies engaged in the real estate business or securities or other instruments backed by real estate or mortgages), or commodities or commodity contracts (but this restriction shall not prevent the fund from trading in futures contracts and options on futures contracts, including options on currencies to the extent consistent with the fund’s investment objectives and policies); or |
(6) | engage in the business of underwriting securities issued by other persons except, to the extent that the fund may technically be deemed to be an underwriter under the 1933 Act, the disposing of portfolio securities. |
(1) | sell securities short, unless the fund owns or has the right to obtain securities equivalent in-kind and amount to the securities sold short at no added cost, and provided that transactions in options, futures contracts, options on futures contracts or other derivative instruments are not deemed to constitute selling securities short; |
(2) | purchase securities on margin, except that the fund may obtain such short-term credits as are necessary for the clearance of transactions; and provided that margin deposits in connection with futures contracts, options on futures contracts or other derivative instruments shall not constitute purchasing securities on margin; |
(3) | purchase securities of open-end or closed-end investment companies except in compliance with the 1940 Act; |
(4) | invest in direct interests in oil, gas or other mineral exploration programs or leases; however, the fund may invest in the securities of issuers that engage in these activities); and |
(5) | invest in illiquid securities if, as a result of such investment, more than 15% of the fund’s net assets would be invested in illiquid securities. |
Board Member |
Xtrackers Municipal
Infrastructure Revenue Bond ETF |
Independent Board Member: | |
Stephen R. Byers | None |
George O. Elston | None |
J. David Officer | None |
Interested Board Member: | |
Michael Gilligan | None |
Funds Overseen by
Board Member in the Xtrackers Funds |
|
Independent Board Member: | |
Stephen R. Byers | $50,001 - $100,000 |
George O. Elston | None |
J. David Officer | $10,001 - $50,000 |
Interested Board Member: | |
Michael Gilligan | None |
(1) | The dollar ranges are: None, $1 – $10,000, $10,001 – $50,000, $50,001 – $100,000, or over $100,000. |
Independent
Board Member |
Owner and
Relationship to Board Member |
Company |
Title of
Class |
Value of
Securities on an Aggregate Basis |
Percent of
Class on an Aggregate Basis |
Stephen R. Byers | None | ||||
George O. Elston | None | ||||
J. David Officer | None |
Name and Address | Percentage Ownership |
Charles Schwab & Co., Inc.
2423E. Lincoln Drive Phoenix, AZ 85016-1215 |
26.31% |
Merrill Lynch, Pierce, Fenner & Smith Inc.
101 Hudson St. Jersey City, NJ 07302-3997 |
17.02% |
National Financial Services LLC
499 Washington Blvd. Jersey City, NJ 07310 |
10.59% |
Pershing LLC
One Pershing Plaza Jersey City, NJ 07399 |
9.77% |
TD Ameritrade
4700 Alliance Gateway Freeway Fort Worth, TX 76177 |
6.37% |
Folio Investments, Inc.
8180 Greenboro Dr., 8th Fl. McClean, VA 22102 |
5.50% |
Name of Committee |
Number of
Meetings in Last Fiscal Year |
Functions | Current Board Members |
AUDIT COMMITTEE | 3 | The Audit Committee has the responsibility, among other things, to: (i) approve the selection, retention, termination and compensation of the Trust’s Independent Registered Public Accounting Firm; (ii) review the scope of the Independent Registered Public Accounting Firm’s audit activity; (iii) review the audited financial statements; and (iv) review with such Independent Registered Public Accounting Firm the adequacy and the effectiveness of the Trust’s internal controls. | George O. Elston (Chairman), Stephen R. Byers and J. David Officer |
NOMINATING COMMITTEE | 0 | The Nominating Committee has the responsibility, among other things, to identify and recommend individuals for Board membership, and evaluate candidates for Board membership. The Board will consider recommendations for Board Members from shareholders. Nominations from shareholders should be in writing and sent to the Board, to the attention of the Chairman of the Nominating Committee, as described in Part II SAI Appendix II-A under the caption “Shareholder Communications to the Board.” | J. David Officer (Chairman), Stephen R. Byers and George O. Elston |
Board Member |
Total Compensation from the
Xtrackers Fund Complex(1) |
Independent Board Member: | |
Stephen R. Byers(2) | $169,500 |
George O. Elston(3) | $154,500 |
J. David Officer | $144,500 |
Interested Board Member: | |
Michael Gilligan | None |
(1) | For each Independent Board Member, total compensation from the Xtrackers fund complex represents compensation from 38 funds as of December 31, 2018. |
(2) | Includes $25,000 in annual retainer fees received by Mr. Byers as Chairman of the Xtrackers funds. |
(3) | Includes $15,000 in annual retainer fees received by Mr. Elston as Chairman of the Audit Committee. |
Name of Portfolio Manager |
Dollar Range of
Fund Shares Owned |
Bryan Richards | $10,001 - $50,000 |
Brandon Matsui | $50,001 - $100,000 |
Tanuj Dora | $10,001 - $50,000 |
Alexander Bridgeforth | $0 |
Name of
Portfolio Manager |
Number of
Registered Investment Companies |
Total Assets of
Registered Investment Companies |
Number of Investment
Company Accounts with Performance- Based Fee |
Total Assets of
Performance-Based Fee Accounts |
Bryan Richards | 35 | $11,954,986,686 | 0 | $0 |
Brandon Matsui | 9 | $3,180,870,131 | 0 | $0 |
Tanuj Dora | 9 | $3,180,870,131 | 0 | $0 |
Alexander Bridgeforth | 9 | $3,180,870,131 | 0 | $0 |
Name of
Portfolio Manager |
Number of
Pooled Investment Vehicles |
Total Assets of
Pooled Investment Vehicles |
Number of Pooled
Investment Vehicle Accounts with Performance- Based Fee |
Total Assets of
Performance- Based Fee Accounts |
Bryan Richards | 0 | $0 | 0 | $0 |
Brandon Matsui | 0 | $0 | 0 | $0 |
Tanuj Dora | 0 | $0 | 0 | $0 |
Alexander Bridgeforth | 0 | $0 | 0 | $0 |
Name of
Portfolio Manager |
Number of
Other Accounts |
Total Assets
of Other Accounts |
Number of Other
Accounts with Performance- Based Fee |
Total Assets of
Performance- Based Fee Accounts |
Bryan Richards | 26 | $1,835,290,407 | 0 | $0 |
Brandon Matsui | 4 | $344,221,188 | 0 | $0 |
Tanuj Dora | 4 | $344,221,188 | 0 | $0 |
Alexander Bridgeforth | 4 | $344,221,188 | 0 | $0 |
Fiscal Year Ended |
Gross Amount
for Advisory Services |
Amount Waived
by DBX for Advisory Services |
2019(1) | $148,481 | $17,552 |
2018 | $182,537 | $0 |
2017(2) | $170,622 | $0 |
Fund | 2019 | 2018 |
