JPMorgan Chase & Co._Redacted

JPMorgan March 2s, 2023 Office ofthe State Treasurer Attn: Mr. Christopher Bigs 2300 N. Lincoln Bic. Room 217 Okiahoma City, OK 73105 Christopher [email protected] gov Re: Lette rom the Oklahoma State Treasurer to 1. Morgan dated January 30, 2023 Ladies & Gentlemen: This eters in response toyoureter dated January 30, 2023 requesting written verification of 17. Morgans positon regarding the boycott of energy companies under the Oishoma Energy Discrimination Elimination Act of 2022, 74 0.5. §§ 12001-12006." As requested, we are hereby responding to the questions endosed with your letter. We appreciate the opportunity to provide the following information to your ofce. We would ke to note atthe outset that we provide financial products and services to many companies that engage nthe exploration, production, utiiztion, transportation, sal, or manufacturing of fos fuebased energy and intend to do son the future. Our credit exposure to il & Gas as an industry’ was $38.7 billion as of December 31, 2022, including $22.4 billion of Exploration & Production and Oil field Services. As of the same date, our Utilities exposure was $36.2 billion. At the same time, LP. Morgan i commited to investing in th transition to ow carbon world over time. In 2021, we financed and facilitated $106 billion for green objectives. As further described in our responses, J.P. Morgan does not “boycott energy companies,” as defined in 74 0.5. §§ 12001-12006. {Signature appears on the following page] The forwaraooking objectives described ints etter and usd by PMC ar, by thle tre ube ks and uncertain, many f whch are beyond the rn’ coro. JPM actus tur ress may ier mater rom hese objectives, which ar dependent on other prerequisites and ical considerations, both within and outside of our contol Fhe industry of isk category general based on th client or counterparty primary busines act. Credit exposure san internal met nd not comparable metic o aur $106 Billo fn financing and facitaton in 2021 for green objectives, See p. 121 of 10-K for fiscal year ended December 31, 2022 (“10K”).  Sincerely, On Behalf of .P. Morgan Chase Bank, N.A. —_ = Yoo toca By: Brian Page Managing Director Enclosures: Responses Climate Proposals for Oklahoma Appendices 2  Oklahoma State Treasurer March 28, 2023 1 Questions - Annex 1 1. What is the name of your company? What is the ISIN for your company? Our holding company is JPMorgan Chase & Co. (“JPMC”1 ). JPMC’s common stock ISIN is 2. What is the name, title, and mailing address of the person verifying the answer to these questions on behalf of your company, and to whom may the Treasurer direct further communications regarding this verification request? Name: Brian Page Title: Managing Director Mailing Address: 1900 N Akard St, Floor 03 Dallas, TX 75201-2300 3. Is your company publicly traded? On which securities exchange? The stock of JPMC is publicly traded on the New York Stock Exchange. 4. Does your company invest capital or loan capital to other people or entities? Does your company invest capital or loan capital to other people or entities on behalf of third parties? JPMC invests and loans money to consumers and businesses. JPMC also invests money on behalf of third parties. 5. Has your company committed or pledged to meet environmental standards, such as reducing your greenhouse gas emissions, beyond applicable federal or state law with respect to its lending, investing, or underwriting portfolio, or with respect to the companies with which your company does business? If so, to what environmental standards has your company committed or pledged? For the purpose of this response, we understand environmental standards to mean efforts or initiatives related to greenhouse gas emissions established by external non-governmental parties2 . As a firm we recognize the importance of considering the reduction of greenhouse gas emissions and the need for policies that ensure the availability of energy resources securely, reliably and affordably. JPMC is committed to working with clients around the world to reduce emissions and ensuring our own operations remain carbon neutral. 1 “JPMC” herein is inclusive of subsidiaries. 2 Other than in respect of Questions 7 and 9 – 14, wherever a question refers to “investing” or “investment,” we have responded with respect to JPMC’s proprietary investing activity, whether in the form of equity investing or lending. Information with respect to JPMC’s asset management business is addressed in Questions 7 and 9 – 14 or as otherwise relevant. Oklahoma State Treasurer March 28, 2023 2 A key aspect of our strategy is using our capital and expertise to support our clients’ decarbonization efforts. Related to this, we’ve set 2030 interim portfolio-level emissions intensity reduction targets for six sectors of our financing portfolio – starting in May 2021 with oil and gas, electric power, and automotive manufacturing and continuing in December 2022 with aviation, iron & steel, and cement. By working directly with clients to assist them to develop and finance their transition strategies and goals, we will help them navigate the challenges and opportunities of decarbonization and the energy transition, while also helping accelerate new technologies and business strategies. Despite the many challenges, more and more companies are hard at work to align their business strategies to the goals of the Paris Agreement. Our targets have been developed at the