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The two new funds track indices consisting of companies with MSCI environmental, social and
governance (ESG) ratings level BB and above. This metric rates companies on 37 key ESG factors
including carbon emissions and business ethics. The indices aim to minimise exposure to activities
involving alcohol, tobacco, gambling, civilian firearms, military weapons, nuclear power, adult
entertainment and genetically modified organisms (GMOs).
The iShares Sustainable MSCI Emerging Markets SRI UCITS ETF (SUSM) tracks the MSCI
Emerging Markets SRI index, which includes large and mid-cap equities across 23 emerging market
countries. The iShares Sustainable MSCI USA SRI UCITS ETF (SUAS) tracks the MSCI USA SRI
Index, which includes large and mid-cap companies in the USA.
Both funds are physically-replicating, meaning they buy the securities of the index, and have a total
expense ratio of 0.35% and 0.30% respectively.
Tom Fekete, Head of Product for iShares EMEA, commented: “The investment goal of many
investors includes generating positive long-term and sustainable impact, and this approach is growing
into a mainstream trend. These two funds seek to provide this growing group of investors with the tools
to be nimble and cost-effective in their portfolio allocation across asset classes. This is an exciting area
of innovation that we will continue to focus on over the next few years.”
iShares, BlackRock’s ETF business, launched the iShares Euro Corporate Bond Sustainability
Screened 0-3yr UCITS ETF (SUSE) earlier this year. BlackRock currently manages more than
USD$200 billion of assets across ESG screened and impact funds globally. iShares is a global leader
in sustainable ETF investing, and offers a range of developed and emerging equity, as well as corporate
bond ETFs[[Source: BlackRock as at June 2016]].
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