Xtrackers Municipal Infrastructure Revenue Bond ETF | 25% | 28% |
Fiscal
Year |
Brokerage Commissions
Paid by Fund |
|
Xtrackers Municipal Infrastructure Revenue Bond ETF | 2019 | $0 |
2018 | $0 | |
2017 | $0 |
Fund and its Fiscal Year End | Exchange | CUSIP Number |
Xtrackers Municipal Infrastructure Revenue Bond ETF | NYSE Arca, Inc. | 233051705 |
Fiscal Year End: 5/31 |
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• | Amortization schedule—the larger the final maturity relative to other maturities, the more likely it will be treated as a note; and |
• | Source of payment—the more dependent the issue is on the market for its refinancing, the more likely it will be treated as a note. |
A+ | Highest | B+ | Average | C | Lowest |
A | High | B | Below Average | D | In Reorganization |
A– | Above Average | B– | Low | LIQ | Liquidation |
Name, Year of Birth, Position
with the Trust and Length of Time Served(1) |
Business Experience and
Directorships During the Past 5 Years |
Number of
Portfolios in Fund Complex Overseen |
Other Directorships
Held by Board Member |
Stephen R. Byers (1953)Chairman since 2016,
and Board Member since 2011 (formerly, Lead Independent Board Member, 2015-2016) |
Independent Director (2011- present); Independent Consultant (2014-present); Director of Investment Management, the Dreyfus Corporation (2000-2006) and Vice Chairman and Chief Investment Officer, the Dreyfus Corporation (2002-2006). | 34 | The Arbitrage Funds, Sierra Income Corporation, Mutual Fund Directors Forum |
George O. Elston (1964)
Board Member since 2011, Chairman of the Audit Committee since 2015 |
Chief Financial Officer, Enzyvant (2018-present); Chief Executive Officer, 2X Oncology, Inc. (2017-2018); Senior Vice President and Chief Financial Officer, Juniper Pharmaceuticals, Inc. (2014-2016); Senior Vice President and Chief Financial Officer, KBI BioPharma Inc. (2013-2014); Managing Partner, Chatham Street Partners (2010-2013). | 34 | - |
J. David Officer (1948) Board Member since 2011, Chairman of the Nominating Committee since 2015 | Independent Director (2010-present); Vice Chairman, the Dreyfus Corporation (2006-2009); President, The Dreyfus Family of Funds, Inc. (2006-2009). | 34 | (Chairman of) Ilex Management Ltd,; Old Westbury Funds |
(1) | The length of time served is represented by the year in which the Board Member joined the Board. |
(2) | As a result of their respective positions held with the Advisor and its affiliates, these individuals are considered “interested persons” of the Advisor within the meaning of the 1940 Act. Interested persons receive no compensation from the fund. |
(3) | Executive title, not a board directorship. |
(4) | The length of time served is represented by the year in which the officer was first elected to the Trust in such capacity. |
(5) | Address: 875 Third Avenue, New York, New York 10022. |
(6) | Address: One International Place, Boston, Massachusetts 02110. |
(7) | Address: BNY Mellon Asset Servicing, Atlantic Terminal Office Tower, 2 Hanson Place, Brooklyn, NY 11217. |
• | Fixed Pay (FP) is the key and primary element of compensation for the majority of DWS employees and reflects the value of the individual’s role and function within the organization. It rewards factors that an employee brings to the organization such as skills and experience, while reflecting regional and divisional (i.e., DWS) specifics. FP levels play a significant role in ensuring competitiveness of the Advisor and its affiliates in the labor market, thus benchmarking provides a valuable input when determining FP levels. |
• | Variable Compensation (VC) is a discretionary compensation element that enables the Advisor and its affiliates to provide additional reward to employees for their performance and behaviors, while reflecting DWS affordability and the financial situation of Deutsche Bank AG (the “Bank”) and DWS. VC aims to: |
Recognize that every employee contributes to the DWS Group’s success through the DWS Group and/or Bank component of VC (Group Component); | |
Reflect individual performance, investment performance, behaviors and culture through discretionary individual VC (Individual Component); and | |
Reward outstanding contributions at the junior levels through the discretionary Recognition Award. |
• | VC can be delivered via cash, restricted equity awards, and/or restricted incentive awards or restricted compensation. Restricted compensation may include: |
Notional fund investments; | |
Restricted equity, notional equity; | |
Restricted cash; or | |
Such other form as DWS may decide in its sole discretion. | |
• | VC comprises a greater proportion of total compensation as an employee’s seniority and total compensation level increase. Proportion of VC delivered via a long-term incentive award, which is subject to performance conditions and forfeiture provisions, will increase significantly as the amount of the VC increases. |
• | Additional forfeiture and claw back provisions, including complete forfeiture and claw back of VC may apply in certain events if an employee is an InstVV [CRD IV EU Directive4] Material Risk Taker. |
• | For key investment professionals, in particular, a portion of any long-term incentives will be in the form of notional investments aligned, where possible, to a suite of flagship funds managed by the DWS ETF platform. |
• | Quantitative measures (e.g. tracking error and tracking difference) are utilized to measure performance. |
• | Qualitative measures (e.g., adherence to, as well as contributions to, the enhancement of the investment process) are included in the performance review. |
• | Other factors (e.g., non-investment related performance, teamwork, adherence to compliance rules, risk management and “living the values” of the Advisor and its affiliates) are included as part of a discretionary component of the review process, giving management the ability to consider additional markers of performance on a subjective basis. |
• | Furthermore, it is important to note that DWS Group functions within a controlled environment based upon the risk limits established by DWS Group's Risk division, in conjunction with DWS Group management. Because risk consideration is inherent in all business activities, performance assessment factors in an employee’s ability to assess and manage risk. |