portfolio level, instead of the client level, to recognize the unique challenges that exist for each sector and subsector. Evaluating our clients’ emissions and decarbonization plans is one of many factors considered in our decision making for new in-scope financing transactions for in-scope clients in our targeted sectors. JPMC makes independent decisions that it believes are best for the long-term success of its business. Where JPMC’s internally developed goals align with those of industry initiatives, and where JPMC can continue to exercise its own business judgment based on the best interests of the firm, JPMC may engage with industry initiatives to help address complex global challenges, including climate change. In October 2021, JPMorgan Chase joined the Net Zero Banking Alliance (“NZBA”). Participation in NZBA is part of our effort as we work to develop our own targets for other sectors and engage with a growing number of clients who are aligning their strategies with science-based emission reduction pathways. It is also a reflection of our support for the ambition of greater climate action. While we are committed to these objectives, we also have noted that NZBA sets a high bar and its goals are subject to other prerequisites and critical considerations, both within and outside our control. These include the necessity of technological advancements, the evolution of consumer behavior and demand, and the need for thoughtful climate polices — all factors required to make achievement of targets feasible — as well as the potential impact of legal and regulatory obligations and the challenge of balancing our commitment to short-term targets with the need to facilitate an orderly and just transition and energy security. As we engage with NZBA and other industry initiatives to which our efforts are aligned, the firm will continue to make independent decisions that we believe are best for the long-term success of our business. a. What is the name of the entity that established the environmental standards beyond applicable federal or state law to which your company has committed or pledged? See above. b. Are your company’s commitments or pledges to such environmental standards mandatory for your company? If so, how are your company’s commitments or pledges mandatory? See above. c. Who monitors your company’s commitments or pledges to such environmental standards? How are your company’s commitments or pledges to such environmental standards monitored? Please attach any reports, metrics, or other documents that you have submitted or published pursuant to these commitments or pledges. Oklahoma State Treasurer March 28, 2023 3 Senior management – including the Operating Committee and leaders within each of our lines of business and corporate functions – is responsible for driving strategy and implementation of initiatives across the firm. We plan to periodically disclose information about progress against our commitments over time. d. What are the consequences for your company not fulfilling its commitments or pledges to such environmental standards? If we do not achieve our objectives, or are perceived to not do so, we could face a range of risks, including, but not limited to:  Legal and Regulatory Risk: If the bank is not transparent about its actions and its actions are not consistent with its public statements, the bank could face legal or regulatory risk.  Shareholder Risk: As with any issue regarding company practices, shareholders could make proposals related to ESG or environmental related matters.  Business Risk: As with any issue regarding company practices, we could face loss of revenue from corporate, government, and investor clients that consider it relevant for business selection, or are seeking financing or advisory services to facilitate their own transition to a lower-carbon business model. e. If the environmental standard includes aligning attributable emissions with net zero, please identify the net zero pathway(s) you use to measure alignment with net zero. For each economic sector or category of companies to which you apply the pathway, please describe the net zero pathway’s requirements for that sector or category and include any reports, metrics, or other documents used by you or any environmental entity to which you belong to measure compliance with this pathway. The pathways we use, including with respect to each economic sector or category of companies to which we apply pathways, can be found in our Carbon Compass Methodology. 3 The 2030 interim portfolio-level emissions intensity reduction targets we have set build on the transition pathways outlined by third-party emissions reduction scenarios, including the International Energy Agency’s Net-Zero by 2050 Scenario and Sustainable Development Scenario. We also reference a wide range of public resources, including additional climate scenarios, decarbonization research and other frameworks for assessing alignment with global emission reduction goals. f. Please identify any consequences you have applied or threatened with respect to any company in your lending, investing, or underwriting portfolio, or any company with which your company does business, for failing to commit or meet environmental standards beyond those required by applicable federal or state law. 3 https://www.jpmorgan.com/solutions/cib/investment-banking/center-for-carbon-transition/carbon-compass Oklahoma State Treasurer March 28, 2023 4 Please see responses to Questions 5 and 7. 