UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-02958
| T. Rowe Price International Funds, Inc. |
| (Exact name of registrant as specified in charter) |
| 100 East Pratt Street, Baltimore, MD 21202 |
| (Address of principal executive offices) |
| David Oestreicher |
| 100 East Pratt Street, Baltimore, MD 21202 |
| (Name and address of agent for service) |
Registrant’s telephone number, including area code: (410) 345-2000
Date of fiscal year end: October 31
Date of reporting period: October 31, 2021
 |
| Global Impact Equity Fund | October 31, 2021 |
| TGPEX | Investor Class |
| TGBLX | I Class |
| T. ROWE PRICE GLOBAL IMPACT EQUITY FUND |
HIGHLIGHTS
| ■ | The fund generated a strong return and outperformed its MSCI benchmark in the period from its inception on March 15, 2021, to October 31, 2021. |
| ■ | Our choice of securities and overweights in health care and information technology (IT) contributed the most to relative performance. Conversely, stock picks in consumer discretionary were unfavorable, although our underweight exposure helped offset these losses to a degree. Our above-benchmark allocation and security selection in industrials and business services also dragged on relative returns. |
| ■ | As of the end of October, we have around 43.6% of the portfolio in our Climate and Resource Impact pillar. Within this, the sub-pillar with the largest allocation is Reducing Greenhouse Gases. Approximately 50.0% of the portfolio is aligned to our Social Equity and Quality of Life pillar, with Improving Health being the sub-pillar with the largest allocation. About 5.8% of the portfolio is invested in our third pillar, Sustainable Innovation and Productivity. |
| ■ | While we are monitoring closely the factors that could exert upward pressure on wages, we anticipate that inflation will continue to hover around current levels. An environment of stable inflation and reasonable valuations would likely lend support to companies with good durability of earnings: the types of companies that our investment process seeks to identify. |
Log in to your account at troweprice.com for more information.
*Certain mutual fund accounts that are assessed an annual account service fee can also save money by switching to e-delivery.
CIO Market Commentary
Dear Shareholder
Global stock markets produced strong returns during your fund’s fiscal year, the 12-month period ended October 31, 2021. The rollout of coronavirus vaccines helped drive extraordinary gains in the first half of the reporting period, and while the equity rally slowed in recent months, some benchmarks continued to grind out new record highs as the period came to an end.
In the U.S., the S&P 500 Index was up 43% (including dividends) for the 12-month period, and most developed market benchmarks advanced more than 30%. Emerging markets produced solid results for the full year but faced increased volatility in the second half of the period. According to MSCI, value stocks narrowly outperformed their growth counterparts over the 12 months. At the sector level, energy stocks delivered very strong returns as oil prices reached multiyear highs, and banks also performed well, supported by higher longer-term interest rates and improved lending margins.
Fixed income markets faced headwinds as Treasury yields rose rapidly in the first quarter of 2021 from the historically low levels seen last year, although high yield bonds performed well. Meanwhile, the U.S. dollar was mixed against foreign currencies over the full year.
Strong corporate earnings growth supported stocks and corporate bonds throughout the period, but investors faced new worries as the period progressed. The spread of the delta variant of the coronavirus dashed hopes that vaccines would bring about a quick end to the pandemic, and economic growth, while still positive, began to slow. U.S. gross domestic product decelerated from a 6.7% annual pace in the second quarter to 2.0% in the third quarter (according to the initial estimate) amid weaker consumer spending. Some Purchasing Managers’ Indexes showed evidence of slowing economic activity globally.
Investors also worried about how developments in China would impact the global economy. The Chinese government announced more stringent business regulations during the period, particularly on the technology sector, and the precarious debt load of a large property developer added to market concerns.
Meanwhile, inflation surged as the release of pent-up demand and supply chain disruptions contributed to higher prices around the globe. Inflation measures in the U.S., UK, and eurozone all reached their highest levels in more than a decade and far exceeded central bank targets, although most policymakers argued that elevated inflation was a transitory phenomenon caused by the reopening of economies.
The fiscal and monetary stimulus that global governments and central banks enacted in response to the pandemic continued to be supportive for markets but appears to have peaked. Just after our reporting period ended, the Federal Reserve announced it would begin trimming its purchases of Treasury bonds and mortgage-backed securities in November and would likely wrap up its asset purchases by next summer. The Fed’s latest projections indicated that a rate hike isn’t likely until the second half of next year at the earliest, but other central banks have begun telegraphing that rate hikes could come soon.
How markets respond to the normalization of monetary policy is an open question. While fading stimulus might pose some challenges for investors, I believe it could contribute to a return of price sensitivity in global markets, which bodes well for selective investors focused on fundamentals.
While I do not expect robust overall equity returns in the near term given the market’s elevated valuations, I am mindful that investors have not yet enjoyed all the potential fruits of the recovery. Many companies have yet to see business return to pre-pandemic levels, and identifying which ones are either regaining their footing or disrupting markets through innovation will be key. I’m confident our portfolio managers and global research organization will serve our investors well in this environment.
Thank you for your continued confidence in T. Rowe Price.
Sincerely,
Robert Sharps
Group Chief Investment Officer
Management’s Discussion of Fund Performance
INVESTMENT OBJECTIVE
The fund seeks long-term growth of capital.
FUND COMMENTARY
How did the fund perform since inception?
The Global Impact Equity Fund returned 15.70% in the period since its inception on March 15, 2021, to October 31, 2021. The fund outperformed the MSCI All Country World Index Net. (Returns for the I Class shares varied slightly, reflecting a different fee structure. Past performance cannot guarantee future results.)
What factors influenced the fund’s performance?
Stock selection and our overweight in health care boosted relative returns the most. Shares of Danaher, a provider of health care solutions and water purification products, were strong. The company’s better-than-expected results were attributable to strength in its life sciences and diagnostics segments on COVID-19 tailwinds. Intuitive Surgical was another top contributor. The company provides health care solutions and medical equipment, specifically leading edge robotic surgical systems. Its shares were buoyed by an acceleration in procedure growth. (Please refer to the portfolio of investments for a complete list of holdings and the amount each represents in the portfolio.)
Our security choices and above-benchmark allocation to IT contributed positively. U.S.-based software company Atlassian, which provides a task-sharing platform that meaningfully reduces the need for teams to meet in person and improves remote collaboration, released a solid set of results, with accelerating subscription revenue growth driven by strength in both its cloud and datacenter segments. Another top contributor to relative returns was Intuit, a provider of application software that promotes financial inclusion with products oriented toward personal finance solutions and supporting small and medium-sized enterprises (SMEs). Sentiment toward Intuit has been boosted by the company’s acquisition of Mailchimp, a global customer engagement and marketing platform for SMEs.
In contrast, stock picks in consumer discretionary were unfavorable, although losses here were to a degree offset by our underweight exposure. TAL Education, a China-based provider of K–12 after-school tutoring services that helps extend the reach of education to many of the underprivileged, was a laggard. Its shares slumped after the Chinese government announced its new after-school tutoring policy, which effectively undermines the sector’s commercial business model. We have eliminated the stock. Online pharmacy Shop Apotheke Europe, which improves access to health care (e-prescriptions) and reduces the cost of delivery of health care to large populations in Europe, also detracted. The company’s shares were weak due to logistics issues and concerns that an e-prescription law, which is planned to come into force in Germany in January 2022, might be delayed.