• | Certain investments may be appropriate for a fund and also for other clients advised by the Advisor and their affiliates, including other client accounts managed by a fund’s portfolio management team. Investment decisions for a fund and other clients are made with a view to achieving their respective investment objectives and after consideration of such factors as their current holdings, availability of cash for investment and the size of their investments generally. A particular security may be bought or sold for only one client or in different amounts and at different times for more than one but less than all clients. Likewise, because clients of the Advisor and their affiliates may have differing investment strategies, a particular security may be bought for one or more clients when one or more other clients are selling the security. The investment results achieved for a fund may differ from the results achieved for other clients of the Advisor and their affiliates. In addition, purchases or sales of the same security may be made for two or more clients on the same day. In such event, such transactions will be allocated among the clients in a manner believed by the Advisor and their affiliates to be most equitable to each client, generally utilizing a pro rata allocation methodology. In some cases, the allocation procedure could potentially have an adverse effect or positive effect on the price or amount of the securities purchased or sold by a fund. Purchase and sale orders for a fund may be combined with those of other clients of the Advisor and their affiliates in the interest of achieving the most favorable net results to a fund and the other clients. |
• | To the extent that a portfolio manager has responsibilities for managing multiple client accounts, a portfolio manager will need to divide time and attention among relevant accounts. The Advisor and their affiliates attempt to minimize these conflicts by aligning its portfolio management teams by investment strategy and by employing similar investment models across multiple client accounts. |
• | In some cases, an apparent conflict may arise where the Advisor has an incentive, such as a performance-based fee, in managing one account and not with respect to other accounts it manages. The Advisor and their affiliates will not determine allocations based on whether it receives a performance-based fee from the client. Additionally, the Advisor has in place supervisory oversight processes to periodically monitor performance deviations for accounts with like strategies. |
• | The Advisor and its affiliates and the investment team of a fund may manage other mutual funds and separate accounts on a long only or a long-short basis. The simultaneous management of long and short portfolios creates potential conflicts of interest including the risk that short sale activity could adversely affect the market value of the long positions (and vice versa), the risk arising from sequential orders in long and short positions, and the risks associated with receiving opposing orders at the same time. The Advisor has adopted procedures that it believes are reasonably designed to mitigate these and other potential conflicts of interest. Included in these procedures are specific guidelines developed to provide fair and equitable treatment for all clients whose accounts are managed by each fund’s portfolio management team. The Advisor and the portfolio management team have established monitoring procedures, a protocol for supervisory reviews, as well as compliance oversight to ensure that potential conflicts of interest relating to this type of activity are properly addressed. |
• | Certain investments may be appropriate for a fund and also for other clients advised by the Advisor, including other client accounts managed by a fund’s portfolio management team. Investment decisions for a fund and other clients are made with a view to achieving their respective investment objectives and after consideration of such factors as their current holdings, availability of cash for investment and the size of their investments generally. A particular security may be bought or sold for only one client or in different amounts and at different times for more than one but less than all clients. Likewise, because clients of the Advisor may have differing investment strategies, a particular security may be bought for one or more clients when one or more other clients are selling the security. The investment results achieved for a fund may differ from the results achieved for other clients of the Advisor. In addition, purchases or sales of the same security may be made for two or more clients on the same day. In such event, such transactions will be allocated among the clients in a manner believed by the Advisor to be most equitable to each client, generally utilizing a pro rata allocation methodology. In some cases, the allocation procedure could potentially have an adverse effect or positive effect on the price or amount of the securities purchased or sold by a fund. Purchase and sale orders for a fund may be combined with those of other clients of the Advisor in the interest of achieving the most favorable net results to a fund and the other clients. |
• | To the extent that a portfolio manager has responsibilities for managing multiple client accounts, a portfolio manager will need to divide time and attention among relevant accounts. The Advisor attempts to minimize these conflicts by aligning its portfolio management teams by investment strategy and by employing similar investment models across multiple client accounts. |
• | In some cases, an apparent conflict may arise where the Advisor has an incentive, such as a performance-based fee, in managing one account and not with respect to other accounts it manages. The Advisor will not determine allocations based on whether it receives a performance-based fee from the client. Additionally, the Advisor has in place supervisory oversight processes to periodically monitor performance deviations for accounts with like strategies. |
• | The Advisor and its affiliates and the investment team of a fund may manage other mutual funds and separate accounts on a long only or a long-short basis. The simultaneous management of long and short portfolios creates potential conflicts of interest including the risk that short sale activity could adversely affect the market value of the long positions (and vice versa), the risk arising from sequential orders in long and short positions, and the risks associated with receiving opposing orders at the same time. The Advisor has adopted procedures that it believes are reasonably designed to mitigate these and other potential conflicts of interest. Included in these procedures are specific guidelines developed to provide fair and equitable treatment for all clients whose accounts are managed by each fund’s portfolio management team. The Advisor and the portfolio management team have established monitoring procedures, a protocol for supervisory reviews, as well as compliance oversight to ensure that potential conflicts of interest relating to this type of activity are properly addressed. |
