American Century Sustainable Growth ETF (ESGY US) - Portfolio Construction Methodology

Core Insights - The American Century Sustainable Growth ETF (ESGY) aims for long-term appreciation by focusing on U.S. large-cap equities that demonstrate sustainable business improvement [1] Investment Process - The investment process utilizes a proprietary multi-factor model that assigns a financial metrics score based on growth durability, profitability, and valuation, alongside an ESG score [1] - The financial metrics score and ESG score are combined equally to create a composite rank that determines eligibility and sizing for investments [1] - Ongoing risk monitoring is integrated with fundamental reviews to maintain balance across style, sector, and factor within defined active-risk tolerances [1] Portfolio Management - Position weights in the portfolio reflect conviction, liquidity, and diversification constraints, while managing issuer and industry exposures to prevent undue concentration [1] - Rebalancing of the portfolio occurs when model ranks, fundamentals, or risk estimates change, ensuring alignment with investment strategy [1] - The sell discipline is applied to remove investments that show deteriorating improvement trajectories, unfavorable risk/reward profiles, or fail to meet ESG criteria [1]