Our overweight allocation and security selection in industrials and business services held back gains. Array Technologies, a pureplay technology business focused on solar generation and a provider of equipment aimed at solar efficiency maximization, hurt relative returns. The firm announced that it was unable to affirm guidance for the 2021 fiscal year, due to rapidly increasing steel and freight prices. This led us to reexamine the original investment thesis, and we eliminated the position on concerns about the durability of the company’s business model. Trane Technologies also detracted. The industrial equipment provider, which leverages data and digital connections to continually improve the sustainability of its products, is facing near-term margin pressures due to raw material inflation and supply chain constraints.
How is the fund positioned?
Our investment approach aligns with the United Nations Sustainable Development Goals by evaluating impact across three pillars and eight sub-pillars that encompass: (1) Climate and Resource Impact, (2) Social Equity and Quality of Life, and (3) Sustainable Innovation and Productivity.
At the end of October 2021, approximately 50.0% of the portfolio was aligned to our Social Equity and Quality of Life pillar. Within this pillar, we have three sub-pillars, the first being Enabling Social Equity. Here we are focused on companies that can enable access to education, consumption at the bottom of the pyramid, and financial inclusion—within both emerging and developed markets. Examples include microfinance banks in emerging markets, such as India-based HDFC Bank, and challenger financial service providers that are improving financial inclusion among developed market consumers. The second sub-pillar is Enhancing Quality of Life. Companies here include those helping to improve mental and physical fitness, as well as personal security and cybersecurity. The third sub-pillar is Improving Health. Here, we look for companies within the health care ecosystem that improve the pace of innovation, reduce costs, or meaningfully change patient outcomes. We continue to feel positive about companies exposed to the acceleration of pandemic health response efforts, as well as the need to provide catch-up procedures that were postponed during lockdowns in many countries.
We have around 43.6% of the portfolio in our Climate and Resource Impact pillar. Within this, the sub-pillar with the largest allocation is Reducing Greenhouse Gases. Companies falling within this pillar include pureplay solar companies, as well as providers of alternative energy technologies—such as NextEra Energy, which is one of the largest investors in renewables globally—which will be key enablers for an environment of net-zero greenhouse gas emissions. We also invest in leaders in cloud technology and companies offering communication and collaboration software, which reduces the need to travel. Other sub-pillars are Nurturing Circular Economies and Promoting Healthy Ecosystems.
About 5.8% of the portfolio is invested in our third pillar, Sustainable Innovation and Productivity. These can be companies that provide technological solutions to solve social and environmental issues, such as semiconductor companies that improve access to digital products (we have a sizable position in ASML Holding, which is a major supplier to the semiconductor industry) and companies engaged in the construction of smart cities or other innovative infrastructure development.
What is portfolio management’s outlook?
Several important environmental and social policy developments over the period reinforced our view on some trends that are here to stay: the Global Methane Pledge at the COP26 summit, as well as the Biden administration’s infrastructure proposal and planned spending increases and tax cuts aimed at expanding access to education and child care. It is worth noting that similar initiatives to bring about greater equality of opportunity are being advanced globally; these are likely to shape our investment decision-making in quarters to come. Within the portfolio, we will look to have exposure to companies that stand to benefit in the longer term from these favorable environmental and social developments.
Worries about inflation have been stoked by global supply chain constraints, notably bottlenecks in semiconductor supply, in the face of rebounding industrial activity. We believe that these shortages are transient and slowly abating, as suppliers ramp up production to meet demand; we have already seen this in the case of agricultural commodities such as corn and soy. While we are monitoring closely the factors that could exert upward pressure on wages, we anticipate that inflation will continue to hover around current levels. An environment of stable inflation and reasonable valuations would likely lend support to companies with good durability of earnings: the types of companies that our investment process seeks to identify.
The global economy has made vast progress toward post-coronavirus reopening, and we believe these developments have largely been priced in by markets. Progress in containing COVID-19 has been uneven across the global economy, however, with vaccination rates in emerging market countries lagging developed market peers. As this performance gap closes, which we expect it to, there is the potential for emerging market companies to benefit as their economies get closer to a full reopening.
The views expressed reflect the opinions of T. Rowe Price as of the date of this report and are subject to change based on changes in market, economic, or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.
RISKS OF INVESTING IN THE FUND
The fund may not succeed in generating a positive environmental and/or social impact. The fund’s incorporation of environmental and/or social impact criteria into its investment process may cause the fund to perform differently from a fund that uses a different methodology to identify and/or incorporate environmental and/or social impact criteria or relies solely or primarily on financial metrics. In addition, it may cause it to forgo opportunities to buy certain securities that otherwise might be advantageous or to sell securities when it might otherwise be advantageous to continue to hold these securities. The definition of “impact investing” will vary according to an investor’s beliefs and values. There is no guarantee that T. Rowe Price’s definition of impact investing, security selection criteria, or investment judgment will reflect the beliefs or values of any particular investor.
Stocks generally fluctuate in value more than bonds and may decline significantly over short time periods. There is a chance that stock prices overall will decline because stock markets tend to move in cycles, with periods of rising and falling prices. The value of stocks held by the fund may decline due to general weakness or volatility in the stock markets in which the fund invests or because of factors that affect a particular company or industry.
Non-U.S. securities tend to be more volatile and have lower overall liquidity than investments in U.S. securities and may lose value because of adverse local, political, social, or economic developments overseas or due to changes in the exchange rates between foreign currencies and the U.S. dollar. In addition, investments outside the U.S. are subject to settlement practices and regulatory and financial reporting standards that differ from those of the U.S. The risks of investing outside the U.S. are heightened for any investments in emerging markets, which are subject to greater volatility.
These are some of the principal risks of investing in this fund. For a more thorough discussion of risks, please see the fund’s prospectus.
BENCHMARK INFORMATION
Note: MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed, or produced by MSCI.
AVERAGE ANNUAL COMPOUND TOTAL RETURN
EXPENSE RATIO
FUND EXPENSE EXAMPLE
As a mutual fund shareholder, you may incur two types of costs: (1) transaction costs, such as redemption fees or sales loads, and (2) ongoing costs, including management fees, distribution and service (12b-1) fees, and other fund expenses. The following example is intended to help you understand your ongoing costs (in dollars) of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the most recent six-month period and held for the entire period.
Please note that the fund has two share classes: The original share class (Investor Class) charges no distribution and service (12b-1) fee, and the I Class shares are also available to institutionally oriented clients and impose no 12b-1 or administrative fee payment. Each share class is presented separately in the table.
Actual Expenses
The first line of the following table (Actual) provides information about actual account values and expenses based on the fund’s actual returns. You may use the information on this line, together with your account balance, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The information on the second line of the table (Hypothetical) is based on hypothetical account values and expenses derived from the fund’s actual expense ratio and an assumed 5% per year rate of return before expenses (not the fund’s actual return). You may compare the ongoing costs of investing in the fund with other funds by contrasting this 5% hypothetical example and the 5% hypothetical examples that appear in the shareholder reports of the other funds. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period.