Fund Name | Unitary Advisory Fee Rate |
MSCI Currency Hedged Funds | |
Xtrackers MSCI All World ex US Hedged Equity ETF | 0.40% |
Xtrackers MSCI EAFE Hedged Equity ETF | 0.35% |
Xtrackers MSCI Emerging Markets Hedged Equity ETF | 0.65% |
Xtrackers MSCI Europe Hedged Equity ETF | 0.45% |
Xtrackers MSCI Eurozone Hedged Equity ETF | 0.45% |
Xtrackers MSCI Germany Hedged Equity ETF | 0.45% |
Xtrackers MSCI Japan Hedged Equity ETF | 0.45% |
Specialty Funds | |
Xtrackers International Real Estate ETF | 0.12% |
Equity Funds | |
Xtrackers Eurozone Equity ETF | 0.09% |
Xtrackers FTSE Developed Ex US Comprehensive Factor ETF | 0.35% |
Xtrackers Japan JPX-Nikkei 400 Equity ETF | 0.09% |
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF | 0.16% |
Xtrackers MSCI All World ex US High Dividend Yield Equity ETF | 0.20% |
Xtrackers MSCI EAFE ESG Leaders Equity ETF | 0.14% |
Xtrackers MSCI EAFE High Dividend Yield Equity ETF | 0.20% |
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF | 0.20% |
Xtrackers MSCI Kokusai Equity ETF | 0.09% |
Xtrackers MSCI Latin America Pacific Alliance ETF | 0.45% |
Xtrackers MSCI USA ESG Leaders Equity ETF | 0.10% |
Xtrackers Russell 1000 Comprehensive Factor ETF | 0.17% |
Xtrackers Russell 1000 US Quality at a Reasonable Price ETF | 0.19% |
Xtrackers S&P 500 ESG ETF | 0.11% |
China Funds | |
Xtrackers Harvest CSI 300 China A-Shares ETF | 0.65% |
Xtrackers Harvest CSI 500 China A-Shares Small Cap ETF | 0.65% |
Xtrackers MSCI All China Equity ETF | 0.50% |
Xtrackers MSCI China A Inclusion Equity ETF | 0.60% |
Fixed Income Funds | |
Xtrackers Bloomberg Barclays US Investment Grade Corporate ESG ETF | 0.15% |
Fund Name | Unitary Advisory Fee Rate |
Xtrackers High Beta High Yield Bond ETF | 0.35% |
Xtrackers J.P. Morgan ESG Emerging Markets Sovereign ETF | 0.35% |
Xtrackers J.P. Morgan ESG USD High Yield Corporate Bond ETF | 0.20% |
Xtrackers Low Beta High Yield Bond ETF | 0.25% |
Xtrackers Municipal Infrastructure Revenue Bond ETF | 0.15% |
Xtrackers Short Duration High Yield Bond ETF | 0.20% |
Xtrackers USD High Yield Corporate Bond ETF | 0.20% |
1. | Scope |
2. | DWS’S Proxy Voting Responsibilities |
3. | POLICIES |
3.1. | Proxy Voting Activities are Conducted in the Best Economic Interest of Clients |
3.2. | The Global Proxy Voting Sub-Committee |
• | Adopting, monitoring and updating guidelines, attached as Attachment A (the “Guidelines”), that provide how DWS will generally vote proxies pertaining to a comprehensive list of common proxy voting matters; |
• | Voting proxies where: (i) the issues are not covered by specific client instruction or the Guidelines; (ii) the Guidelines specify that the issues are to be determined on a case-by-case basis; or (iii) where an exception to the Guidelines may be in the best economic interest of DWS’s clients; and |
• | Monitoring Proxy Vendor Oversight’s proxy voting activities (see below). |
1 | For purposes of this document, “clients” refers to persons or entities: (i) for which DWS serves as investment adviser or sub-adviser; (ii) for which DWS votes proxies; and (iii) that have an economic or beneficial ownership interest in the portfolio securities of issuers soliciting such proxies. |
3.3 | Availability of Proxy Voting Policies and Proxy Voting Record |
4. | Procedures |
4.1. | The GPVSC’s Proxy Voting Guidelines |
4.2. | Specific Proxy Voting Decisions Made by the GPVSC |
2 | Proxy Vendor Oversight generally monitors upcoming proxy solicitations for heightened attention from the press or the industry and for novel or unusual proposals or circumstances, which may prompt Proxy Vendor Oversight to bring the solicitation to the attention of the GPVSC Chair. DWS Portfolio Managers, DWS Research Analysts and sub-advisers also may bring a particular proxy vote to the attention of the GPVSC Chair, as a result of their ongoing monitoring of portfolio securities held by advisory clients and/or their review of the periodic proxy voting record reports that the GPVSC Chair distributes to DWS portfolio managers and DWS research analysts. |
4.3. | The GPVSC’s Proxy Voting Guidelines |
• | Neither the Guidelines nor specific client instructions cover an issue; |
• | ISS does not make a recommendation on the issue; and |
• | The GPVSC cannot convene on the proxy proposal at issue to make a determination as to what would be in the client’s best interest. (This could happen, for example, if the Conflicts of Interest Management Sub-Committee found that there was a material conflict or if despite all best efforts being made, the GPVSC quorum requirement could not be met). |
4.4. | Conflict of Interest Procedures |
4.4.1. | Procedures to Address Conflicts of Interest and Improper Influence |
3 | As mentioned above, the GPVSC votes proxies where: (i) neither a specific client instruction nor a Guideline directs how the proxy should be voted; (ii) where the Guidelines specify that an issue is to be determined on a case-by-case basis; or (iii) where voting in accordance with the Guidelines may not be in the best economic interests of clients. |
4 | Proxy Vendor Oversight, who serves as the non-voting secretary of the GPVSC, may receive routine calls from proxy solicitors and other parties interested in a particular proxy vote. Any contact that attempts to exert improper pressure or influence shall be reported to the Conflicts of Interest Management Sub-Committee. |
4.4.2. | Investment Companies and Affiliated Public Companies |
4.4.3. | Other Procedures that Limit Conflicts of Interest |
• | Code of Conduct – DB Group; |
• | Conflicts of Interest Policy – DWS Group; |
• | Code of Ethics – DWS US; |
• | Code of Ethics – DWS ex US |
• | Code of Professional Conduct – US. |
5. | RECORDKEEPING |
• | DWS will maintain a record of each proxy vote cast by DWS that includes among other things, company name, meeting date, proposals presented, vote cast, and shares voted. |
• | Proxy Vendor Oversight maintains records for each of the proxy ballots it votes. Specifically, the records include, but are not limited to: |
− | The proxy statement (and any additional solicitation materials) and relevant portions of annual statements; |
