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Fidelity® Total Bond ETF FBND Sustainability

| Analyst rating as of

Sustainability Analysis

Sustainable Summary

Sustainability Summary is not assigned to this investment.

Morningstar generates quantitatively driven content that covers the Environmental, Social, and Governance (ESG) characteristics for managed investments that have both a Morningstar Sustainability Rating and a Carbon Risk Score, called the Sustainability Strategy Summary. This share class’ Sustainability Summary content was not generated because of insufficient data. To generate individualized content, the Sustainability Summary requires sufficient data to create its framework of “mental models” designed to mimic content written by analysts. The Sustainability Strategy Summary uses an algorithm designed to predict the ESG analysis that analysts would produce on the investment product if they covered it.

ESG Commitment Level Asset Manager

| Low

In recent years, Fidelity Investments has contributed heavily to its investment teams’ ability to scrutinize companies’ environmental, social, and governance issues and to offer new products surrounding that research. Its business leaders consider its advancements in this arena to be a strategic priority, and its investment leaders have thoughtfully developed frameworks to inform portfolio managers’ and analysts’ thinking on sustainability issues. But the firm receives an ESG Commitment Level of Low because it has provided little public clarity about its expectations of current or prospective portfolio companies with respect to their ESG priorities and it has not shared ESG metrics on its portfolios with investors. Fidelity formalized its ESG research efforts in 2017, when it signed the UN-supported Principles for Responsible Investment and created a centralized team of sustainability specialists. The firm has significantly bolstered that team since 2019 by recruiting a sizable cohort of analysts (including some with ample sustainable-investing experience) and new leaders to help shepherd their research. By late 2021, it had 10 analysts with sector-specific coverage and ESG heads in charge of specific asset classes, including equity and fixed income. Leveraging sustainability data from third-party vendors and Fidelity’s direct discussions with the executives of its portfolio companies, the ESG analysts collaborate with Fidelity’s sprawling teams of fundamental research analysts to assign proprietary ESG ratings to a large portion of the firm’s investable universe. It is a sophisticated framework and scalable: Fidelity has recently expanded it to encompass noncorporate fixed-income instruments, such as asset-backed securities and municipal bonds, whose greater complexity and scarcer ESG data make them tougher for asset managers to assess through a sustainability lens. Deep quantitative resources help make it feasible for Fidelity. But it is hard for investors to know for sure how the firm’s ESG resources impact its funds or the thinking of its portfolio managers. Fidelity provides no data that might describe its strategies’ ESG profiles, while some peers offer absolute ESG metrics along with peer-relative comparisons. Few of its strategies use well-defined criteria to bar ESG laggards, and those that do have in place basic, timid exclusions. It provides only vague guidelines for how it will vote proxies on key ESG resolutions, and its voting record does not show much support for them. Its inaugural stewardship report, released in 2021, marked a significant step toward revealing more about its ESG philosophy and processes, but it holds back details surrounding its engagement with corporate executives. With greater illumination of how it urges for specific sustainability outcomes, it could show greater commitment to ESG.