Note: T. Rowe Price charges an annual account service fee of $20, generally for accounts with less than $10,000. The fee is waived for any investor whose T. Rowe Price mutual fund accounts total $50,000 or more; accounts electing to receive electronic delivery of account statements, transaction confirmations, prospectuses, and shareholder reports; or accounts of an investor who is a T. Rowe Price Personal Services or Enhanced Personal Services client (enrollment in these programs generally requires T. Rowe Price assets of at least $250,000). This fee is not included in the accompanying table. If you are subject to the fee, keep it in mind when you are estimating the ongoing expenses of investing in the fund and when comparing the expenses of this fund with other funds.
You should also be aware that the expenses shown in the table highlight only your ongoing costs and do not reflect any transaction costs, such as redemption fees or sales loads. Therefore, the second line of the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. To the extent a fund charges transaction costs, however, the total cost of owning that fund is higher.
QUARTER-END RETURNS
The accompanying notes are an integral part of these financial statements.
The accompanying notes are an integral part of these financial statements.
October 31, 2021
The accompanying notes are an integral part of these financial statements.
October 31, 2021
The accompanying notes are an integral part of these financial statements.
The accompanying notes are an integral part of these financial statements.
The accompanying notes are an integral part of these financial statements.
| NOTES TO FINANCIAL STATEMENTS |
T. Rowe Price International Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940 (the 1940 Act). The Global Impact Equity Fund (the fund) is a diversified, open-end management investment company established by the corporation. The fund incepted on March 15, 2021. The fund seeks long-term growth of capital. The fund has two classes of shares: the Global Impact Equity Fund (Investor Class) and the Global Impact Equity Fund–I Class (I Class). I Class shares require a $1 million initial investment minimum, although the minimum generally is waived for retirement plans, financial intermediaries, and certain other accounts. Each class has exclusive voting rights on matters related solely to that class; separate voting rights on matters that relate to both classes; and, in all other respects, the same rights and obligations as the other class.
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
Basis of Preparation The fund is an investment company and follows accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 (ASC 946). The accompanying financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (GAAP), including, but not limited to, ASC 946. GAAP requires the use of estimates made by management. Management believes that estimates and valuations are appropriate; however, actual results may differ from those estimates, and the valuations reflected in the accompanying financial statements may differ from the value ultimately realized upon sale or maturity.
Investment Transactions, Investment Income, and Distributions Investment transactions are accounted for on the trade date basis. Income and expenses are recorded on the accrual basis. Realized gains and losses are reported on the identified cost basis. Income tax-related interest and penalties, if incurred, are recorded as income tax expense. Dividends received from mutual fund investments are reflected as dividend income; capital gain distributions are reflected as realized gain/loss. Dividend income and capital gain distributions are recorded on the ex-dividend date. Earnings on investments recognized as partnerships for federal income tax purposes reflect the tax character of such earnings. Distributions from REITs are initially recorded as dividend income and, to the extent such represent a return of capital or capital gain for tax purposes, are reclassified when such information becomes available. Non-cash dividends, if any, are recorded at the fair market value of the asset received. Distributions to shareholders are recorded on the ex-dividend date. Income distributions, if any, are declared and paid by each class annually. A capital gain distribution may also be declared and paid by the fund annually.
Currency Translation Assets, including investments, and liabilities denominated in foreign currencies are translated into U.S. dollar values each day at the prevailing exchange rate, using the mean of the bid and asked prices of such currencies against U.S. dollars as provided by an outside pricing service. Purchases and sales of securities, income, and expenses are translated into U.S. dollars at the prevailing exchange rate on the respective date of such transaction. The effect of changes in foreign currency exchange rates on realized and unrealized security gains and losses is not bifurcated from the portion attributable to changes in market prices.
Class Accounting Shareholder servicing, prospectus, and shareholder report expenses incurred by each class are charged directly to the class to which they relate. Expenses common to all classes, investment income, and realized and unrealized gains and losses are allocated to the classes based upon the relative daily net assets of each class.
Capital Transactions Each investor’s interest in the net assets of the fund is represented by fund shares. The fund’s net asset value (NAV) per share is computed at the close of the New York Stock Exchange (NYSE), normally 4 p.m. ET, each day the NYSE is open for business. However, the NAV per share may be calculated at a time other than the normal close of the NYSE if trading on the NYSE is restricted, if the NYSE closes earlier, or as may be permitted by the SEC. Purchases and redemptions of fund shares are transacted at the next-computed NAV per share, after receipt of the transaction order by T. Rowe Price Associates, Inc., or its agents.
Indemnification In the normal course of business, the fund may provide indemnification in connection with its officers and directors, service providers, and/or private company investments. The fund’s maximum exposure under these arrangements is unknown; however, the risk of material loss is currently considered to be remote.
NOTE 2 - VALUATION
Fair Value The fund’s financial instruments are valued at the close of the NYSE and are reported at fair value, which GAAP defines as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The T. Rowe Price Valuation Committee (the Valuation Committee) is an internal committee that has been delegated certain responsibilities by the fund’s Board of Directors (the Board) to ensure that financial instruments are appropriately priced at fair value in accordance with GAAP and the 1940 Act. Subject to oversight by the Board, the Valuation Committee develops and oversees pricing-related policies and procedures and approves all fair value determinations. Specifically, the Valuation Committee establishes policies and procedures used in valuing financial instruments, including those which cannot be valued in accordance with normal procedures or using pricing vendors; determines pricing techniques, sources, and persons eligible to effect fair value pricing actions; evaluates the services and performance of the pricing vendors; oversees the pricing process to ensure policies and procedures are being followed; and provides guidance on internal controls and valuation-related matters. The Valuation Committee provides periodic reporting to the Board on valuation matters.
Various valuation techniques and inputs are used to determine the fair value of financial instruments. GAAP establishes the following fair value hierarchy that categorizes the inputs used to measure fair value:
Level 1 – quoted prices (unadjusted) in active markets for identical financial instruments that the fund can access at the reporting date
Level 2 – inputs other than Level 1 quoted prices that are observable, either directly or indirectly (including, but not limited to, quoted prices for similar financial instruments in active markets, quoted prices for identical or similar financial instruments in inactive markets, interest rates and yield curves, implied volatilities, and credit spreads)
Level 3 – unobservable inputs (including the fund’s own assumptions in determining fair value)
Observable inputs are developed using market data, such as publicly available information about actual events or transactions, and reflect the assumptions that market participants would use to price the financial instrument. Unobservable inputs are those for which market data are not available and are developed using the best information available about the assumptions that market participants would use to price the financial instrument. GAAP requires valuation techniques to maximize the use of relevant observable inputs and minimize the use of unobservable inputs. When multiple inputs are used to derive fair value, the financial instrument is assigned to the level within the fair value hierarchy based on the lowest-level input that is significant to the fair value of the financial instrument. Input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level but rather the degree of judgment used in determining those values.