− | Any additional information considered in the voting process that may be obtained from an issuing company, its agents, or proxy research firms; |
− | Analyst worksheets created for stock option plan and share increase analyses; and |
− | Proxy Edge print-screen of actual vote election. |
• | DWS will: (i) retain this Policy and the Guidelines; (ii) will maintain records of client requests for proxy voting information; and (iii) will retain any documents Proxy Vendor Oversight or the GPVSC prepared that were material to making a voting decision or that memorialized the basis for a proxy voting decision. |
• | The GPVSC also will create and maintain appropriate records documenting its compliance with this Policy, including records of its deliberations and decisions regarding conflicts of interest and their resolution. |
• | With respect to DWS’s investment company clients, ISS will create and maintain records of each company’s proxy voting record for the 12-month periods ending June 30. DWS will compile the following information for each matter relating to a portfolio security considered at any shareholder meeting held during the period covered by the report (and with respect to which the company was entitled to vote): |
− | The name of the issuer of the portfolio security; |
− | The exchange ticker symbol of the portfolio security (if symbol is available through reasonably practicable means); |
− | The Council on Uniform Securities Identification Procedures (“CUSIP”) number for the portfolio security (if the number is available through reasonably practicable means); |
− | The shareholder meeting date; |
− | A brief identification of the matter voted on; |
− | Whether the matter was proposed by the issuer or by a security holder; |
− | Whether the company cast its vote on the matter; |
− | How the company cast its vote (e.g., for or against proposal, or abstain; for or withhold regarding election of Directors); and |
− | Whether the company cast its vote for or against Management. |
6. | OVERSIGHT RESPONSIBILITIES |
7. | ANNUAL REVIEW |
8. | GLOSSARY |
9. | LIST OF ANNEXES AND ATTACHMENTS |
I. | Board of Directors and Executives | |
A. | Election of Directors | |
B. | Board Diversity | |
C. | Classified Boards of Directors | |
D. | Board and Committee Independence | |
E. | Liability and Indemnification of Directors | |
F. | Qualification of Directors | |
G. | Removal of Directors and Filling of Vacancies | |
H. | Proposals to Fix the Size of the Board | |
I. | Proposals to Restrict Chief Executive Officer’s Service on Multiple Boards | |
J. | Proposals to Establish Audit Committees | |
II. | Capital Structure | |
A. | Authorization of Additional Shares | |
B. | Authorization of “Blank Check” Preferred Stock | |
C. | Stock Splits/Reverse Stock Splits | |
D. | Dual Class/Supervoting Stock | |
E. | Large Block Issuance | |
F. | Recapitalization into a Single Class of Stock | |
G. | Share Repurchases | |
H. | Reductions in Par Value | |
III. | Corporate Governance Issues | |
A. | Confidential Voting | |
B. | Cumulative Voting | |
C. | Supermajority Voting Requirements | |
D. | Shareholder Right to Vote | |
E. | Amendments of the Articles | |
F. | Related Party Transactions | |
IV. | Compensation | |
A. | Executive and Director Stock Option Plans | |
B. | Employee Stock Option / Purchase Plans | |
C. | Golden Parachutes | |
D. | Proposals to Limit Benefits or Executive Compensation | |
E. | Shareholder Proposals Concerning “Pay for Superior Performance” | |
F. | Executive Compensation Advisory | |
G. | Advisory Votes on Executive Compensation | |
H. | Frequency of Advisory Vote on Executive Compensation | |
V. | Anti-Takeover Related Issues | |
A. | Shareholder Rights Plans (“Poison Pills”) | |
B. | Reincorporation | |
C. | Fair-Price Proposals | |
D. | Exemption From State Takeover Laws | |
E. | Non-Financial Effects of Takeover Bids | |
VI. | Mergers & Acquisitions |
VII. | Environmental, Social and Governance Issues | |
A. | Principles for Responsible Investment | |
B. | ESG Issues | |
VIII. | Miscellaneous Items | |
A. | Ratification of Auditors | |
B. | Limitation of Non-Audit Services Provided by Independent Auditor | |
C. | Audit Firm Rotation | |
D. | Transaction of Other Business | |
E. | Motions to Adjourn the Meeting | |
F. | Bundled Proposals | |
G. | Change of Company Name | |
H. | Proposals Related to the Annual Meeting | |
I. | Reimbursement of Expenses Incurred from Candidate Nomination | |
J. | Investment Company Proxies | |
IX. | International Proxy Voting Guidelines With Application For Holdings Incorporated Outside the United States and Canada | |
A. | Election of Directors | |
B. | Renumeration (Variable Pay) | |
C. | Long-Term Incentive Plans | |
D. | Proposals to Restrict Supervisory Board Members Service on Multiple Boards | |
E. | Establishment of a Remuneration Committee | |
F. | Management Board Election and Motion | |
G. | Large Block Issuance | |
H. | Share Repurchases | |
I. | Use of Net Profits | |
J. | Amendments of the Articles | |
K. | Related Party Transactions | |
L. | Auditor | |
X. | Proxy Voting Guidelines With Application For Holdings Incorporated in Japan |
I. | Board of Directors and Executives |
A. | Election of Directors |
• | Accountability to shareholders and transparency of governance practices |
• | Responsiveness to investor input and shareholder vote |
• | Composition of the board with Directors adding value through skills, expertise and time commitment |
• | Independence from management |
• | A combined CEO/Chairman role without a lead Independent Director in place would trigger a vote “Against” the CEO/Chairman. |
• | Attendance at Board meetings not disclosed on an individual basis in the annual report or on the company’s website and neither is the reported overall attendance above 90%. An individual candidate has attended fewer than 75% of the board and audit / risk committee meetings in a given year without a satisfactory explanation for his / her absence disclosed in a clear and comprehensible form in the relevant proxy filings. Satisfactory explanation will be understood as any health issues or family incidents. These would trigger a vote “Against” the election of the corresponding directors |
• | A former executive director who is nominated for a membership on the non-executive board when two or more former executive directors already serve on the same board would result in a vote “Against” the former executive, as the board cannot be regarded as independent anymore. |