6. Does your company have a written policy, procedure, or investment guideline restricting or prohibiting investment in energy companies, including companies engaged in the exploration, production, utilization, transportation, sale, or manufacturing of fossil fuel-based energy? Please see response to Question 7. 7. What is your company’s policy on banking, consumption, financing, investment, underwriting, or related activity pertaining to fossil fuel-based energy and fossil fuel-based energy companies, including companies engaged in the exploration, production, utilization, transportation, sale, or manufacturing of fossil fuel-based energy? JPMC makes independent decisions that it believes are best for the long-term success of its business. These business decisions reflect JPMC’s longstanding approach to generally identifying and assessing potential risks to and opportunities for the firm, including long-term strategic risks. Under the firm’s approach to environmental and social issues, the firm identifies a number of areas where prohibitions can apply, as well as clients and transactions that require environmental and social review on a case-by-case basis, based on a variety of factors including the industry / sector, location of operations, use of proposed financing proceeds, if relevant, and the presence of specific types of activity that potentially present heightened environmental and social risk.4 Separately, in connection with our portfolio-level emissions intensity reduction targets, an assessment of our clients’ emissions and decarbonization plans is now an additional consideration in our decision-making while considering new transactions for clients in these sectors. For more details, please see response to Question 5. In response to the question’s reference to “investment,” we provide the information below with respect to J.P. Morgan Asset Management (“JPMAM”) 5 and further refer you to subsequent responses to Question 9. JPMC does not generally make direct proprietary investments in energy companies. Within JPMAM, certain accounts and investment funds are, for the ordinary business purpose of managing accounts or establishing investment funds to satisfy individual client needs or general market demand, managed to investment guidelines or subject to policies or procedures restricting or prohibiting investment in energy companies. This is because, for example, JPMAM may manage a private investment fund that pursues a real estate investment strategy or an 4 For example, JPMC currently prohibits financing related to certain activities related to coal mining (including the development of greenfield coal mines and mountaintop mining) as well as activity with clients with the majority of their revenue from coal, the development of new coal-fired power plants without carbon sequestration technology, and new oil and gas development in the Arctic. 5 J.P. Morgan Asset Management is the marketing name for the investment management business of J.P. Morgan Chase & Co. and its affiliates worldwide. Oklahoma State Treasurer March 28, 2023 5 exchange traded investment fund that pursues a climate solutions strategy in accordance with the investment fund’s investment guidelines. In such cases, the investment guidelines may limit or prohibit investment in certain types of assets or asset classes, including energy companies. 8. How is your company’s chief executive officer, board of directors, and other company leadership involved in the development or monitoring of the company’s policies pertaining to fossil fuel based energy companies, including banking, consumption, financing, investment, underwriting, or related activity? Senior management – including the Operating Committee and leaders within each of our lines of business and corporate functions – is responsible for driving strategy and execution across JPMC. The Board of Directors is responsible for oversight of the business and affairs of JPMC. 9. Do you belong to the Net Zero Asset Managers initiative? JPMAM is a signatory to the Net Zero Asset Managers initiative (“NZAMI”). Responses to Questions 9 – 14 are specific to JPMAM. a. If so, what actions have you taken to “[w]ork in partnership with asset owner clients on decarbonization goals, consistent with an ambition to reach net zero emissions by 2050 or sooner across all assets under management?”6 As a global asset manager serving a diverse client base, JPMAM works with clients who have their own decarbonization goals to develop and offer investment solutions and products to meet their financial goals and non-financial objectives. This includes clients that have set their own net zero ambitions, who request information about holdings in their accounts. b. Have you “[s]et interim targets for 2030, consistent with a fair share of the 50% global reduction in CO2?”7 If so, what targets have you set? Yes. JPMAM’s interim target was published on November 9, 2022. Our interim 2030 target is for approximately 55% of our in-scope assets under management (“AUM”) to be in investments where the issuer has set science-based net zero targets (SBTi-validated or equivalent, as determined by JPMAM). JPMAM has included its AUM in listed equities and corporate bonds, as well as certain direct investments in forestry, in scope for its targets. Those assets make up 45% of JPMAM’s total AUM ($1.2 trillion), as of December 31, 2021. JPMAM will measure its progress towards its targets by the proportion of companies in which it invests that have set their own credible net zero targets. By 2030, JPMAM anticipates that the percentage of its AUM held in companies with science-based targets will increase from 20% to 55%. 