parnassus investments firm brochure

FPO

Where Principles and Performance® Converge

$5 billion AUM2011

Parnassus is a fundamental, bottom-up investment firm that was founded in 1984

based on the belief that a well-managed responsible investment strategy could

outperform traditional approaches.

To build wealth responsibly for our clients, our investment team selects businesses

that they believe have increasingly relevant products or services, sustainable

competitive advantages and quality management teams for the firm’s high-conviction

portfolios. Every investment must meet rigorous fundamental and environmental,

social and governance (ESG) criteria.

Who We Are

Parnassus Investments founded by Jerome L. Dodson Parnassus Fund launched

1984Core Equity Fund launched Fixed Income Fund launched

1992Todd C. Ahlsten named Portfolio Manager of the Core Equity Fund

2001

$1 billion AUM2003

Endeavor Fund launched Mid Cap Fund launched

2005 2008Todd C. Ahlsten named Chief Investment Officer

Matthew D. Gershuny and Lori A. Keith named Portfolio Managers of the Mid Cap Fund

Our History

Ian Sexsmith named Portfolio Manager of the Parnassus Fund

Samantha D. Palm named Portfolio Manager of the Fixed Income Fund

$10 billion AUM

2013

Benjamin E. Allen named Portfolio Manager of the Core Equity Fund

2012Robert J. Klaber named Portfolio Manager of the Parnassus Fund

$20 billion AUM2016

$25 billion AUM2017

Matthew D. Gershuny appointed Director of Research

2014

Benjamin E. Allen named CEO

Billy J. Hwan named Portfolio Manager of the Endeavor Fund

Iyassu T. Essayas named Director of ESG Research

2018Parnassus Fund shifts to mid cap growth strategy and is renamed Parnassus Mid Cap Growth Fund

Minh T. Bui named Portfolio Manager of the Parnassus Fixed Income Fund

2020

“I started Parnassus Investments in the basement of my

house in 1984 to build wealth responsibly for investors,

and it has grown far more than I ever expected.”

– Parnassus Founder and Chairman Jerome Dodson

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Our Values

Principled

We hold ourselves to high ethical

standards and our actions are

guided by integrity and respect.

These principles foster a culture

of trust and guide our responsible

investment approach.

Always Learning

We work to continuously improve

our skills, processes and delivery.

We seek productive feedback from

teammates, investors and business

partners. By doing so, we operate

efficiently and create more value

for our investors.

Shared Success

We succeed when we help

our investors achieve their

long-term goals.

Collaborative

We value teamwork over

individual achievement and

empower our employees.

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Our Investors Our products appeal to investors who seek long-term core strategies that anchor their

portfolios. All of our shareholders value a well-known, high-quality boutique manager

that takes a clearly defined active approach to investing. Many appreciate the additional

information that ESG analysis provides to fundamental stock picking, while some are

primarily interested in either fundamental company analysis or social outcomes.

We make our products as widely available as possible. Some investors work directly

with us, through our website or their self-managed brokerage accounts. Other

investors work with their financial advisors to access the Parnassus strategies. We also

serve institutional investors and consultants by offering both institutional mutual funds

and separately managed accounts.

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Parnassus Investments believes that high-quality companies with solid fundamentals

offer compelling long-term investment opportunities. Our investment team defines

high-quality companies as businesses that have increasingly relevant products

or services, sustainable competitive advantages, quality management teams and

positive ESG profiles. We believe that incorporating ESG research into the decision-

making process improves both investment and social outcomes. In our view,

accurately determining an attractive purchase price is dependent on a thorough

assessment of quality.

Our Investment Philosophy

“Parnassus is a research-driven firm with a deeply

collaborative culture. When we invest, we invest big

and hold companies for a long time. Every potential

holding is scrutinized by the full team, which has

decades of experience working together to implement

the firm’s high-conviction investment process.”

– CEO Benjamin Allen

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Our Approach Principles and Performance®

Fundamental and ESG viewpoints

Our investment professionals fully integrate fundamental financial and ESG research to

assess business quality.

Collaborative research

Our entire research team closely collaborates to develop a thorough understanding of

each company’s potential range of outcomes.

High conviction We develop a high level of confidence before we buy, because we invest with

conviction for the long term.

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Our Investment Process

Moat Companies with wide moats have

sustainable operations, and can

defend their businesses against

competitors and ward off the threat

of new entrants to the industry.

ESG Companies with positive ESG

profiles have good governance,

environmental practices, workplaces

and relationships with their

communities and customers.