• | Relevant committees in place and they are majority independent. If the main committees are not majority independent, this could trigger a vote of “Abstain” for the Chairman of the Board and if the Chairman is not up for election, “Abstain” on the non-independent committee members. |
• | The management of Environmental Social and Governance (ESG) controversies will be analysed on a case-by-case basis based on relevant internationally recognized E, S or G principles (e.g. the UN Global Compact Principles and OECD Guidelines for Multinationals). Under extraordinary circumstances, DWS will vote against the election of directors or the entire board if there were material failures of governance, stewardship, risk oversight, or fiduciary responsibilities identified as a result of the controversies around the company. |
• | When the director election lengthens the term of office, DWS will consider voting “Against” this election. |
• | The board consists of 50% or less independent Directors; |
• | The non-independent Director is part of the audit, compensation or nominating committee; |
• | The company has not appointed an audit, compensation or nominating committee. |
• | For executive Directors: |
− | Current employee of the company or one of its affiliates. |
• | For non-executive Directors: |
− | Significant ownership (beneficial owner of more than 50% of the company’s voting power) |
− | Former CEO of the company or of an acquired company within the past five years. |
− | Former officer of the company, an affiliate or an acquired firm within the past five years. |
− | Immediate family member of a current or former officer of the company or its affiliates within the last five years |
− | Currently provides (or an immediate family member provides) professional services to the company, to an affiliate of the company or an individual officer of the company or one of its affiliates in excess of $10,000 per year. |
• | Long-term financial performance of the company relative to its industry; |
• | Management’s track record; |
• | Background to the contested election; |
• | Nominee qualifications and any compensatory arrangements; |
• | Strategic plan of dissident slate and quality of the critique against management; |
• | Likelihood that the proposed goals and objectives can be achieved (both slates); and |
• | Stock ownership positions. |
B. | Board Diversity |
• | a firm commitment, as stated in the proxy statement, to appoint at least one woman to the board within a year, |
• | The presence of a woman on the board at the preceding annual meeting and a firm commitment to appoint at least one woman to the board within a year; or |
• | Other relevant factors as applicable. |
C. | Classified Boards of Directors |
D. | Board and Committee Independence |
− | Whether the proposal is binding and whether it requires an immediate change. |
− | Whether the current board has an existing executive or non-independent chair or there was a recent combination of the CEO and chair roles. |
− | Whether the governance structure ensures a sufficient board and committee independence, a balance of board and CEO tenure. |
− | Whether the company has poor governance practices (such as compensation, poor risk oversight, or any actions which harmed or have the potential to harm the interests of the shareholders). |
− | Whether the company is demonstrating poor performance (as per the assessment and recommendation of ISS). |
E. | Liability and Indemnification of Directors |
F. | Qualification of Directors |
G. | Removal of Directors and Filling of Vacancies |
H. | Proposals to Fix the Size of the Board |
1. | “For” proposals to fix the size of the Board unless: (a) no specific reason for the proposed change is given; or (b) the proposal is part of a package of takeover defences. |
2. | “Against” proposals allowing Management to fix the size of the Board without shareholder approval. |
I. | Proposals to Restrict Chief Executive Officer’s Service on Multiple Boards |
J. | Proposals to Establish Audit Committees |
II. | Capital Structure |
A. | Authorization of Additional Shares |
B. | Authorization of “Blank Check” Preferred Stock |
1. | “Against” proposals to create blank check preferred stock or to increase the number of authorized shares of blank check preferred stock unless the company expressly states that the stock will not be used for anti-takeover purposes and will not be issued without shareholder approval. |
2. | “For” proposals mandating shareholder approval of blank check stock placement. |
C. | Stock Splits/Reverse Stock Splits |
D. | Dual Class/Supervoting Stock |
E. | Large Block Issuance |
• | Vote for general issuance requests with pre-emptive rights, or without pre-emptive rights but with a binding “priority right,” for a maximum of 50 percent over currently issued capital. |
• | Generally vote for general authorities to issue shares without pre-emptive rights up to a maximum of 10 percent of share capital. When companies are listed on a regulated market, the maximum discount on share issuance price proposed in the resolution must, in addition, comply with the legal discount (i.e., a maximum of 5 percent discount to the share listing price) for a vote for to be warranted. |
• | The combined equity issuance of all equity instruments with pre-emptive rights exceeds 50 percent of the outstanding share capital or the prevailing maximum threshold as stipulated by best practice rules for corporate governance in the respective country. Exceeding either of the two thresholds will be judged on a CASE-BY- CASE basis, provided that the subscription rights are actively tradable in the market. |
• | The cumulative equity issuances without subscription rights (historical and across instruments) exceed the maximum level specified in a respective country’s best practices for corporate governance or 30 percent of the company’s nominal capital. |
F. | Recapitalization into a Single Class of Stock |
G. | Share Repurchases |
H. | Reductions in Par Value |
III. | Corporate Governance Issues |
A. | Confidential Voting |
B. | Cumulative Voting |
a) | The company has a five year return on investment greater than the relevant industry index; |
b) | All Directors and executive officers as a group beneficially own less than 10% of the outstanding stock; and |
c) | No shareholder (or voting block) beneficially owns 15% or more of the company. |
C. | Supermajority Voting Requirements |
* | Exception made when company holds a controlling position and seeks to lower threshold to maintain control and/or make changes to corporate by-laws. |
D. | Shareholder Right to Vote |
E. | Amendments of the Articles |
F. | Related Party Transactions |
