Invesco has launched two ESG-focused ETFs investing in listed companies in Japan and the Pacific region while focusing on the exclusion of “controversial” business practices.
The exchange-traded funds have been designed to follow the performance of customised versions of MSCI ESG Universal indices, using the same methodology as Invesco’s existing ESG ETFs investing in other regions.
Any stocks involved in practices such as civilian firearms, oil sands, or recreational cannabis will be excluded. The funds will increase exposure to companies that are actively improving their ESG profile, according to the firm.
Chris Mellor, head of Europe, Middle East and Africa ETF equity and commodity product management at Invesco, said: “Different investors will often vary in their objectives, and this is most evident in the ESG space. Generally speaking, the more you exclude from an index, the more likely the performance will deviate from the base index.
“While that is acceptable for some investors, it’s not for others. Many want to reduce their portfolio’s carbon footprint and improve other ESG characteristics but at the same time maintain their overall risk and expected returns,” he added.
The latest additions to Invesco’s ESG-focused ETF range are named Invesco MSCI Japan ESG Universal Screened Ucits ETF, and Invesco MSCI Pacific ex Japan ESG Universal Screened Ucits ETF.
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