The SPDR® S&P® World ex Australia Carbon Aware ETF seeks to closely track, before fees and expenses, the returns of the S&P Developed Ex-Australia LargeMidCap Carbon Aware Index.
The Fund aims to provide investors with the performance of the various indices of the Underlying Funds in which the Fund invests, in proportion to a ‘Balanced’ long term Strategic Asset Allocation (SAA), before fees and expenses, of approximately 50% equities and 50% fixed income exposure.
MCCL.ASX is a concentrated portfolio of global companies enabling or benefiting from the transition to decarbonise the planet. The Munro Climate Change Leaders Fund Active ETF was quoted on the ASX on 20 January 2022 with ticker MCCL.
ERTH aims to track the performance of an index (before fees and expenses) that comprises a portfolio of up to 100 leading global companies that derive at least 50% of their revenues from products and services that help to address climate change and other environmental problems through the reduction or avoidance of CO2 emissions. This covers clean energy providers, along with leading companies tackling green transport, waste management, sustainable product development, and improved energy efficiency and storage.
The SPDR® S&P®/ASX 200 ESG ETF seeks to closely match, before fees and expenses, the returns of the S&P/ASX 200 ESG Index.
The fund aims to invest in a portfolio of ethically and socially responsible undervalued companies to achieve medium to long-term capital growth.
The SPDR® S&P® Emerging Markets Carbon Aware ETF seeks to closely track, before fees and expenses, the returns of the S&P Emerging LargeMidCap Carbon Aware Index.
The Fund aims to provide investors with the performance of the MSCI World Ex Australia Custom ESG Leaders Index 100% Hedged to AUD, before fees and expenses. The index is designed to measure the AUD hedged performance of global, developed market large and mid- capitalisation companies with better sustainability credentials relative to their sector peers.
The Fund aims to provide investors with the performance of the MSCI Australia IMI Custom ESG Leaders Index, before fees and expenses. The objective of the Fund is to provide exposure to large, mid and small cap segments of the Australian market with better sustainability credentials relative to their sector peers.
The Fund’s performance objective is to provide investment returns which exceed conventional global equity indices (hedged to Australian dollars), after management fees, over the long term.
ETHI aims to track the performance of an index (before fees and expenses) that includes a portfolio of large global stocks identified as “Climate Leaders” that have also passed screens to exclude companies with direct or significant exposure to fossil fuels or engaged in activities deemed inconsistent with responsible investment considerations.
The Fund will invest in early-stage high potential growth companies, with a focus on seed stage and follow-on investments. (For Wholesale Investors Only)
The Perpetual ESG Australian Share Fund is an actively managed fund, targeting long-term capital growth and income through investment predominantly in quality Australian shares that meet Perpetual’s ESG and values-based criteria.
FAIR aims to track the performance of an index (before fees and expenses) that includes Australian companies that have passed screens to exclude companies with direct or significant exposure to fossil fuels or engaged in activities deemed inconsistent with responsible investment considerations.
A diversified portfolio of leading global sustainable companies that have a net positive alignment to the United Nations Sustainable Development Goals, exceed Alphinity’s minimum ESG criteria and offer attractive prospective returns. The strategy aims to provide consistently strong risk-adjusted returns across different market cycles by applying a disciplined and repeatable investment process to our global sustainable universe.
As the world grapples with environmental and social challenges, investors are increasingly turning their attention to strategies that not only deliver financial returns but also promote positive change. Environmental, Social, and Governance (ESG) investing has emerged as a powerful tool that aligns financial interests with ethical and sustainable values.
Below we'll explore the concept of ESG investing, its principles, benefits, and its growing importance in the world of finance.
ESG investing involves the integration of environmental, social, and governance factors into investment decision-making. It goes beyond traditional financial analysis by considering a company's impact on the environment, its social practices, and the quality of its corporate governance. ESG investing seeks to generate sustainable long-term returns while creating positive impacts on society and the planet.
The primary factors of ESG investing:
Environmental, Social, and Governance (ESG) strategies are investment approaches that take into account a company's ESG factors when making investment decisions. These strategies aim to align financial returns with ethical and sustainable considerations. There are several different ESG strategies that investors can utilise:
There are several common ESG investment themes:
This category includes investments in companies and projects involved in renewable energy sources like wind, solar, hydropower, and geothermal. Examples of renewable energy investments may include stocks of solar panel manufacturers, wind farm operators, or renewable energy infrastructure funds.
Clean technology investments focus on companies and technologies that promote environmental sustainability and resource efficiency. This can encompass areas like energy efficiency, waste reduction, and emissions reduction. Examples include investments in companies developing electric vehicles, energy-efficient appliances, or advanced recycling technologies.
Investments in sustainable agriculture and food production aim to support practices that reduce environmental impact, promote responsible land use, and improve food security. This can include investments in organic farming, sustainable fisheries, or plant-based food companies.
Companies involved in efficient water management and wastewater treatment are integral to sustainability efforts. Investors can support such initiatives by investing in water technology firms, water utilities, or companies specializing in wastewater treatment solutions.
The main features and reasons for investing in ESG include:
There are three main types of risks to consider when investing in ESG:
When comparing Environmental, Social, and Governance (ESG) investments, it's essential to assess the key factors to make informed investment decisions that align with your values, financial goals, and risk tolerance. Here are the main factors to consider:
Investing in ESG assets in Australia can be done through various methods and investment vehicles, depending on your preferences, financial goals, and risk tolerance. Here are the main ways to invest in ESG:
ESG-focused ETFs track indices or benchmarks composed of companies that meet specific ESG criteria. Investing in ESG ETFs provides diversification across multiple ESG-focused companies within a particular theme or region.
ESG funds are actively managed and include a selection of stocks and/or bonds that adhere to ESG principles. Professional fund managers make investment decisions based on ESG criteria, aiming to achieve ESG goals while delivering competitive returns.
These funds are dedicated to generating measurable positive social or environmental impacts, alongside financial returns. These funds prioritise achieving specific, quantifiable outcomes, such as reducing carbon emissions, improving access to clean water, or advancing gender equality.
Investors can build their own ESG portfolio by purchasing individual stocks of companies that align with their ESG preferences.
ESG investing has emerged as a powerful tool for aligning investments with sustainable and ethical considerations. By understanding the different types of ESG investments, their features, risks, and how to compare and invest in them, investors can make informed decisions to drive positive change while pursuing financial goals.
ESG investing allows investors to align their financial goals with their values. It can also help mitigate risks associated with environmental and social issues, as companies with strong ESG performance tend to be more resilient in the long term.
There are various ways to identify ESG investments. Investors can look for companies that are part of ESG indexes or funds, review ESG ratings and reports, or consider investment managers who specialize in ESG strategies.
While financial returns vary, research suggests that companies with strong ESG performance tend to outperform their counterparts over the long term. By integrating ESG factors, investors can potentially identify companies with sustainable business models and strong growth prospects.
Yes, ESG investing can influence corporate behaviour. As investors increasingly prioritize ESG factors, companies are incentivised to improve their ESG practices to attract and retain investors. This can lead to positive changes in corporate behaviour and sustainability efforts.
ESG ratings assess a company's performance on environmental, social, and governance factors. Ratings agencies evaluate companies based on specific criteria, such as carbon emissions, labour practices, board diversity, and transparency. These ratings provide investors with a standardised measure of a company's ESG performance.
This article contains information of a general nature only, and should not be regarded as advice, either general or personal. Anybody considering investing in managed funds should seek professional financial and legal advice prior to making investment decisions.
