The world’s largest asset manager, BlackRock, has developed a range of sustainable exchange-traded funds (ETFs) together with disclosures on environmental, social and governance (ESG) factors, model portfolios and portfolio analytical tools.
The new products are intended to help investors align their values with their long-term financial objectives, according to BlackRock. The fund manager has predicted the assets in ESG-oriented ETFs will rise to $313 billion by 2028, driven by strong demand from retail and institutional investors. The new ETFs, part of the iShares range, are part of the Core ETF series, which was created in 2014 for European investors. BlackRock vice chairman, Philipp Hildebrand, commented: “Increased transparency on the sustainability profile of their investment portfolios will enable investors to understand the potential ESG-related risks and opportunities they are exposed to. Strong ESG performers are more resilient and this has led to an irreversible move from an era of asking ‘why?’ to ‘why not?’ in sustainable investing.”
The sustainable ETFs use MSCI indices to cover global equities, Japan, emerging markets, Europe and the USA. They screen out controversial weapons, nuclear weapons, civilian firearms, tobacco, companies in breach of the UN global compact principles, thermal coal and oil sands. The total expense ratio varies from seven basis points to 20 basis points.