Valuation Techniques Equity securities, including exchange-traded funds, listed or regularly traded on a securities exchange or in the over-the-counter (OTC) market are valued at the last quoted sale price or, for certain markets, the official closing price at the time the valuations are made. OTC Bulletin Board securities are valued at the mean of the closing bid and asked prices. A security that is listed or traded on more than one exchange is valued at the quotation on the exchange determined to be the primary market for such security. Listed securities not traded on a particular day are valued at the mean of the closing bid and asked prices for domestic securities and the last quoted sale or closing price for international securities.
The last quoted prices of non-U.S. equity securities may be adjusted to reflect the fair value of such securities at the close of the NYSE, if the fund determines that developments between the close of a foreign market and the close of the NYSE will affect the value of some or all of its portfolio securities. Each business day, the fund uses information from outside pricing services to evaluate and, if appropriate, decide whether it is necessary to adjust quoted prices to reflect fair value by reviewing a variety of factors, including developments in foreign markets, the performance of U.S. securities markets, and the performance of instruments trading in U.S. markets that represent foreign securities and baskets of foreign securities. The fund uses outside pricing services to provide it with quoted prices and information to evaluate or adjust those prices. The fund cannot predict how often it will use quoted prices and how often it will determine it necessary to adjust those prices to reflect fair value.
Investments in mutual funds are valued at the mutual fund’s closing NAV per share on the day of valuation. Assets and liabilities other than financial instruments, including short-term receivables and payables, are carried at cost, or estimated realizable value, if less, which approximates fair value.
Investments for which market quotations or market-based valuations are not readily available or deemed unreliable are valued at fair value as determined in good faith by the Valuation Committee, in accordance with fair valuation policies and procedures. The objective of any fair value pricing determination is to arrive at a price that could reasonably be expected from a current sale. Financial instruments fair valued by the Valuation Committee are primarily private placements, restricted securities, warrants, rights, and other securities that are not publicly traded. Factors used in determining fair value vary by type of investment and may include market or investment specific considerations. The Valuation Committee typically will afford greatest weight to actual prices in arm’s length transactions, to the extent they represent orderly transactions between market participants, transaction information can be reliably obtained, and prices are deemed representative of fair value. However, the Valuation Committee may also consider other valuation methods such as market-based valuation multiples; a discount or premium from market value of a similar, freely traded security of the same issuer; discounted cash flows; yield to maturity; or some combination. Fair value determinations are reviewed on a regular basis and updated as information becomes available, including actual purchase and sale transactions of the investment. Because any fair value determination involves a significant amount of judgment, there is a degree of subjectivity inherent in such pricing decisions, and fair value prices determined by the Valuation Committee could differ from those of other market participants.
Valuation Inputs The following table summarizes the fund’s financial instruments, based on the inputs used to determine their fair values on October 31, 2021 (for further detail by category, please refer to the accompanying Portfolio of Investments):
NOTE 3 - OTHER INVESTMENT TRANSACTIONS
Consistent with its investment objective, the fund engages in the following practices to manage exposure to certain risks and/or to enhance performance. The investment objective, policies, program, and risk factors of the fund are described more fully in the fund’s prospectus and Statement of Additional Information.
Emerging and Frontier Markets The fund invests, either directly or through investments in other T. Rowe Price funds, in securities of companies located in, issued by governments of, or denominated in or linked to the currencies of emerging and frontier market countries. Emerging markets, and to a greater extent frontier markets, generally have economic structures that are less diverse and mature, and political systems that are less stable, than developed countries. These markets may be subject to greater political, economic, and social uncertainty and differing regulatory environments that may potentially impact the fund’s ability to buy or sell certain securities or repatriate proceeds to U.S. dollars. Such securities are often subject to greater price volatility, less liquidity, and higher rates of inflation than U.S. securities. Investing in frontier markets is significantly riskier than investing in other countries, including emerging markets.
Other Purchases and sales of portfolio securities other than short-term securities aggregated $22,628,000 and $4,490,000, respectively, for the period ended October 31, 2021.
NOTE 4 - FEDERAL INCOME TAXES
Generally, no provision for federal income taxes is required since the fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code and distribute to shareholders all of its taxable income and gains. Distributions determined in accordance with federal income tax regulations may differ in amount or character from net investment income and realized gains for financial reporting purposes.
The fund files U.S. federal, state, and local tax returns as required. The fund’s tax returns are subject to examination by the relevant tax authorities until expiration of the applicable statute of limitations, which is generally three years after the filing of the tax return but which can be extended to six years in certain circumstances.
Financial reporting records are adjusted for permanent book/tax differences to reflect tax character but are not adjusted for temporary differences. The permanent book/tax adjustments have no impact on results of operations or net assets and relate primarily to a tax practice that treats a portion of the proceeds from each redemption of capital shares as a distribution of taxable net investment income or realized capital gain and nondeductible organizational expenses and the offset of the current net operating loss against realized gains. For the period ended October 31, 2021, the following reclassification was recorded:
There were no distributions in the period ended October 31, 2021. At October 31, 2021, the tax-basis cost of investments and components of net assets were as follows:
The difference between book-basis and tax-basis net unrealized appreciation (depreciation) is attributable to the deferral of losses from wash sales for tax purposes.
NOTE 5 - FOREIGN TAXES
The fund is subject to foreign income taxes imposed by certain countries in which it invests. Additionally, capital gains realized upon disposition of securities issued in or by certain foreign countries are subject to capital gains tax imposed by those countries. All taxes are computed in accordance with the applicable foreign tax law, and, to the extent permitted, capital losses are used to offset capital gains. Taxes attributable to income are accrued by the fund as a reduction of income. Current and deferred tax expense attributable to capital gains is reflected as a component of realized or change in unrealized gain/loss on securities in the accompanying financial statements. To the extent that the fund has country specific capital loss carryforwards, such carryforwards are applied against net unrealized gains when determining the deferred tax liability. Any deferred tax liability incurred by the fund is included in either Other liabilities or Deferred tax liability on the accompanying Statement of Assets and Liabilities.
NOTE 6 - RELATED PARTY TRANSACTIONS
The fund is managed by T. Rowe Price Associates, Inc. (Price Associates), a wholly owned subsidiary of T. Rowe Price Group, Inc. (Price Group). Price Associates has entered into a sub-advisory agreement(s) with one or more of its wholly owned subsidiaries, to provide investment advisory services to the fund. The investment management agreement between the fund and Price Associates provides for an annual investment management fee, which is computed daily and paid monthly. The fee consists of an individual fund fee, equal to 0.40% of the fund’s average daily net assets, and a group fee. The group fee rate is calculated based on the combined net assets of certain mutual funds sponsored by Price Associates (the group) applied to a graduated fee schedule, with rates ranging from 0.48% for the first $1 billion of assets to 0.260% for assets in excess of $845 billion. The fund’s group fee is determined by applying the group fee rate to the fund’s average daily net assets. The fee is computed daily and paid monthly. At October 31, 2021, the effective annual group fee rate was 0.28%.