6 https://www.netzeroassetmanagers.org/media/2021/12/NZAM-Commitment.pdf 7 Id. Oklahoma State Treasurer March 28, 2023 6 JPMAM believes investee companies that set their own credible science-based net zero targets and act on these targets will help manage risk and increase shareholder value over time to the benefit of client accounts. While JPMAM believes that taking into account financially material climate risks and opportunities is an important part of the investment process, JPMAM’s net zero targets do not change how JPMAM manages money or client account investment objectives or strategies. Furthermore, JPMAM’s net zero targets will not constrain investments or lead to a policy of divestment in carbon-intensive companies to meet interim net zero targets for 2030. JPMAM client accounts continue to be long-term investors in carbon-intensive companies to meet client investment objectives. c. What actions have you taken to “[p]rioritise the achievement of real economy emissions reductions within the sectors and companies in which [you] invest?”8 JPMAM has built an engagement program that prioritizes key issues that JPMAM believes materially affect the financial performance and risks of its clients’ investments. JPMAM believes climate change presents material risks and opportunities to its client portfolios. As such, climate change is one of JPMAM’s six investment stewardship priorities. JPMAM has established a climate change engagement framework as part of assessing the physical and transition risks facing companies held in client portfolios and understanding how companies are pursuing opportunities associated with climate change. JPMAM makes its investment decisions independently and such decisions are not dictated or overridden by what is set forth in NZAMI or any other organizational initiative; JPMAM does not prioritize the achievement of real economy emissions reductions over its fiduciary duty and contractual obligations to its clients. d. What actions have you taken consistent with your commitment to “[i]mplement a stewardship and engagement strategy, with a clear escalation and voting policy, that is consistent with [NZAM’s] ambition for all assets under management to achieve net zero emissions by 2050 or sooner?”9 i. Please identify any companies where you have taken escalation or voting measures to align that company’s operations or your portfolio with net zero. Please see our response to Question 9.c. above. JPMAM will engage with certain portfolio companies as prioritized by its engagement framework on such company’s own net zero targets and emission reductions. JPMAM’s engagement framework prioritizes engagements based on companies it believes face the highest transition risk and considers the size of JPMAM’s clients’ holdings. JPMAM’s decisions (including engagement and proxy voting decisions) are driven by JPMAM’s duty to manage accounts in the best interests of its clients – not to align company operations to JPMAM’s interim targets. e. What is your fossil fuel investment policy? Does it comply with the “Net Zero Asset Managers initiative: Network Partners’ expectation of signatories with regard to fossil fuel investment policy?”10 8 Id. 9 Id. 10 https://www.netzeroassetmanagers.org/media/2021/12/NZAM-Network-Partners-Fossil-Fuel-Position.pdf Oklahoma State Treasurer March 28, 2023 7 i. What is your policy regarding the financing of thermal coal plants or projects? ii. What is your policy regarding the financing of coal-fired electricity generation? JPMAM manages client assets in accordance with client objectives and its fiduciary duty to its clients. This includes long-term investments in carbon-intensive companies in order to meet certain clients’ investment objectives. While certain accounts and funds we manage in accordance with fiduciary duty and applicable strategies have investment policies to not invest in companies in certain industries, JPMAM does not have a policy that excludes coal and other fossil fuel investments or a policy regarding the financing of either thermal coal projects or coal-fired electricity generation. 10. Do you belong to Climate Action 100+? JPMAM joined Climate Action 100+ in 2020. a. If yes, please identify all actions you have taken to “seek commitments” from companies to “[t]ake action to reduce greenhouse gas emissions across the value chain?”11 JPMAM believes that the risks and opportunities related to climate change, under certain circumstances, can have a material impact on the growth potential, profitability, cash flow and balance sheets of investee companies and can directly impact the ability of these companies to create long-term investor value for JPMAM’s client accounts. JPMAM’s participation in Climate Action 100+ reflects this fiduciary concern. JPMAM has not participated in engagement with any US companies as a part of Climate Action 100+. Independent of Climate Action 100+, JPMAM engages with certain US companies on the topic of greenhouse gas emissions to understand the risks facing companies and their strategic plans to address these risks and to identify opportunities. In particular, JPMAM engages with companies to understand how they are adapting their businesses to changes in the wider economy and