Valuation Once a potential investment has been identified, the team determines a

probability-weighted range of valuation outcomes. This guides the portfolio

managers’ decision about when to buy.

Management Properly incentivized management

teams with long-term focus who

own meaningful amounts of the

company stock are likely to focus

on the long-term health of the

company.

Relevancy Companies with increasing

relevancy offer products or services

that are gaining share in the overall

economy and maintain workplaces

that have high levels of retention

and engagement.

We invest in companies with positive moats, management, relevancy and ESG profiles.

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“Whereas much of Wall Street just looks at the tip of the

iceberg, we look below the water line to deeply understand

each company’s products, management team and history

and determine what makes them special.”

– CIO Todd Ahlsten

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ESG IntegrationOur team’s comprehensive ESG analysis uncovers hidden risks and opportunities that

may be overlooked by other investors.

We believe every investor can gain an advantage with investments that are selected

after considering the company’s environmental record, researching the state of its social

relationships and monitoring the health of its governance. Using all these ESG lenses as

part of a comprehensive security selection process that also includes thorough analysis

of traditional financials can result in a more complete understanding of each potential

holding. And this approach can benefit all investors—whether their starting point is ESG

principles or financial performance.

Exclusionary ScreensThe ESG team’s analysis begins by excluding companies from consideration if

they derive significant revenue from alcohol, tobacco, weapons, gambling, nuclear

power or fossil fuels.

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Environment Energy and water usage

Product life cycle

Carbon footprint

Waste stream

Governance

Leadership structures

Compensation

Management turnover

Business ethics

Community Relations with stakeholders

Impact on the community

Philanthropy

Customers

Product safety

Recalls

Privacy

Workplace Diversity and inclusion

Employee benefits

Safety

Engagement

ESG FactorsThe ESG analysts undertake comprehensive research on those companies that pass the

exclusionary screens, focusing on multiple issues that are grouped into five broad factors.

The key indicators within each category are disclosure, policies, performance

and industry-specific factors.

Company EngagementParnassus owns large quantities of company stock, which opens up opportunities for

our investors to make their voices heard by some of the most powerful companies in

the world. In our experience, building positive relationships with management—which is

more likely to happen when they know we are significant stockholders—is an impactful

way to effect meaningful corporate change. When companies see we are offering

constructive suggestions, they may also approach us for advice.

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The five Parnassus Funds® are actively managed mutual funds. The funds employ a

singular investment process that fully integrates fundamental and ESG analysis to

identify high-quality companies with attractive valuations. With options that aim to

smooth your client experience across market cycles or provide a higher risk/return

profile, all the Parnassus Funds feature extensive track records and oversight by

seasoned portfolio managers.

Our Funds

Todd C. Ahlsten, Chief Investment Officer and Lead Portfolio Manager (since 2001)

Benjamin E. Allen, Chief Executive Officer

Parnassus Core Equity Fund Holds high-quality companies as it seeks both lower downside capture during market declines and a large portion of market gains.

Tickers Asset Class Benchmark Holdings Inception

PRBLX / PRILX U.S. large cap S&P 500 Index ~40 8/31/1992

Jerome L. Dodson, Lead Portfolio Manager (since 2005)

Billy J. Hwan, CFA, CPA, Portfolio Manager (since 2018)

Parnassus Endeavor Fund A positive workplace fund that holds deeply discounted out-of-favor stocks that the team believes are likely to bounce back.


PARWX / PFPWX U.S. large cap S&P 500 Index ~30 4/29/2005

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Ian Sexsmith, CFA, Portfolio Manager (since 2013)

Robert J. Klaber, Portfolio Manager (since 2016)

Parnassus Mid Cap Growth Fund The Parnassus Mid Cap Growth Fund invests in U.S. mid cap growth companies. The portfolio managers focus on high-quality, relevant businesses that they believe have ample runways for continued growth.


PARNX / PFPRX U.S. mid cap growth

Russell Midcap

Growth Index~40 8/31/1992

Matthew D. Gershuny, Lead Portfolio Manager (since 2008)

Lori A. Keith, Portfolio Manager (since 2008)

Parnassus Mid Cap Fund Holds high-quality companies as it seeks both lower downside capture during market declines and a large portion of market gains.


PARMX / PFPMX U.S. mid capRussell Midcap

Index~40 4/29/2005

Samantha D. Palm, Lead Portfolio Manager (since 2013)

Minh T. Bui, Portfolio Manager (since 2020)

Parnassus Fixed Income Fund A U.S. intermediate investment grade fund that leverages the Parnassus team’s expertise in fundamental and ESG research to select individual debt securities.