IV. | Compensation |
A. | Executive and Director Stock Option Plans |
B. | Employee Stock Option / Purchase Plans |
C. | Golden Parachutes |
D. | Proposals to Limit Benefits or Executive Compensation |
E. | Shareholder Proposals Concerning “Pay for Superior Performance” |
• | What aspects of the company’s annual and long-term equity incentive programs are performance driven? |
• | If the annual and long-term equity incentive programs are performance driven, are the performance criteria and hurdle rates disclosed to shareholders or are they benchmarked against a disclosed peer group? |
• | Can shareholders assess the correlation between pay and performance based on the current disclosure? |
• | What type of industry and stage of business cycle does the company belong to? |
• | Set compensation targets for the plan’s annual and long-term incentive pay components at or below the peer group median; |
• | Deliver a majority of the plan’s target long-term compensation through performance-vested, not simply time-vested, equity awards; |
• | Provide the strategic rationale and relative weightings of the financial and non-financial performance metrics or criteria used in the annual and performance-vested long-term incentive components of the plan; |
• | Establish performance targets for each plan financial metric relative to the performance of the company’s peer companies; |
• | Limit payment under the annual and performance-vested long-term incentive components of the plan to when the company’s performance on its selected financial performance metrics exceeds peer group median performance. |
F. | Executive Compensation Advisory |
G. | Advisory Votes on Executive Compensation |
• | There is a significant misalignment between CEO pay and company performance (pay for performance); |
• | The company maintains significant problematic pay practices; |
• | The board exhibits a significant level of poor communication and responsiveness to shareholders. |
− | The degree of alignment between the company's annualized TSR rank and the CEO's annualized total pay rank within a peer group, each measured over a three-year period. |
− | The multiple of the CEO's total pay relative to the peer group median. |
• | The ratio of performance- to time-based equity awards; |
• | The overall ratio of performance-based compensation; |
• | The completeness of disclosure and rigor of performance goals; |
• | The company's peer group benchmarking practices; |
• | Actual results of financial/operational metrics, such as growth in revenue, profit, cash flow, etc., both absolute and relative to peers; |
• | Special circumstances related to, for example, a new CEO in the prior FY or anomalous equity grant practices (e.g., bi-annual awards); |
• | Realizable pay compared to grant pay; and |
• | Any other factors deemed relevant. |
• | Systems that entitle the company to recover any sums already paid where necessary (e.g. claw- back system). Deviations are possible wherever the company provides a reasonable explanation why a claw-back was not implemented. |
• | Problematic practices related to non-performance-based compensation elements; |
• | Incentives that may motivate excessive risk-taking; and |
• | Options Backdating. |
• | Repricing or replacing of underwater stock options/SARS without prior shareholder approval (including cash buyouts and voluntary surrender of underwater options); |
• | Excessive perquisites or tax gross-ups, including any gross-up related to a secular trust or restricted stock vesting; |
• | New or extended agreements that provide for: |
− | CIC payments exceeding 3 times base salary and average/target/most recent bonus; |
− | CIC severance payments without involuntary job loss or substantial diminution of duties (“single” or “modified single” triggers); |
− | CIC payments with excise tax gross-ups (including “modified” gross-ups); |
• | Insufficient executive compensation disclosure by externally- managed issuers (EMIs) such that a reasonable assessment of pay programs and practices applicable to the EMI's executives is not possible. |
• | Multi-year guaranteed bonuses; |
• | A single or common performance metric used for short- and long-term plans; |
• | Lucrative severance packages; |
• | High pay opportunities relative to industry peers; |
• | Disproportionate supplemental pensions; or |
• | Mega annual equity grants that provide unlimited upside with no downside risk. |
• | Reason and motive for the options backdating issue, such as inadvertent vs. deliberate grant date changes; |
• | Duration of options backdating; |
• | Size of restatement due to options backdating; |
• | Corrective actions taken by the board or compensation committee, such as cancelling or re-pricing backdated options, the recouping of option gains on backdated grants; and |
• | Adoption of a grant policy that prohibits backdating, and creates a fixed grant schedule or window period for equity grants in the future. |
H. | Frequency of Advisory Vote on Executive Compensation |
V. | Anti-Takeover Related Issues |
A. | Shareholder Rights Plans (“Poison Pills”) |
B. | Reincorporation |
C. | Fair-Price Proposals |
D. | Exemption from State Takeover Laws |
E. | Non-Financial Effects of Takeover Bids |
VI. | Mergers & Acquisitions |
• | Valuation - Is the value to be received by the target shareholders (or paid by the acquirer) reasonable? While the fairness opinion may provide an initial starting point for assessing valuation reasonableness, emphasis is placed on the offer premium, market reaction and strategic rationale. |
• | Market reaction - How has the market responded to the proposed deal? A negative market reaction should cause closer scrutiny of a deal. |
• | Strategic rationale - Does the deal make sense strategically? From where is the value derived? Cost and revenue synergies should not be overly aggressive or optimistic, but reasonably achievable. Management should also have a favorable track record of successful integration of historical acquisitions. |
• | Negotiations and process - Were the terms of the transaction negotiated at arm's-length? Was the process fair and equitable? A fair process helps to ensure the best price for shareholders. Significant negotiation “wins” can also signify the deal makers' competency. The comprehensiveness of the sales process (e.g., full auction, partial auction, no auction) can also affect shareholder value. |