whether they have considered the financial planning required to adapt in a way that is effective for shareholders. In connection with these company engagements, JPMAM took the following actions to “seek commitments” from companies to “take action to reduce greenhouse gas emissions across the value chain,” which in each case was intended to encourage companies to plan for market and regulatory changes to enhance long-term profitability: 1. Discussed the setting of greenhouse gas emissions targets, with an emphasis on operational emissions (Scopes 1&2) 2. Voted against certain directors, as shown in Appendix A 3. Voted in favor of certain shareholder proposals, as shown on the attached Climate Proposals for Oklahoma.pdf b. Please describe any actions you have taken to encourage utility companies to “publish and announce . . . [a] coal and natural gas-generation retirement schedule,” with “[a] retirement date assigned to each coal or gas unit.”12 11 https://www.climateaction100.org/approach/how-we-work/ 12 https://www.climateaction100.org/wp-content/uploads/2020/12/CA100-Progress-Report.pdf#page=44 Oklahoma State Treasurer March 28, 2023 8 JPMAM has not taken actions specifically to encourage US companies to publish and announce a coal and natural gas-generation retirement schedule with a retirement date assigned to each coal or gas unit since becoming a signatory to CA100+. JPMAM recognizes that asset level decision making should be firmly in the hands of company management. As shareholders, JPMAM encourages transparency around companies’ plans so that JPMAM can assess any potential investment risks, informed by JPMAM’s own assessment of the relevant regulatory and investor expectations. Where companies have set their own long term net zero goals and corporate strategies based on renewable energy generation growth, on an independent basis, JPMAM has engaged with individual companies on how their asset base will evolve over time to ensure plans are aligned with the stated corporate strategy. If companies are seen to be saying one thing yet doing another, they could lack credibility and face regulatory and reputational risks, which JPMAM believes may impact returns to JPMAM’s clients. 11. Have you “exercise[d] voting rights to hold directors and management accountable for climate￾related issues?”13 Have you threatened to do so? If so, please identify each instance where you have cast or threatened to cast such votes.14 JPMAM believes that the environment and climate change pose material risks to certain companies. JPMAM believes that the oversight of these risks, as with all material risks, is ultimately the responsibility of the board of directors of these companies. Insufficient oversight of risks, including climate risks, may be evidenced in poor operational performance or lack of reporting of key measures. At times JPMAM may vote (and has voted) against individual directors that JPMAM judges are not sufficiently managing risk, including climate risk. Please see Appendix B for all relevant votes against directors of US companies since 2020. a. Please identify how you voted in the following director elections: Atmos Energy Corporation, 2021 AGM – JPMAM voted for all directors Atmos Energy Corporation, 2022 AGM- JPMAM voted for all directors ExxonMobil, 2021 Proxy Contest- JPMAM voted on the dissident Engine No. 1 proxy card, withholding votes from Engine No. 1’s candidate Anders Runevad and management nominees Susan Avery and Angela Braly. See write-up on the vote in the attached Appendix C. ExxonMobil, 2020 AGM- JPMAM voted against Angela Braly and voted for the other directors. The vote against Angela was in her role as Chair of the Public Issues and Contributions Committee due to what JPMAM felt was insufficient urgency regarding Scope 1&2 emissions in light of then-anticipated regulatory developments. Kinder Morgan, 2022 AGM- JPMAM voted for all directors Kinder Morgan, 2021 AGM- JPMAM voted against C. Park Shaper due to being deemed overboarded (i.e., serving on too many corporate boards) per JPMAM policy while voting for the other directors 13 https://www.climateaction100.org/approach/how-we-work/ 14 For questions 11-14, JPMC has limited its responses to information relating to its Asset Wealth Management business. Oklahoma State Treasurer March 28, 2023 9 b. Have you voted or threatened to vote against directors if they do not set or meet targets related to reducing greenhouse gas emissions where such emissions reductions would be beyond what is required by controlling law? If so, please identify each instance where you have cast or threatened to cast such votes. Yes, where such votes reflected JPMAM’s judgement as a fiduciary that a failure to set or meet such targets presented material financial risks to client investments due to anticipated regulatory and market developments. As a fiduciary for its client accounts, JPMAM believes it is important for management to comply not only with current regulatory standards but also to consider future changes that are likely to have significant financial impact on their businesses. These changes may include, among other things, increasing scrutiny on emissions – including flaring and fugitive methane emissions – and customer preferences for “sustainably sourced” natural gas in developing markets. JPMAM is also cognizant that companies may be impacted not only by laws where they are incorporated or where they operate, but by laws and regulations