PRIMECAP’s mission is to provide superior long-term investment results for our clients. We deploy a fundamentals-driven, individual-oriented investment process to exploit persistent market inefficiencies between stock prices and the long-term value of companies. We are long-term investors; our average holding period is more than an order of magnitude longer than the market at-large (roughly ten years versus less than one year).

ESG is today’s nomenclature used to describe a host of policies and practices that prioritize the sustainability of a company’s operations within a broader societal context. Although ESG investing has attracted widespread interest among investors, we struggle with the assumption that definitive, objective, nondebatable measures of companies’ social and environmental practices exist. However, while we do not consider ourselves ESG investors, PRIMECAP emphasizes the sustainability of our holdings’ business models, earnings, and returns. We believe businesses create value by solving society’s most intractable problems, both complex and mundane. They do this by delivering quality products and services, by building beloved brands, and by serving their stakeholders well. We believe the best investments are often the businesses that achieve this enduring value creation for society when the market least expects it.

PRIMECAP considers ESG factors when voting proxies. PRIMECAP votes on these issues based on their potential to improve the prospects for long-term success of a company and investment returns. PRIMECAP expects companies to comply with applicable laws and regulations with regards to governance, environment, and social standards. Each proposal is evaluated on its own merits according to PRIMECAP’s Proxy Voting Policy. We do not automatically vote proxies in accordance with management or third-party recommendations.