• | Conflicts of interest - Are insiders benefiting from the transaction disproportionately and inappropriately as compared to non-insider shareholders? As the result of potential conflicts, the directors and officers of the company may be more likely to vote to approve a merger than if they did not hold these interests. Consider whether these interests may have influenced these directors and officers to support or recommend the merger. The CIC figure presented in the “ISS Transaction Summary” section of this report is an aggregate figure that can in certain cases be a misleading indicator of the true value transfer from shareholders to insiders. Where such figure appears to be excessive, analyze the underlying assumptions to determine whether a potential conflict exists. |
• | Governance - Will the combined company have a better or worse governance profile than the current governance profiles of the respective parties to the transaction? If the governance profile is to change for the worse, the burden is on the company to prove that other issues (such as valuation) outweigh any deterioration in governance. |
VII. | Environmental, Social, and Governance Issues |
A. | Principles for Responsible Investment |
B. | ESG Issues |
• | Whether the proposal itself is well framed and reasonable; |
• | Whether adoption of the proposal would have either a positive or negative impact on the company's short-term or long-term share value; |
• | Whether the company's analysis and voting recommendation to shareholders is persuasive; |
• | The degree to which the company's stated position on the issues could affect its reputation or sales, or leave it vulnerable to boycott or selective purchasing; |
• | Whether the subject of the proposal is best left to the discretion of the board; |
• | Whether the issues presented in the proposal are best dealt with through legislation, government regulation, or company-specific action; |
• | The company's approach compared with its peers or any industry standard practices for addressing the issue(s) raised by the proposal; |
• | Whether the company has already responded in an appropriate or sufficient manner to the issue(s) raised in the proposal; |
• | If the proposal requests increased disclosure or greater transparency, whether or not sufficient information is publically available to shareholders and whether it would be unduly burdensome for the company to compile and avail the requested information to shareholders in a more comprehensive or amalgamated fashion; |
• | Whether implementation of the proposal would achieve the objectives sought in the proposal. |
VIII. | Miscellaneous Items |
A. | Ratification of Auditors |
B. | Limitation of Non-Audit Services Provided by Independent Auditor |
C. | Audit Firm Rotation |
D. | Transaction of Other Business |
E. | Motions to Adjourn the Meeting |
F. | Bundled Proposals |
G. | Change of Company Name |
H. | Proposals Related to the Annual Meeting |
I. | Reimbursement of Expenses Incurred from Candidate Nomination |
J. | Investment Company Proxies |
IX. | International Proxy Voting Guidelines With Application For Holdings Incorporated Outside the United States and Canada |
• | A combined CEO/Chairman role without a lead Independent Director in place would trigger a vote “Against” the CEO/Chairman. |
• | Attendance at Board meetings not disclosed on an individual basis in the annual report or on the company’s website and neither is the reported overall attendance above 90 %. An individual candidate has attended fewer than 75 % of the board and audit / risk committee meetings in a given year without a satisfactory explanation for his / her absence disclosed in a clear and comprehensible form in the relevant proxy filings. Satisfactory explanation will be understood as any health issues or family incidents. These would trigger a vote “Against” the election of the corresponding directors. |
• | DWS will vote with an “Against” if the election of a candidate results in a direct transition from executive (incl. the CEO) to non-executive directorship (i.e. without a cooling off of minimum two years). In especially warranted cases, executive directors with a long and proven track record can become non-executive directors if this change is in line with the national best practice for corporate governance. |
• | A former executive director who is nominated for a membership on the non-executive board when two or more former executive directors already serve on the same board would result in a vote “Against” the former executive, as the board cannot be regarded as independent anymore. |
• | Relevant committees in place and they are majority independent. If the main committees are not majority independent, this could trigger a vote of “Abstain” for the Chairman of the Board and if the Chairman is not up for election, “Abstain” on the non-independent committee members. |
• | The management of Environmental Social and Governance (ESG) controversies will be analysed on a case-by-case basis based on relevant internationally recognized E, S or G principles (e.g. the UN Global Compact Principles and OECD Guidelines for Multinationals). Under extraordinary circumstances, DWS will vote against the election of directors or the entire board if there were material failures of governance, stewardship, risk oversight, or fiduciary responsibilities identified as a result of the controversies around the company. |
• | When the director election lengthens the term of office, DWS will consider voting “Against” this election. |
• | Systems that entitle the company to recover any sums already paid (e.g. claw-back-system). Deviations are possible wherever the company provides a reasonable explanation why a claw- back was not implemented. |
• | The issuance authority exceeds 33 percent of the issued share capital. Assuming it is no more than 33 percent, a further 33 percent of the issued share capital may also be applied to a fully pre-emptive rights issue taking the acceptable aggregate authority to 66 percent. |
• | The combined equity issuance of all equity instruments with pre-emptive rights exceeds 50 percent of the outstanding share capital or the prevailing maximum threshold as stipulated by best practice rules for corporate governance in the respective country. Exceeding either of the two thresholds will be judged on a CASE-BY- CASE basis, provided that the subscription rights are actively tradable in the market. |
• | The cumulative equity issuances without subscription rights (historical and across instruments) exceed the maximum level specified in a respective country’s best practices for corporate governance or 30 percent of the company’s nominal capital. |
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