enacted in markets they serve and where their suppliers are located. In seeking to manage investments in the best long-term interests of its clients, JPMAM looks to identify companies that consider the impacts of regulatory developments and customer preferences so as to better manage risks and opportunities. Please see Appendix A for all relevant votes against directors of US companies since 2020. c. Please provide any voting bulletins or other descriptions of your votes where you described your vote in whole, or in part, as an action in response to a company’s action or inaction on climate￾related issues. Please see Appendix C for all voting bulletins or other public descriptions of JPMAM’s votes where JPMAM described its vote in whole, or in part, as an action in response to a US company’s action or inaction on climate-related issues. 12. Have you voted in favor of shareholder proposals that would require companies to issue a report on how they intend to reduce emissions beyond what is required by federal law? JPMAM has voted in favor of some shareholder resolutions asking companies to issue a report on how they intend to reduce emissions beyond what is required by federal regulations, when it believed having such information was in the best interest of client accounts. These were instances where JPMAM believed possible mismanagement of emissions could have posed a financially material risk to a company’s overall business, where companies have not provided emissions disclosures, or where such disclosures are incomplete or are not meaningful. This may also be prompted by concerns regarding how regulations may evolve in the future at the federal, state or local level or internationally. As noted in our proxy voting guidelines, which are published and updated annually, JPMAM believes that corporate shareholders have a legitimate need for information to enable them to evaluate the potential risks and opportunities that climate change and other environmental matters pose to the company’s operations, sales and capital investments. JPMAM acknowledges that many companies disclose their practices relating to environmental issues and that disclosure is improving over time. JPMAM generally encourages a level of reporting that is not Oklahoma State Treasurer March 28, 2023 10 unduly costly or burdensome and which does not place the company at a competitive disadvantage, but which provides meaningful information to enable shareholders to evaluate the impact of the company’s environmental policies and practices on its financial performance. a. If so, please identify each instance where you voted in favor of such a proposal. Please see attached Climate Proposals for Oklahoma.pdf. which includes all JPMAM votes in favor of and against such proposals for US companies since 2020. 13. Have you voted in favor of shareholder proposals that would require companies to adopt greenhouse gas emissions reductions targets beyond what is required by federal law? As a part of fulfilling its fiduciary duty under US federal law, JPMAM votes in the best long-term interests of its clients, including voting in favor of shareholder resolutions requiring US companies to adopt greenhouse gas emissions reduction targets where JPMAM believes not adopting such targets are likely to pose a material risk to the business[, so the answer is yes. a. If so, please identify each instance where you voted in favor of such a proposal. Please see attached Climate Proposals for Oklahoma.pdf, which includes all JPMAM votes in favor of and against such proposals for US companies since 2020. 14. Please identify how you voted on the following types of proposals since January 2020: a. proposals to insurance companies to set emissions reductions targets within their investment or underwriting portfolio. JPMAM votes environmental shareholder proposals on a case-by-case basis, taking into account various factors, including the relevance of the proposal to the company, the extent to which the company has already met JPMAM’s expectations on the management of issues raised by the proponent, related controversies and the prescriptiveness of the proposal itself. In the majority of cases, JPMAM has not supported shareholder resolutions requiring US insurance companies to reduce the emissions in their investment or underwriting portfolio. In three instances, JPMAM supported a bundled proposal requiring disclosure of emissions and emissions reduction targets. JPMAM supported these three proposals due to the aspect requiring disclosure of emissions. In such instances, the JPMAM stewardship team engaged with the companies to explain that JPMAM’s support of the three proposals was based solely on their disclosure aspects. b. proposals to banks to set emissions reductions targets within their investment or lending portfolio. JPMAM has not supported shareholder resolutions requiring banks to set emission reduction targets in their investment or loan portfolios. 