Pax World Applauds SEC Decision to Require Disclosure of Companies' Climate Risks

Pax Was One of the First Asset Management Firms to Urge Such Disclosure

PORTSMOUTH, N.H. – January 27, 2010 – Pax World Management LLC, investment adviser to Pax World Funds (Pax World) and a leader in the field of Sustainable Investing, today commended the decision of the Securities and Exchange Commission (SEC) to issue guidance on disclosure of climate change risks and opportunities at publicly traded companies. Pax World was one of two asset management firms that joined with 21 other institutional investment representatives in 2007 to petition the SEC to issue guidance on climate risk disclosure. The petitioners included the treasurers, comptrollers or other state officials representing California, Florida, Kentucky, Maine, Maryland, New Jersey, New York, North Carolina, Oregon, Rhode Island and Vermont.1

The petition, submitted to the SEC in September of 2007, asked the SEC to provide detailed guidance on how companies should be disclosing climate-related material risks to investors. "Recent scientific, legal, and regulatory developments make it unavoidably clear that the risks and opportunities many corporations face in connection with climate change fall squarely within the category of material information that is required to be analyzed and disclosed in many corporate filings," said the petitioners. "Yet corporate disclosures of the risks and opportunities created by climate change lag behind these developments, and investors are left with little or in some cases no useful information about corporate exposure to these risks."

In a groundbreaking decision issued today, the SEC stated that the new interpretive guidance will provide assistance to companies in reporting several types of material impacts from climate change, including not only possible regulatory or litigation risk, but also extending to the physical impacts of climate change and the possibility of reputational impacts. SEC staff and commissioners pointed out that investors with substantial assets under management have been seeking such guidance for many years, and reiterated that this release is in keeping with the Supreme Court's language noting that while doubts about materiality are "commonplace," doubts as to the significance of information to be included should be resolved in favor of investors.

Pax World, a leader in the field of sustainable investing, has long contended that climate change will have significant material effects on corporate financial performance, and therefore on investment performance. There is now abundant evidence that growing numbers of investors and financial experts agree. In fact, Pax World points out that investment analysts now routinely cover climate change as one of the issues that distinguishes companies as either leaders or laggards in their sectors. The January 14, 2010 Investor Summit on Climate Risk at the United Nations was attended by 450 global investors, including some of the world's largest financial firms and institutional asset owners.

"Amid the rising reality of climate change's impacts on the global economy, what the SEC recognized today was that climate change is a material risk to businesses, and ignoring this is a disservice to investors," said Julie Gorte, Pax World's Senior Vice President for Sustainable Investing, "Just as importantly, as companies become more aware of the risks they face, they will be increasingly conscious of the business opportunities associated with the shift to a cleaner, more sustainable economy. Climate risk disclosure is a win-win for investors."

ABOUT PAX WORLD MANAGEMENT LLC
Pax World Management LLC, the investment adviser to Pax World Funds, launched the nation's first socially responsible mutual fund in 1971 and is a recognized leader in Sustainable Investing – the integration of environmental, social and governance (ESG) factors into investment analysis and decision making. With approximately $2.4 billion in assets under management2, Pax World Funds offers seven actively managed mutual funds as well as ESG Managers Portfolios, a series of asset allocation funds featuring asset allocation, manager selection and portfolio construction by Morningstar Associates.

1The full list of petitioners includes the California Public Employees' Retirement System, the California State Controller, the California State Teachers' Retirement System, the California State Treasurer, Ceres, Environmental Defense, F&C Management, the Florida Chief Financial Officer, Friends of the Earth, the Kentucky State Treasurer, the Maine State Treasurer, the Maryland State Treasurer, the Nathan Cummings Foundation, the New Jersey State Investment Council, the New York City Comptroller, the New York State Attorney General, the New York State Comptroller, the North Carolina State Treasurer, the Oregon State Treasurer, Pax World Management Corporation, the Rhode Island General Treasurer and the Vermont State Treasurer.

2As of 1/26/10

You should consider Pax World Funds' and ESG Managers Portfolios' investment objectives, risks, and charges and expenses carefully before investing. For this and other important information, please obtain a Fund prospectus by calling 800.767.1729 or visiting http://www.paxworld.com. Please read it carefully before investing. Copyright © 2010 Pax World Management LLC. All rights reserved. Distributed by ALPS Distributors, Inc.