Also In this Issue: Outlook — Modest Equity Returns Amid Higher Volatility | Quarterly Performance Benchmarks | Fixed Income Commentary Download PDF Volatility reigns: It just feels better on the upside By Theresa Gusman Volatility reigned in the first quarter. The US stocks surged higher, posting their best quarter in nearly a decade and offsetting the fourth quarter downdraft. Equity markets rebounded worldwide led by China, as US-China trade tensions eased, and the Fed signaled that it is unlikely to raise rates in 2019. The first quarter was the mirror image of the fourth. Growth stocks outperformed value, small outperformed large, economically sensitive sectors topped the performance charts, oil prices rebounded, and China was the top performing market in the world. We remain convinced that the fourth quarter ushered in a period of equity market volatility (which always feels better on the upside), asynchronous and decelerating global economic and profit growth, and negative earnings surprises.

Slowing Continues By Mel Miller, CFA® | Chief Economist Download PDF The December Economic Commentary highlighted my concern that the economy might have slowed “too much.” As I share the first quarter results in this publication, I still can not answer the question. The fourth quarter Gross Domestic Product (GDP) grew 2.2%. The first quarter GDP slowed from the fourth quarter but by how much? Is a recession on the near horizon? Let’s examine the data.

Government Shutdown Impacts 2019 Proxy Season By Holly Testa Download the PDF The start of this year’s shareholder proposal season was shrouded in uncertainty, as the government shutdown late last year included the Securities and Exchange Commission (SEC) that is responsible for oversight of the process. Companies have the option of filing no action requests with the SEC that, if granted, allow them to omit certain proposals that the SEC deems deficient in accordance with current rules. Shareholders have the option to defend their proposals. The SEC is back in action, but the back log of no action requests is substantial, according to a recent preview, with about three –quarters of over 50 no action requests filed still yet to be decided as of April 1.

PROXY MEMORANDUM Date: March 20, 2019

First Affirmative Financial Network withdrew a shareholder proposal filed at SBA Communications, Inc. that asked the company to issue a report describing the company’s environmental, social, and governance (ESG) policies, performance, and improvement targets. SBA Communications owns and operates wireless infrastructure in the US, Canada, and Central and South America and is a recent addition to the S&P 500. The Company is amongst a small minority of our major portfolio holdings that lack sustainability reporting, and is in the 15% minority of S&P 500 companies lacking such reporting.

Celebrating a Decade of Shareholder Advocacy First Affirmative reached an important milestone at the end of 2018, marking 10 years since we launched our advocacy program, completing our first full year of direct corporate engagement in 2009. We have since pursued an increasingly ambitious advocacy agenda to expand our engagement reach and impact.

Economy Moderates — Too Much? By Mel Miller, CFA® | Chief Economist Download PDF The third-quarter economic growth moderated from the torrid second-quarter expansion of 4.2% annualized, reflecting a healthy 3.5% growth rate. Did the pace continue to slow in the fourth quarter or did the economy rebound to the second quarter level? What is my forecast for 2019? My goal is to answer these questions.

Also In this Issue: 2019 Outlook — Modest Equity Returns Amid Higher Volatility | Quarterly Performance Benchmarks | Fixed Income Commentary Download PDF It's (still) the Earnings... By Theresa Gusman Ushering in a period of asynchronous and decelerating global economic and profit growth and negative earnings surprises, equity markets fell amid volatile trading in the fourth quarter, erasing gains for the year in the US. US equities slid 13.5% in the fourth quarter, overwhelming increases through the first nine months and resulting in a 4.4% decline for the year. The globally sensitive Energy (-18.1%), Materials (-14.7%), and Industrials (-13.3%) S&P 500 Sectors were the worst performing in 2018, and Health Care (+6.5%), Utilities (+4.1%), and Consumer Discretionary (+0.8%) fared best. Although the pace of decline in non-US equity markets slowed in the fourth quarter, emerging markets fell 14.6% in 2018, as developed international markets dropped 13.8%. Except for Wheat (+3.6%) and Live Cattle (+2.6%), commodity prices ended the year lower. WTI Crude Oil plunged 20.5% in 2018 and 37.5% in the fourth quarter and economic bell weathers Zinc (-23.4%) and Copper (-21.3%) were among the worst performers in 2018.

The UN Sustainable Development Goals: Targets for Positive Impact By James Griffitts Download the PDF On September 25th, 2015, all 193 member states of the United Nations adopted a set of 17 goals aiming to “end poverty, protect the planet and ensure prosperity for all as part of a new sustainable development agenda,” to be met by 2030. Building on the successes and aspirations of the Millennium Development Goals (MDGs) laid down in 2000, the UN Sustainable Development Goals (SDGs) aim to surpass them through a more comprehensive set of goals and a concerted effort to include all stakeholders in the solutions: The MDGs were aimed primarily at governments, whereas the SDGs are a call to action for international institutions, governments, individuals, and public and private organizations at every level.

One for the Record Books By Mel Miller, CFA® | Chief Economist Download PDF In spite of growing trade war tensions, especially with China, one would not expect a robust economic showing during the third quarter. Yet the economy continues the expansion that began in 2009. In fact, I want to highlight a couple of records that were broken in the third quarter.