15. Do you belong to the Net Zero Banking Alliance? Oklahoma State Treasurer March 28, 2023 11 Yes, for more detail, please see response to Question 5. a. If so, please describe all actions you have taken consistent with your commitment to “transition all operational and attributable GHG emissions from [your] lending and investment portfolios to align with pathways to net-zero by mid-century, or sooner.”15 Please see response to Question 5 and additional information below in response to Question 15.b.i. b. Have you committed to reduce greenhouse gas emissions or emissions intensity within specific economic sectors? Please see response to Question 5. i. If so, please describe the actions you have taken to reduce emissions or emissions intensity within these sectors. We are driving progress towards our targets through a few elements that are focused on using our knowledge and expertise to help clients frame and act on their decarbonization plans. These elements are focused on: 1) evaluating our clients emissions and decarbonization plans with both qualitative and quantitative factors, 2) engaging with our clients to understand their views, plans and constraints for decarbonization, and 3) meeting our clients’ unique capital needs through solutions that advance their own decarbonization efforts while optimizing their cost of capital. ii. Please describe whether you have raised prices or declined to provide services to companies to reduce your overall emissions, or emissions intensity. We do not raise client prices in relation to our participation in NZBA or any other industry initiatives. Evaluating our clients’ emissions and decarbonization plans is one of many factors considered in our decision making for new in-scope financing transactions for in-scope clients in our targeted sectors. Please also see responses to Questions 5 and 7. iii. If you have done neither of these things, please explain how you have met your emissions reduction commitments, or how you intend to meet those commitments. Please see response to Questions 5 and 15.b.i. above. iv. Do you require fossil fuel-based energy companies to purchase carbon offsets, which are not required by either federal or state law? No. Please also see response to Questions 5 and 15.b.i. above. 15 https://www.unepfi.org/wordpress/wp-content/uploads/2021/04/UNEP-FI-NZBA-Commitment-Statement.pdf Oklahoma State Treasurer March 28, 2023 12 v. How have you reallocated your capital in connection with your commitment to reduce your financed emissions in these sectors? Please see response to Question 5, which addresses our strategy for engagement with our clients on their decarbonization efforts. 16. Do you have a policy that restricts lending and investing in fossil fuel-based energy companies? JPMC does not generally make direct proprietary investments in energy companies. Please see response to Question 7. a. Do you have a policy that prevents investments in coal? JPMC does not generally make direct proprietary investments in energy companies. Please see response to Question 7. b. Do you have a policy against providing financial services to clients with a certain percentage of their revenue coming from coal or mining? Please see response to Question 7. c. Do you have a policy that prevents investments in energy projects in the Arctic region or the Arctic National Wildlife Refuge? JPMC does not generally make direct proprietary investments in energy companies. Please see response to Question 7. 17. Applying the Act’s statutory definition of “boycott energy company,” is your company boycotting energy companies as defined in Oklahoma law? JPMC does not “boycott energy companies,” as defined in defined in the Oklahoma Energy Discrimination Elimination Act of 2022, 74 O.S. §§ 12001-12006. JPMC engages in billions of dollars of financial activity with the energy sector, including with traditional fossil fuel-based energy companies and renewable energy. Business decisions concerning pursuing particular transactions are made by JPMC for various reasons and after consideration of a number of factors designed to protect the interests of the firm. Among the factors is an assessment of risk including, but not limited to, credit risk, reputation risk, and—for certain in-scope transactions—environmental risk-based considerations. Under its current risk￾based framework, JPMC does not provide some financial services to energy company clients in respect of certain activities and may decline to enter into new business or continue existing business relationships with certain clients in the sector (see response to Question 7), but the decisions JPMC makes are based on business reasons and reflect its overall objective of managing its business and associated risks in a manner that balances serving the interests of its Oklahoma State Treasurer March 28, 2023 13 clients, customers and investors while protecting its own safety and soundness and complying with its obligations under applicable laws. 18. Has your company been identified by another state as boycotting energy companies? Does your company currently appear on or has your company appeared on another state’s list of financial companies that boycott energy companies? If so, which state(s)? JPMC is aware of three other states that have enacted laws where relevant state officials have published lists of financial institutions that boycott energy companies based on definitions in the specific laws: Texas, West Virginia, and Kentucky. In each state, similar to this request, JPMC received and responded to questions about its practices and confirmed to the relevant officials that JPMC does not boycott energy companies. The Treasurers of West Virginia and Kentucky placed JPMC on the list of financial companies that boycott energy companies within the meaning of each respective state's laws. We disagree with those legal conclusions. JPMC has a long track record of financing energy projects in both states, as it does in Texas and