The Investor Class is subject to a contractual expense limitation through the expense limitation date indicated in the table below. During the limitation period, Price Associates is required to waive its management fee or pay any expenses (excluding interest; expenses related to borrowings, taxes, and brokerage; and other non-recurring expenses permitted by the investment management agreement) that would otherwise cause the class’s ratio of annualized total expenses to average net assets (net expense ratio) to exceed its expense limitation. The class is required to repay Price Associates for expenses previously waived/paid to the extent the class’s net assets grow or expenses decline sufficiently to allow repayment without causing the class’s net expense ratio (after the repayment is taken into account) to exceed the lesser of: (1) the expense limitation in place at the time such amounts were waived; or (2) the class’s current expense limitation. However, no repayment will be made more than three years after the date of a payment or waiver.
The I Class is also subject to an operating expense limitation (I Class Limit) pursuant to which Price Associates is contractually required to pay all operating expenses of the I Class, excluding management fees; interest; expenses related to borrowings, taxes, and brokerage; and other non-recurring expenses permitted by the investment management agreement, to the extent such operating expenses, on an annualized basis, exceed the I Class Limit. This agreement will continue through the expense limitation date indicated in the table below, and may be renewed, revised, or revoked only with approval of the fund’s Board. The I Class is required to repay Price Associates for expenses previously paid to the extent the class’s net assets grow or expenses decline sufficiently to allow repayment without causing the class’s operating expenses (after the repayment is taken into account) to exceed the lesser of: (1) the I Class Limit in place at the time such amounts were paid; or (2) the current I Class Limit. However, no repayment will be made more than three years after the date of a payment or waiver.
Pursuant to these agreements, expenses were waived/paid by and/or repaid to Price Associates during the period ended October 31, 2021 as indicated in the table below and remain subject to repayment by the fund. Any repayment of expenses previously waived/ paid by Price Associates during the period would be included in the net investment income and expense ratios presented on the accompanying Financial Highlights.
In addition, the fund has entered into service agreements with Price Associates and a wholly owned subsidiary of Price Associates, each an affiliate of the fund (collectively, Price). Price Associates provides certain accounting and administrative services to the fund. T. Rowe Price Services, Inc. provides shareholder and administrative services in its capacity as the fund’s transfer and dividend-disbursing agent. For the period ended October 31, 2021, expenses incurred pursuant to these service agreements were $46,000 for Price Associates and $6,000 for T. Rowe Price Services, Inc. All amounts due to and due from Price, exclusive of investment management fees payable, are presented net on the accompanying Statement of Assets and Liabilities.
Additionally, the fund is one of several mutual funds in which certain college savings plans managed by Price Associates have invested. As approved by the fund’s Board of Directors, shareholder servicing costs associated with each college savings plan are borne by the fund in proportion to the average daily value of its shares owned by the college savings plan. For the period ended October 31, 2021, the fund was charged less than $1,000 for shareholder servicing costs related to the college savings plans, of which less than $1,000 was for services provided by Price. All amounts due to and due from Price, exclusive of investment management fees payable, are presented net on the accompanying Statement of Assets and Liabilities. At October 31, 2021, approximately 65% of the outstanding shares of the I Class were held by college savings plans.
The fund may invest its cash reserves in certain open-end management investment companies managed by Price Associates and considered affiliates of the fund: the T. Rowe Price Government Reserve Fund or the T. Rowe Price Treasury Reserve Fund, organized as money market funds, or the T. Rowe Price Short-Term Fund, a short-term bond fund (collectively, the Price Reserve Funds). The Price Reserve Funds are offered as short-term investment options to mutual funds, trusts, and other accounts managed by Price Associates or its affiliates and are not available for direct purchase by members of the public. Cash collateral from securities lending, if any, is invested in the T. Rowe Price Short-Term Fund. The Price Reserve Funds pay no investment management fees.
As of October 31, 2021, T. Rowe Price Group, Inc., or its wholly owned subsidiaries, owned 675,000 shares of the Investor Class, representing 41% of the Investor Class's net assets and 25,000 shares of the I Class, representing 23% of the I Class’s net assets.
The fund may participate in securities purchase and sale transactions with other funds or accounts advised by Price Associates (cross trades), in accordance with procedures adopted by the fund’s Board and Securities and Exchange Commission rules, which require, among other things, that such purchase and sale cross trades be effected at the independent current market price of the security. During the period ended October 31, 2021, the fund had no purchases or sales cross trades with other funds or accounts advised by Price Associates.
Price Associates has voluntarily agreed to reimburse the fund from its own resources on a monthly basis for the cost of investment research embedded in the cost of the fund’s securities trades. This agreement may be rescinded at any time. For the period ended October 31, 2021, this reimbursement amounted to less than $1,000.
NOTE 7 - OTHER MATTERS
Unpredictable events such as environmental or natural disasters, war, terrorism, pandemics, outbreaks of infectious diseases, and similar public health threats may significantly affect the economy and the markets and issuers in which a fund invests. Certain events may cause instability across global markets, including reduced liquidity and disruptions in trading markets, while some events may affect certain geographic regions, countries, sectors, and industries more significantly than others, and exacerbate other pre-existing political, social, and economic risks. The fund’s performance could be negatively impacted if the value of a portfolio holding were harmed by such events. Since 2020, a novel strain of coronavirus (COVID-19) has resulted in disruptions to global business activity and caused significant volatility and declines in global financial markets. The duration of this outbreak or others and their effects cannot be determined with certainty.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors of T. Rowe Price International Funds, Inc. and
Shareholders of T. Rowe Price Global Impact Equity Fund
Opinion on the Financial Statements
We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of T. Rowe Price Global Impact Equity Fund (one of the funds constituting T. Rowe Price International Funds, Inc., referred to hereafter as the “Fund”) as of October 31, 2021, and the related statements of operations and changes in net assets, including the related notes, and the financial highlights for the period March 15, 2021 (Inception) through October 31, 2021 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of October 31, 2021, and the results of its operations, changes in its net assets, and the financial highlights for the period March 15, 2021 (Inception) through October 31, 2021 in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of October 31, 2021 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audit provides a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Baltimore, Maryland
December 17, 2021
We have served as the auditor of one or more investment companies in the T. Rowe Price group of investment companies since 1973.
TAX INFORMATION (UNAUDITED) FOR THE TAX YEAR ENDED 10/31/21
We are providing this information as required by the Internal Revenue Code. The amounts shown may differ from those elsewhere in this report because of differences between tax and financial reporting requirements.
The fund’s distributions to shareholders included $3,000 from short-term capital gains.
For taxable non-corporate shareholders, $60,000 of the fund's income represents qualified dividend income subject to a long-term capital gains tax rate of not greater than 20%.
For corporate shareholders, $27,000 of the fund's income qualifies for the dividends-received deduction.
INFORMATION ON PROXY VOTING POLICIES, PROCEDURES, AND RECORDS
A description of the policies and procedures used by T. Rowe Price funds to determine how to vote proxies relating to portfolio securities is available in each fund’s Statement of Additional Information. You may request this document by calling 1-800-225-5132 or by accessing the SEC’s website, sec.gov.
The description of our proxy voting policies and procedures is also available on our corporate website. To access it, please visit the following Web page:
https://www.troweprice.com/corporate/en/utility/policies.html
Scroll down to the section near the bottom of the page that says, “Proxy Voting Policies.” Click on the Proxy Voting Policies link in the shaded box.
