Benefits of investing in the Vanguard Ethically Conscious Australian Shares Fund

The significant features and benefits of investing in the Fund include:

• Competitive long-term performance - Vanguard's investment approach provides investors with an efficient way to capture long-term market performance.

• Diversification - The Fund provides exposure to a diversified portfolio of securities, which means the Fund is less exposed to the performance fluctuations of individual securities. This moderates the volatility of the portfolio and smooths out' investment returns over time. The Fund provides exposure to a wide selection of available securities in the relevant index, generally holding significantly more securities than most active funds with the same benchmark. From time to time, however, the number of securities in a given index may reduce due to factors such as index rebalancing.

• Tax efficiency - Vanguard's buy and hold strategy means that securities are generally held within a portfolio over a long period of time. If certain securities are held for more than 12 months, any capital gain (if applicable) on the disposal of those securities may be reduced under the capital gains tax discount rules - a tax efficient outcome for eligible investors.

• Low-cost investing - The Fund has low ongoing fees as we strive to minimise the costs of managing and operating the Fund. The Fund typically has low portfolio turnover resulting in low trading costs such as brokerage and other transaction costs.

Benefits of investing with Vanguard

• Stability and experience - The Vanguard Group, Inc. was established in 1975 and has been a leader in low cost investing ever since. In Australia, Vanguard leverages the scale, experience and resources of our established global business. Investing in the funds allows you to access the knowledge and skill of Vanguard as a specialist investment manager.

• Client focus - The Vanguard Group, Inc. was founded on a simple but revolutionary idea - that an investment company should manage the funds it offers in the sole interest of its clients. From rigorous risk management to transparent pricing to plain talk communications, we put our clients' interests first.

• Low costs - Investors can't control the markets, but they can control the costs of investing. Providing low-cost investments isn't a pricing strategy for us. It's how we do business. Vanguard's scale also helps to keep costs low.

Risk level

High

Investor suitability

Investors with Australian dollars, seeking exposure to a diversified portfolio of Australian shares with an ethically conscious screen and with a higher tolerance for the risks associated with share market volatility.

About the Fund

The Fund provides low cost exposure to stocks listed on the Australian Securities Exchange (ASX) and excludes companies with significant business activities involving fossil fuels, nuclear power, alcohol, tobacco, gambling, weapons, adult entertainment and a conduct related screen based on severe controversies. Diversification requirements are applied to restrict the proportion of the index invested in any one industry to +/-5% of the industry weights of the FTSE Australia 300 Index, subject to any limitation issues resulting from the exclusionary screening.

Investment objective

Vanguard Ethically Conscious Australian Shares Fund seeks to track the return of the FTSE Australia 300 Choice Index before taking into account fees, expenses and tax.

How we invest your money

The Fund seeks to track the return of the FTSE Australia 300 Choice Index before taking into account fees, expenses and tax.

The index which the Fund seeks to track applies exclusionary screening and will therefore perform differently than the broad market as certain companies are removed, resulting in different weights to sectors and factors.

The Fund holds all of the securities in the index most of the time, allowing for individual security weightings to vary marginally from the index from time to time. The Fund may be exposed to securities that have been removed from or are expected to be included in the index and the Fund may also invest in futures contracts.

The FTSE Australia 300 Choice Index comprises securities (shares) listed on the Australian Securities Exchange (ASX). The index contains securities included in the FTSE Australia 300 Index but excludes companies with significant business activities involving fossil fuels, nuclear power, alcohol, tobacco, gambling, weapons, adult entertainment and a conduct related screen based on severe controversies. The Index is calculated on a before tax basis.

Lastly, diversification requirements are applied to restrict the proportion of the index invested in any one industry to +/-5% of the industry weights of the FTSE Australia 300 Index, subject to any limitation issues resulting from the exclusionary screening. Details of the benchmark methodology can be accessed by visiting https://www.ftse.com/products/indices/global-choice

The Fund may engage in securities lending. Securities lending is a common practice where holders of securities make short term loans of shares in return for a fee, to incrementally increase returns to investors.

Strategic asset allocation*

• Australian shares 100%

*This is a targeted strategic asset allocation. In addition, cash may be held for the purposes of liquidity management and derivatives may be used to manage market exposure.