Towers Watson Investment Services, Inc. / 5 In order to seek to achieve its investment objective, each Private Fund generally invests in a range of underlying portfolio funds and/or managed accounts or trades directly pursuant to a delegation of investment authority from TWIS to one or more investment managers.
Towers Watson Investment Management Limited (“TWIM”), an affiliate of TWIS, serves as a sub-advisor to certain Private Funds. TWIM advises TWIS with respect to certain of its responsibilities with respect to the Private Funds, including the hiring and termination of investment managers.
TWIS provides consulting services to clients in the area of developing medium-term and long-term investment strategies for funds by broad classes of investment. TWIS does not provide advice with respect to the selection of individual securities except under certain circumstances such as for bank and insurance company pooled funds, mutual funds, exchange-traded funds, collective investment trusts ("CIT"), derivatives, annuity products, alternative investment funds — including WTW affiliate-managed funds — or U.S. government or AAA-rated sovereign negotiable debt obligations. We typically develop such strategies with the assistance of a computer model projecting future obligations and probabilistic outcomes of alternative investment strategies.
TWIS assists clients in the selection of investment managers for their portfolios by providing quantitative and statistical evaluations of their performances and providing qualitative advice as to the managers whose approach and style might be compatible with the client’s investment objectives. In determining investment strategies for allocations and other matters, clients may impose restrictions on securities and types of securities.
Clients may engage TWIS for additional related services, such as insurance contract analysis and research-related projects relating to asset studies. As our clients have unique investment goals that reflect their individual situation, our service agreements with our clients are customized to meet their needs.
We do not participate in wrap fee programs.
We manage approximately $46.5 billion on a discretionary basis and $4.9 billion on a non-discretionary basis, in each case as of December 31, 2023.
WTW believes that sustainable investment is central to successful long-term investment outcomes for our clients. Therefore, WTW considers the financial impact of environmental, social, and governance (“ESG”) factors across its investment process. In formulating its investment advice, WTW seeks to analyze and understand the ESG factors in order to properly assess the risk and return of the investment under consideration.
In analyzing the risk/reward profile of an investment, WTW evaluates the impact of ESG risks and, as with any other risks, seeks to ensure that the expected return for every investment is commensurate with those risks.
The relevance of ESG factors will vary by asset class, sector, and strategy, and the use of ESG factors will depend in part on any regulatory, operational, or account considerations. Further, WTW’s use of ESG factors might differ from how others use such factors. WTW generally prefers engagement over exclusion within WTW-affiliate managed funds but acknowledges that an exclusionary approach may be necessary when engagement is unlikely to be effective or where certain business practices are incompatible with sustainable investment. Therefore, certain exclusion criteria is applied across asset classes. Additional information regarding ESG and related exclusions is available within the offering documents.
TWIS sponsors the Manager Ideas Exchange Conference ("MiX Conference"). The MiX Conference provides engagement and networking opportunities between asset managers and TWIS. This event is attended by investment management firms and investment service

providers.
We rely on investment research generated by the Investment Manager Research Team (“Research Team”). The Research Team is dedicated to researching and evaluating non-affiliated investment managers worldwide and consists of investment professionals from TWIS and its global investment advisory affiliates. Our Research Team monitors and rates non-affiliated investment managers’ strategies. Certain of the investment managers the Research Team reviews may participate in the MiX Conference. Participation in the MiX Conference is not and may not be considered in the manager evaluation and selection process. See also Item 5 – Fees and Compensation for information related to compensation TWIS receives in relation to the MiX Conference.
6 / Towers Watson Investment Services, Inc.
TWIS does not accept compensation from third parties for the sale of securities or other products. However, a limited number of TWIS employees act as registered representatives of an unaffiliated broker-dealer. These employees do not receive compensation from the third-party broker-dealer in connection with the sale of pooled investment vehicles managed by TWIS or its affiliates.
TWIS does not require clients to purchase investment products that TWIS recommends through any specific brokers or agents. TWIS does not charge commissions or markups.
As discussed in Item 4, TWIS sponsors the MiX Conference which certain investment managers and/or service providers may attend for a fee. There are also outside sponsorship opportunities available. TWIS receives all revenue from this conference. The receipt of any compensation is not tied to the sale of any WTW services or WTW Funds.
Item 10 discusses the Operational Due Diligence Structured Assessment Method Reports which may be sold to certain asset managers which TWIS hires to manage client assets. TWIS receives all revenue from these reports. The receipt of any compensation is not tied to the decision making process to hire asset managers.
All fees and compensation are negotiated in advance of any work done and are established in a written contract between TWIS and our client. We do not deduct fees from assets. TWIS will bill for services in accordance with the terms and conditions that are agreed upon with our client. TWIS does not earn a management fee for services provided to the Private Funds, but TWIS does earn a management fee in connection with the investment management agreement signed by each investor in the Private Funds.
With the exception of DIS, fees are generally on a fixed-fee retainer basis with monthly or quarterly billing. For DIS, TWIS typically enters into an agreement with compensation that is asset-based and expressed in basis points. TWIS does not have a standard fee schedule as fees are negotiable to reflect the level and the nature of the responsibilities that TWIS assumes upon agreement with the client, and they may be based on the size and complexity of the portfolio and reflect the level of services provided.
Clients may pay in advance, as determined by prior agreement. If work terminates during a calendar billing cycle, then TWIS will promptly refund any unearned prepayments.
Our fees do not include custodian fees, brokerage commissions, legal fees, auditor fees, transaction costs, trustee fees or mutual fund expenses. Our clients will incur these fees, costs or expenses through the investments they make, including investments within the Private Funds. Our brokerage practices are discussed in Item 12.
In the case of the Private Funds, the Private Funds are responsible for their own organizational, administrative, operating and investment expenses, as outlined in the offering documents. The Private Funds reserve the right to charge investors an Anti-Dilution Levy which is further described in the offering documents of the Private Funds.
Item 5