Each fund’s most recent annual proxy voting record is available on our website and through the SEC’s website. To access it through T. Rowe Price, visit the website location shown above, and scroll down to the section near the bottom of the page that says, “Proxy Voting Records.” Click on the Proxy Voting Records link in the shaded box.
HOW TO OBTAIN QUARTERLY PORTFOLIO HOLDINGS
The fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund’s reports on Form N-PORT are available electronically on the SEC’s website (sec.gov). In addition, most T. Rowe Price funds disclose their first and third fiscal quarter-end holdings on troweprice.com.
ABOUT THE FUND’S DIRECTORS AND OFFICERS
Your fund is overseen by a Board of Directors (Board) that meets regularly to review a wide variety of matters affecting or potentially affecting the fund, including performance, investment programs, compliance matters, advisory fees and expenses, service providers, and business and regulatory affairs. The Board elects the fund’s officers, who are listed in the final table. At least 75% of the Board’s members are considered to be independent, i.e., not “interested persons” as defined in Section 2(a)(19) of the 1940 Act, of the Boards of T. Rowe Price Associates, Inc. (T. Rowe Price), and its affiliates; “interested” directors and officers are employees of T. Rowe Price. The business address of each director and officer is 100 East Pratt Street, Baltimore, Maryland 21202. The Statement of Additional Information includes additional information about the fund directors and is available without charge by calling a T. Rowe Price representative at 1-800-638-5660.
| INDEPENDENT DIRECTORS(a) | ||
| Name (Year of Birth) Year Elected [Number of T. Rowe Price Portfolios Overseen] | Principal Occupation(s) and Directorships of Public Companies and Other Investment Companies During the Past Five Years | |
| Teresa Bryce Bazemore (1959) 2018 [204] | President and Chief Executive Officer, Federal Home Loan Bank of San Francisco (2021 to present); President, Radian Guaranty (2008 to 2017); Chief Executive Officer, Bazemore Consulting LLC (2018 to 2021); Director, Chimera Investment Corporation (2017 to 2021); Director, First Industrial Realty Trust (2020 to present); Director, Federal Home Loan Bank of Pittsburgh (2017 to 2019) | |
| Ronald J. Daniels (1959) 2018 [204] | President, The Johns Hopkins University(b) and Professor, Political Science Department, The Johns Hopkins University (2009 to present); Director, Lyndhurst Holdings (2015 to present); Director, BridgeBio Pharma, Inc. (2020 to present) | |
| Bruce W. Duncan (1951) 2013 [204] | President, Chief Executive Officer, and Director, CyrusOne, Inc. (2020 to 2021); Chief Executive Officer and Director (2009 to 2016), Chair of the Board (2016 to 2020), and President (2009 to 2016), First Industrial Realty Trust, owner and operator of industrial properties; Chair of the Board (2005 to 2016) and Director (1999 to 2016), Starwood Hotels & Resorts, a hotel and leisure company; Member, Investment Company Institute Board of Governors (2017 to 2019); Member, Independent Directors Council Governing Board (2017 to 2019); Senior Advisor, KKR (2018 to present); Director, Boston Properties (2016 to present); Director, Marriott International, Inc. (2016 to 2020) | |
| Robert J. Gerrard, Jr. (1952) 2012 [204] | Advisory Board Member, Pipeline Crisis/Winning Strategies, a collaborative working to improve opportunities for young African Americans (1997 to 2016); Chair of the Board, all funds (July 2018 to present) | |
| Paul F. McBride (1956) 2013 [204] | Advisory Board Member, Vizzia Technologies (2015 to present); Board Member, Dunbar Armored (2012 to 2018) | |
| Cecilia E. Rouse, Ph.D.(c) (1963) 2013 [0] | Dean, Princeton School of Public and International Affairs (2012 to present); Professor and Researcher, Princeton University (1992 to present); Director of Education Studies Committee, MDRC, a nonprofit education and social policy research organization (2011 to 2020); Member, National Academy of Education (2010 to present); Board Member, National Bureau of Economic Research (2011 to present); Board Member of the Council on Foreign Relations (2018 to present); Board Member, The Pennington School (2017 to present); Board Member, the University of Rhode Island (2020 to present); Chair of Committee on the Status of Minority Groups in the Economic Profession of the American Economic Association (2012 to 2018); Vice President (2015 to 2016) and Board Member (2018 to present), American Economic Association | |
| John G. Schreiber (1946) 2001 [204] | Owner/President, Centaur Capital Partners, Inc., a real estate investment company (1991 to present); Cofounder, Partner, and Cochair of the Investment Committee, Blackstone Real Estate Advisors, L.P. (1992 to 2015); Director, Blackstone Mortgage Trust, a real estate finance company (2012 to 2016); Director and Chair of the Board, Brixmor Property Group, Inc. (2013 to present); Director, Hilton Worldwide (2007 to present); Director, Hudson Pacific Properties (2014 to 2016); Director, Invitation Homes (2014 to 2017); Director, JMB Realty Corporation (1980 to present) | |
| (a)All information about the independent directors was current as of December 31, 2020, unless otherwise indicated, except for the number of portfolios overseen, which is current as of the date of this report. | ||
| (b)William J. Stromberg, chair of the Board, director, and chief executive officer of T. Rowe Price Group, Inc., the parent company of the Price Funds’ investment advisor, has served on the Board of Trustees of Johns Hopkins University since 2014. | ||
| (c)Effective March 4, 2021, Dr. Rouse resigned from her role as independent director of the Price Funds. | ||
| INTERESTED DIRECTORS(a) | ||
| Name (Year of Birth) Year Elected [Number of T. Rowe Price Portfolios Overseen] | Principal Occupation(s) and Directorships of Public Companies and Other Investment Companies During the Past Five Years | |
| David Oestreicher (1967) 2018 [204] | General Counsel, Vice President, and Secretary, T. Rowe Price Group, Inc.; Chair of the Board, Chief Executive Officer, President, and Secretary, T. Rowe Price Trust Company; Director, Vice President, and Secretary, T. Rowe Price, T. Rowe Price Investment Services, Inc., T. Rowe Price Retirement Plan Services, Inc., and T. Rowe Price Services, Inc.; Director and Secretary, T. Rowe Price Investment Management, Inc.; Vice President and Secretary, T. Rowe Price International (Price International); Vice President, T. Rowe Price Hong Kong (Price Hong Kong), T. Rowe Price Japan (Price Japan), and T. Rowe Price Singapore (Price Singapore); Principal Executive Officer and Executive Vice President, all funds | |
| Robert W. Sharps, CFA, CPA (1971) 2017 [204] | Director and Vice President, T. Rowe Price; President, T. Rowe Price Group, Inc.; Director, T. Rowe Price Investment Management, Inc.; Vice President, T. Rowe Price Trust Company; Vice President, International Funds | |
| (a)All information about the interested directors was current as of December 31, 2020, unless otherwise indicated, except for the number of portfolios overseen, which is current as of the date of this report. | ||
| OFFICERS | ||
| Name (Year of Birth) Position Held With International Funds | Principal Occupation(s) | |
| Mariel Abreu (1981) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Jason R. Adams (1979) Executive Vice President | Vice President T. Rowe Price and T. Rowe Price Group, Inc. | |
| Ulle Adamson, CFA (1979) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Roy H. Adkins (1970) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Syed H. Ali (1970) Vice President | Vice President, Price Hong Kong, Price Singapore, and T. Rowe Price Group, Inc. | |
| Kennard W. Allen (1977) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Paulina Amieva (1981) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Malik S. Asif (1981) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Ziad Bakri, M.D., CFA (1980) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Harishankar Balkrishna (1983) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Sheena L. Barbosa (1983) Vice President | Vice President, Price Hong Kong and T. Rowe Price Group, Inc. | |