PRFIX / PFPLXU.S. investment grade fixed income

Bloomberg Barclays U.S. Aggregate Bond Index

~95 8/31/1992

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Our Investment Team

Jerome L. Dodson

Chairman Lead Portfolio Manager Parnassus Endeavor Fund

Benjamin E. Allen

Chief Executive Officer Portfolio Manager Parnassus Core Equity Fund

Matthew D. Gershuny

Director of Research Lead Portfolio Manager Parnassus Mid Cap Fund

Lori A. Keith

Portfolio Manager Parnassus Mid Cap Fund

Ian Sexsmith, CFA

Portfolio Manager Parnassus Mid Cap Growth Fund

Minh T. Bui Portfolio Manager Parnassus Fixed Income Fund

Robert J. Klaber

Portfolio Manager Parnassus Mid Cap Growth Fund

Samantha D. Palm

Lead Portfolio Manager Parnassus Fixed Income Fund

Billy J. Hwan, CFA, CPA

Portfolio Manager, Parnassus Endeavor Fund

Todd C. Ahlsten

Chief Investment Officer Lead Portfolio Manager Parnassus Core Equity Fund

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We look forward to working with you.

Our ESG Team

Iyassu Essayas

Director of ESG Research

Rachel Nishimoto

Senior Research Analyst

Marissa LaFave

Research Analyst

Visit www.parnassus.com to learn more about the Parnassus Funds.

Read our thought leadership.

Subscribe for updates.

Follow us on social media.

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Effective May 1, 2020, the name of the Parnassus Fund changed to the Parnassus Mid Cap Growth Fund. The Fund’s principal investment strategy changed from a multi-cap fund to a fund that primarily invests in mid-sized growth companies.

The Standard & Poor’s 500 Composite Stock Price Index (also known as the S&P 500) and the Russell MidCap Index are unmanaged indexes of common stocks and it is not possible to invest directly in an index. Index figures do not take any expenses, fees or taxes into account, but mutual fund returns do. The S&P 500 Index is a product of S&P Dow Jones Indices LLC and/or its affiliates and has been licensed for use by Parnassus Investments. Copyright © 2019 by S&P Dow Jones Indices LLC, a subsidiary of McGraw–Hill Financial, Inc., and/or its affiliates. All rights reserved. Redistribution, reproduction and/or photocopying in whole or in part are prohibited without written permission of S&P Dow Jones Indices LLC. For more information on any of S&P Dow Jones Indices LLC’s indices please visit www.spdji.com. S&P® is a registered trademark of Standard & Poor’s Financial Services LLC and Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC. Neither S&P Dow Jones Indices LLC, Dow Jones Trademark Holdings LLC, their affiliates nor their third party licensors make any representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and neither S&P Dow Jones Indices LLC, Dow Jones Trademark Holdings LLC, their affiliates nor their third party licensors shall have any liability for any errors, omissions, or interruptions of any index or the data included therein. Parnassus Investments is not affiliated with MSCI, Inc., Standards and Poor’s, Inc, or Russell, Inc.

Risks: The Funds share price may change daily based on the value of its security holdings. Stock markets can be volatile, and stock values fluctuate in response to the asset levels of individual companies and in response to general U.S. and international market and economic conditions. In addition to large-cap companies, the Funds may invest in small- and/or mid-cap companies, which are generally riskier than larger companies, and the Fund’s share price may be more volatile than funds that invest in larger companies. Security holdings in the funds can vary significantly from broad market indexes. Bond fund values fluctuate in response to the financial conditions of individual issuers, general market and economic conditions, and changes in interest rates. In general, when interest rates rise, bond fund values fall, and investors may lose principal value. Security holdings in the fund can vary significantly from broad market indexes. Copyright® 2019 Parnassus Investments. All rights reserved. Mutual fund investing involves risk and loss of principal is possible. 20200424-0290 The Parnassus Funds are underwritten and distributed by Parnassus Funds Distributor, LLC.

There are no assurances the Parnassus Funds investment objectives will be achieved, and no guarantees the socially responsible investment strategies discussed will be successful.

Before investing, an investor should carefully consider the investment objectives, risks, charges and expenses of the fund and should carefully read the prospectus or summary prospectus, which contains this information. A prospectus or summary prospectus can be obtained on the website, www.parnassus.com, or by calling (800) 999–3505.

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