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, while the iShares Sustainable MSCI USA SRI UCITS ETF (SUAS) tracks the MSCI USA SRI Index, which includes large and mid-cap companies in the US.
The two new funds have been launched in order to address growing investor demand for long term, socially-responsible investments, according to BlackRock. They track indices consisting of companies with an MSCI environmental, social and governance ratings level of BB and higher.
Both funds are physically-replicating, meaning they buy the securities of the relevant index, and have a total expense ratio of 0.35% and 0.30%, respectively.
Companies invested in are rated on 37 ESG factors including carbon emissions and business ethics, and the indices aim to minimise exposure to activities involving alcohol, tobacco, gambling, civilian firearms, military weapons, nuclear power, adult entertainment and genetically modified organisms.
BlackRock’s ETF business iShares manages more than $200bn of assets across ESG screened and impact funds globally.
“The investment goal of many investors includes generating positive long-term and sustainable impact, and this approach is growing into a mainstream trend,” said Tom Fekete, head of product for iShares EMEA. “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,” added Fekete.