| Peter J. Bates, CFA (1974) Executive Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Jason A. Bauer (1979) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Luis M. Baylac (1982) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| R. Scott Berg, CFA (1972) Executive Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Steven E. Boothe, CFA (1977) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Peter I. Botoucharov (1965) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Tala Boulos (1984) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Christopher P. Brown, Jr., CFA (1977) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Andrew Chang (1983) Vice President | Vice President, Price Singapore and T. Rowe Price Group, Inc. | |
| Carolyn Hoi Che Chu (1974) Vice President | Vice President, Price Hong Kong and T. Rowe Price Group, Inc. | |
| Vincent Chung (1988) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International; formerly, Investment Analyst/Trader, Observatory Capital Management LLP (to 2019) | |
| Archibald Ciganer, CFA (1976) Executive Vice President | Director and Vice President, Price Japan; Vice President, T. Rowe Price Group, Inc. | |
| Richard N. Clattenburg, CFA (1979) Executive Vice President | Vice President, Price Singapore, T. Rowe Price, T. Rowe Price Group, Inc., Price International, and T. Rowe Price Trust Company | |
| Michael J. Conelius, CFA (1964) Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., Price International, and T. Rowe Price Trust Company | |
| Michael F. Connelly, CFA (1977) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Andrew S. Davis (1978) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Richard de los Reyes (1975) Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Michael Della Vedova (1969) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and T. Rowe Price International | |
| Iona Dent, CFA (1991) Vice President | Vice President, Price International; formerly, Associate, Equity Research, Deutsche Bank (to 2018) | |
| Maria Elena Drew (1973) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International; formerly, Executive Director, Goldman Sachs Asset Management (to 2017) | |
| Shawn T. Driscoll (1975) Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Alan S. Dupski, CPA (1982) Principal Financial Officer, Vice President, and Treasurer | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Bridget A. Ebner (1970) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| David J. Eiswert, CFA (1972) Executive Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Dawei Feng (1979) Vice President | Vice President, Price Hong Kong and T. Rowe Price Group, Inc.; formerly, Head of China Consumer in Equity Research, Credit Lyonnais Asia-Pacific (to 2018) | |
| Ryan W. Ferro (1985) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Mark S. Finn, CFA, CPA (1963) Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Quentin S. Fitzsimmons (1968) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Melissa C. Gallagher (1974) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Justin T. Gerbereux, CFA (1975) Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Aaron Gifford, CFA (1987) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc.; formerly, Strategist, Morgan Stanley & Co. LLC (to 2017) | |
| John R. Gilner (1961) Chief Compliance Officer | Chief Compliance Officer and Vice President, T. Rowe Price; Vice President, T. Rowe Price Group, Inc., and T. Rowe Price Investment Services, Inc. | |
| Vishnu V. Gopal (1979) Vice President | Vice President, Price Hong Kong and T. Rowe Price Group, Inc. | |
| Joel Grant (1978) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Gary J. Greb (1961) Vice President | Vice President, T. Rowe Price, Price International, and T. Rowe Price Trust Company | |
| Paul D. Greene II (1978) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Benjamin Griffiths, CFA (1977) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Gianluca Guicciardi (1983) Vice President | Vice President, T. Rowe Price Group, Inc., and T. Rowe Price International | |
| Shaoyu Guo (1992) Vice President | Vice President, Price Hong Kong; formerly, Economist, J.P. Morgan (to 2020); Research Analyst, International Monetary Fund (to 2017) | |
| Richard L. Hall (1979) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Nabil Hanano, CFA (1984) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Jeffrey Holford, Ph.D., ACA (1972) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc.; formerly, Managing Director, Jeffries Financial Group (to 2018) | |
| Stefan Hubrich, Ph.D., CFA (1974) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Arif Husain, CFA (1972) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Tetsuji Inoue (1971) Vice President | Vice President, Price Hong Kong, T. Rowe Price Group, Inc., and Price International | |
| Michael D. Jacobs (1971) Vice President | Vice President, Price Japan, T. Rowe Price Group, Inc., and Price International | |
| Randal S. Jenneke (1971) Vice President | Vice President, T. Rowe Price Group, Inc. | |
| Prashant G. Jeyaganesh (1983) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Nina P. Jones, CPA (1980) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Yoichiro Kai (1973) Vice President | Vice President, Price Singapore, T. Rowe Price Group, Inc., and Price International | |
| Jacob H. Kann, CFA (1987) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Jai Kapadia (1982) Vice President | Vice President, Price Hong Kong and T. Rowe Price Group, Inc. | |
| Andrew J. Keirle (1974) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Takanori Kobayashi (1981) Vice President | Vice President, Price Japan, T. Rowe Price Group, Inc., and Price International; formerly, Research Analyst, Allianz Global Investors (to 2017) | |
| Paul J. Krug, CPA (1964) Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Christopher J. Kushlis, CFA (1976) Vice President | Vice President, T. Rowe Price Group, Inc., and T. Rowe Price International | |
| Shengrong Lau (1982) Vice President | Vice President, Price Singapore and T. Rowe Price Group, Inc. | |
| Lu Liu (1979) Vice President | Vice President, Price Hong Kong and T. Rowe Price Group, Inc. | |
| Johannes Loefstrand (1988) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Anh Lu (1968) Executive Vice President | Vice President, Price Hong Kong and T. Rowe Price Group, Inc. | |
| Sebastien Mallet (1974) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Jennifer Martin (1972) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Ryan Martyn (1979) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Colin McQueen (1967) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International; formerly, Senior Investment Manager, Global Equities, Sanlam FOUR Investments UK Limited (to 2019) | |
| Raymond A. Mills, Ph.D., CFA (1960) Executive Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., Price International, and T. Rowe Price Trust Company | |
| Jihong Min (1979) Vice President | Vice President, Price Singapore and T. Rowe Price Group, Inc. | |
| Eric C. Moffett (1974) Executive Vice President | Vice President, Price Singapore and T. Rowe Price Group, Inc. | |
| Ivan Morozov, CFA (1987) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Samy B. Muaddi, CFA (1984) Executive Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Tobias F. Mueller, CFA (1980) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Razan Nasser (1985) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International; formerly, Senior Economist, HSBC Bank Middle East Ltd (to 2019) | |
| Joshua Nelson (1977) Executive Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., Price International, and T. Rowe Price Trust Company | |
| Philip A. Nestico (1976) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Sridhar Nishtala (1975) Vice President | Director and Vice President, Price Singapore; Vice President, T. Rowe Price Group, Inc. | |
| Jason Nogueira, CFA (1974) Executive Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Kenneth A. Orchard (1975) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Oluwaseun Oyegunle, CFA (1984) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Gonzalo Pángaro, CFA (1968) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Fran M. Pollack-Matz (1961) Vice President and Secretary | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., T. Rowe Price Investment Services, Inc., and T. Rowe Price Services, Inc. | |
| Shannon H. Rauser (1987) Assistant Secretary | Assistant Vice President, T. Rowe Price | |
