Industry Investment Technology

A New Wave of ESG Investment Products Launch in the Wake of COVID-19 – Part 3

Lyxnor launches Paris agreement aligned ESG ETF series

Adding to their existing ‘ecosystem’ of ESG ETF’s, Lyxnor has launched 4 further ETFs tracking S&P Paris-aligned climate indices for Eurozone, European US and global equities. The tracked equities must also target global warming of 1.5 degrees as a maximum and adhere to the Task Force for climate-related Financial Disclosure.

Each of the ETF portfolios are targeted to achieve a 7% year on year CO2 reduction and a total reduction of 50% by 2030. Emissions from each business’ entire value chain will be encompassed in this goal. On top of ambitious emissions targets, the portfolios will also be managed on an exclusionary basis, not allowing companies operating above certain margins in fossil fuels, as well as other controversial industries such as weapons and tobacco.

The Eurozone fund was listed earlier this week on Euronext and will soon be listed on the London Stock Exchange. Arnaud Llinas, head of Lyxor ETF and indexing, said: “EU climate benchmarks are just one of the ways Europe is taking the lead on climate. At Lyxor, we believe in the power of indices and ETFs to build on data and shift capital at scale towards a climate neutral economy.”

“With this latest enhancement to our climate ETF ecosystem, we are helping investors take their decarbonisation ambitions to the next level as well as adopting an even greener approach through fossil fuel exclusions.”

ASI debuts emerging market equity fund with sustainable focus

Aberdeen Standard SICAV has launched a new fund targeting businesses performing well in the ESG sphere, and those making concerted efforts to improve their credentials. This targeting is to be achieved through a bottom up analysis of each business based upon the sustainability of their business model as well as ESG alignment. A score is then assigned to each firm based upon this which is used as the basis of each investment decision.

The ‘Emerging Markets Sustainable and Responsible Investment Equity fund’ is the first of two responsible investment strategies launched by the investment company’s emerging markets team.

“The new SRI fund combines two key strengths of our business – emerging markets and ESG investment. We have a long history in emerging markets investment and ESG considerations have been incorporated in our stock analysis and decision-making for over 25 years.” Said Fiona Manning, ASI investment director.

“By analysing the foundations of the business and a thorough evaluation of the ESG risks and opportunities, we have identified companies which we believe to be sustainable leaders or improvers. With this approach we can reduce risk, enhance potential value for our investors and invest in companies that can contribute positively to the world.”

Blackfinches Ethical IHT Portfolio places emphasis on renewables

Blackfinch adds ethical edition to range of IHT portfolios

The Ethical Adapt IHT portfolio will focus on renewable energy and other low carbon projects and target an ROI of 3%. While the return target of this ethical edition of the tax efficient portfolio series is notably lower than its contemporaries, its impact focused mission statement may be attractive to investors looking to put their capital to meaningful work, rather than simply meeting minimum limits of acceptability.

Richard Cook, Founder and Chief Executive Officer of Blackfinch Group, said: “Blackfinch has the ability to adapt to shifting markets and customer needs, providing the strongest possible solutions. Our ESG-focused IHT range can support advisers in working with clients. And our capabilities in renewables, and property, mean we can offer even more choice in investing.”

Comment

With ESG or ethically focused products launching faster than ever, sustainable investors will to put their minds now more than ever to what exactly they want from their investment products. Lyxnor’s ESG offerings may appeal to investors wishing to leverage the hands off, aggregate power of the ETF with more stringent enviromental standards than both Fidelity and UBS‘ alternatives. ASI’s fund is likely to attract the socially focused investor with faith in classical, analyst based portfolio design, while Blackfinches offering lends itself to an impact style capitalist.


  1. James Baxter-Derrington, International Investment July 2020
  2. Imogen Tew, FT Advisor July 2020
  3. Wealth Advisor July 2020