Oklahoma. Questions – Annex 2 Does your company offer for sale on an exchange securities of an investment company, mutual fund, exchange-traded fund, or other publicly traded security that has a written policy, procedure, or investment guideline restricting or prohibiting investment in energy companies, including companies engaged in the exploration, production, utilization, transportation, sale, or manufacturing of fossil fuel-based energy? JPMC engages in secondary trading of securities of thousands of issuers on numerous exchanges worldwide. These may include securities of energy companies, securities of companies that are not energy companies, securities of exchange-traded funds that invest exclusively in energy companies, and securities of exchange traded funds that do not invest in energy companies at all. While certain of the issuers of these securities may have a written policy, procedure or investment guidelines restricting or prohibiting investment in energy companies, including companies engaged in the exploration, production, utilization, transportation, sale or manufacturing of fossil-fuel based energy, JPMC does not specifically track whether any issuers whose securities it trades on exchanges have any such policy, procedure or investment guidelines. JPMAM Appendices Appendix A 1. WPX: Nominating, Governance, Environmental, and Public Policy Committee Chair Kelt Kindick￾5/21/2020 2. MRO: Health, Environmental, Safety and Corporate Responsibility Committee Chair Elise Hyland – 5/27/2020 3. XOM: Public Issues and Contributions Committee chair Angela Braly – 5/27/2020 4. DVN: Governance Committee Chair Barbara Baumann – 6/3/2020 5. DVN: Governance Committee Chair Barbara Baumann – 6/9/2021 JPMAM Appendices Appendix B 1. WPX: Nominating, Governance, Environmental, and Public Policy Committee Chair Kelt Kindick￾5/21/2020 2. MRO: Health, Environmental, Safety and Corporate Responsibility Committee Chair Elise Hyland – 5/27/2020 3. XOM: Public Issues and Contributions Committee chair Angela Braly – 5/27/2020 4. DVN: Governance Committee Chair Barbara Baumann – 6/3/2020 5. DVN: Governance Committee Chair Barbara Baumann – 6/9/2021 6. NEX: Nominating and Governance Committee Chair Stuart Brightman – 6/14/2022 7. MTDR: Environmental, Social, and Governance Committee member R. Gaines Baty – 6/10/2022 8. OGS: Audit Committee Chair Michael Hutchinson – 5/26/2022 9. SEE: Nominating and Governance Committee members Jerry Whitaker and Henry Keizer – 5/26/2022 10. TRGP: Sustainability Committee member Rene Joyce – 5/24/2022 11. CLR: Nominating, Environmental, Social, and Governance Committee Chair Mark Monroe – 5/19/2022 12. PNW: Nominating and Governance Committee Chair Kathryn Munro – 5/18/2022 13. DRQ: Audit Committee members Terence Jupp, Carri Lockhart, and Darryl Willis – 5/17/2022 14. WHD: Audit Committee Chair Alan Semple – 5/17/2022 15. GNK: Audit Committee Chair Kathleen Haines – 5/16/2022 16. SLCA: Audit Committee Chair William Kacal – 5/12/2022 17. OIS: Nominating and Governance Committee Chair Darrell Hollek – 5/10/22 18. PNM: Lead Director Norman Becker and Audit Committee Chair Alan Fohrer – 5/10/2022 19. BTU: Health, Safety, Security and Environmental Committee Chair Andrea Bertone – 5/5/2022 20. WTI: Governance Committee Member Frank Stanley – 5/3/2022 21. BRK/B: Lead Independent Director Susan Decker – 4/30/2022 22. AROC: Governance Committee Chair Anne-Marie Ainsworth – 4/28/2022 23. LBRT: Audit Committee Chair William Kimble – 4/19/2022 24. PUMP: Nominating and Governance Committee Chair Jack Moore – 4/19/2022 JPMAM Appendices Appendix C Voting Bulletin #1 – 2020 JPMAM voted in favor of shareholder proposals at two petrochemical companies asking for reports on risks related to Gulf Coast investments by their joint venture. While each company had produced a TCFD-aligned report, they did not discuss the asset risk they faced. JPMAM believed these risks to be potentially significant, given the increasing severity of storms hitting the U.S. Gulf Coast. The proposal received 53% and 47% support, respectively, at each company. In late 2020, the joint venture released a supplemental white paper focused on physical risks from storms, and its governance/oversight of those issues. Voting Bulletin #2 – 2021 Voting issue – climate risk and director elections A decade of stock underperformance and balance sheet deterioration raised questions about the strategy from the management and board oversight at oil and gas company ExxonMobil. At the company’s 2021 AGM, activist hedge fund Engine No. 1 put forward four of its own nominees for the board. Action ExxonMobil’s high capital intensity strategy created concerns in its core business: spending was geared toward long-cycle investments that would be exposed to energy transition risks, given the long duration and broad range of oil and gas demand and price outcomes. Also, the company’s exposure to decarbonization technologies was not of sufficient scale for it to potentially thrive as part of the solution to climate change. Commercial progress has been slow in the new low-carbon businesses it has been working on for two decades. Outcomes and next steps After significant due diligence on Engine No. 1’s positions and nominees, in addition to our longstanding engagement with ExxonMobil’s board and management team, JPMAM voted for three of activist Engine No. 1’s director nominees at ExxonMobil. 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