| Todd Reese (1990) Vice President | Vice President, T. Rowe Price | |
| Melanie A. Rizzo (1982) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| David L. Rowlett, CFA (1975) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Federico Santilli, CFA (1974) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Nikolaj Schmidt (1975) Vice President | Vice President, T. Rowe Price Group, Inc., and T. Rowe Price International | |
| Sebastian Schrott (1977) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Bin Shen, CFA (1987) Vice President | Vice President, T. Rowe Price Group, Inc., and T. Rowe Price International | |
| John C.A. Sherman (1969) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Gabriel Solomon (1977) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Scott D. Solomon, CFA (1981) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Joshua K. Spencer, CFA (1973) Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| David Stanley (1963) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Saurabh Sud, CFA (1985) Executive Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc.; formerly, Senior Vice President, PIMCO (to 2018) | |
| Taymour R. Tamaddon, CFA (1976) Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Ju Yen Tan (1972) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Sin Dee Tan, CFA (1979) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Siby Thomas (1979) Executive Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Justin Thomson (1968) President | Director, Price Hong Kong; Vice President, T. Rowe Price Group, Inc.; Director and Vice President, Price International | |
| Mark J. Vaselkiv (1958) Executive Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Rupinder Vig (1979) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Willem Visser (1979) Vice President | Vice President, T. Rowe Price Group, Inc., and T. Rowe Price International; formerly, Investment Analyst, NN Investment Partners (to 2017) | |
| Chris Vost (1989) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Zenon Voyiatzis (1971) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Verena E. Wachnitz, CFA (1978) Executive Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| David J. Wallack (1960) Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company | |
| Dai Wang (1989) Vice President | Vice President, Price Hong Kong and T. Rowe Price Group, Inc. | |
| Megan Warren (1968) Vice President | Vice President, T. Rowe Price, T. Rowe Price Group, Inc., T. Rowe Price Retirement Plan Services, Inc., T. Rowe Price Services, Inc., and T. Rowe Price Trust Company; formerly, Executive Director, JPMorgan Chase (to 2017) | |
| Hiroshi Watanabe, CFA (1975) Vice President | Director and Vice President, Price Japan; Vice President, T. Rowe Price Group, Inc. | |
| J. Howard Woodward, CFA (1974) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Marta Yago (1977) Vice President | Vice President, T. Rowe Price Group, Inc., and Price International | |
| Benjamin T. Yeagle (1978) Vice President | Vice President, T. Rowe Price and T. Rowe Price Group, Inc. | |
| Ernest C. Yeung, CFA (1979) Executive Vice President | Director and Vice President, Price Hong Kong; Vice President, T. Rowe Price Group, Inc. | |
| Eric Yuan (1984) Vice President | Vice President, Price Hong Kong and T. Rowe Price Group, Inc. | |
| Wenli Zheng (1979) Executive Vice President | Vice President, Price Hong Kong and T. Rowe Price Group, Inc. | |
| Unless otherwise noted, officers have been employees of T. Rowe Price or Price International for at least 5 years. | ||
Item 1. (b) Notice pursuant to Rule 30e-3.
Not applicable.
Item 2. Code of Ethics.
The registrant has adopted a code of ethics, as defined in Item 2 of Form N-CSR, applicable to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of this code of ethics is filed as an exhibit to this Form N-CSR. No substantive amendments were approved or waivers were granted to this code of ethics during the period covered by this report.
Item 3. Audit Committee Financial Expert.
The registrant’s Board of Directors/Trustees has determined that Ms. Teresa Bryce Bazemore qualifies as an audit committee financial expert, as defined in Item 3 of Form N-CSR. Ms. Bazemore is considered independent for purposes of Item 3 of Form N-CSR.
Item 4. Principal Accountant Fees and Services.
(a) – (d) Aggregate fees billed for the last two fiscal years for professional services rendered to, or on behalf of, the registrant by the registrant’s principal accountant were as follows:
Audit fees include amounts related to the audit of the registrant’s annual financial statements and services normally provided by the accountant in connection with statutory and regulatory filings. Audit-related fees include amounts reasonably related to the performance of the audit of the registrant’s financial statements and specifically include the issuance of a report on internal controls and, if applicable, agreed-upon procedures related to fund acquisitions. Tax fees include amounts related to services for tax compliance, tax planning, and tax advice. The nature of these services specifically includes the review of distribution calculations and the preparation of Federal, state, and excise tax returns. All other fees include the registrant’s pro-rata share of amounts for agreed-upon procedures in conjunction with service contract approvals by the registrant’s Board of Directors/Trustees.
(e)(1) The registrant’s audit committee has adopted a policy whereby audit and non-audit services performed by the registrant’s principal accountant for the registrant, its investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant require pre-approval in advance at regularly scheduled audit committee meetings. If such a service is required between regularly scheduled audit committee meetings, pre-approval may be authorized by one audit committee member with ratification at the next scheduled audit committee meeting. Waiver of pre-approval for audit or non-audit services requiring fees of a de minimis amount is not permitted.
(2) No services included in (b) – (d) above were approved pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) Less than 50 percent of the hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the most recent fiscal year were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees.
(g) The aggregate fees billed for the most recent fiscal year and the preceding fiscal year by the registrant’s principal accountant for non-audit services rendered to the registrant, its investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant were $3,600,000 and $3,627,000, respectively.
(h) All non-audit services rendered in (g) above were pre-approved by the registrant’s audit committee. Accordingly, these services were considered by the registrant’s audit committee in maintaining the principal accountant’s independence.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Investments.
(a) Not applicable. The complete schedule of investments is included in Item 1 of this Form N-CSR.
(b) Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There has been no change to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.
Item 11. Controls and Procedures.
(a) The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures within 90 days of this filing and have concluded that the registrant’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-CSR was recorded, processed, summarized, and reported timely.
(b) The registrant’s principal executive officer and principal financial officer are aware of no change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable.
Item 13. Exhibits.
(a)(1) The registrant’s code of ethics pursuant to Item 2 of Form N-CSR is attached.
(3) Written solicitation to repurchase securities issued by closed-end companies: not applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
T. Rowe Price International Funds, Inc.
| By | /s/ David Oestreicher | |||||
| David Oestreicher | ||||||
| Principal Executive Officer | ||||||
| Date | December 17, 2021 | |||||
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| By | /s/ David Oestreicher | |||||
| David Oestreicher | ||||||
| Principal Executive Officer | ||||||
| Date | December 17, 2021 | |||||
| By | /s/ Alan S. Dupski | |||||
| Alan S. Dupski | ||||||
| Principal Financial Officer | ||||||
| Date | December 17, 2021 | |||||