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Vanguard releases ETFs for Europe and North America that take ESG factors into account

Vanguard has created two ETFs focused on investments in developed Europe and North America that are intended to be "essential building blocks for ESG-aware portfolios."

The Vanguard ESG Developed Europe All Cap Ucits ETF is based on the FTSE Developed Europe All Cap Choice Index, whereas the Vanguard ESG North America All Cap Ucits ETF is based on the FTSE North America All Cap Choice Index.

The FTSE Global Choice Index series is built from the FTSE Global All Cap Index, which is then vetted by FTSE Russell for specific environmental, social, and corporate governance parameters.

Non-renewable energy (including nuclear power), vice products (including adult entertainment, gambling, alcohol, and cigarettes), weapons, and corporations involved in labour, human rights, environmental, and anti-corruption disputes are all excluded from the screening process.

Fong Yee Chan, head of ESG strategy for the UK and Europe at Vanguard, said: “Over the past couple of years, we have diligently developed our ESG range to enable investors to choose the products that best align with their preferences alongside their investment goals. “These launches are the start of the next stage in that commitment; building out our suite of ‘building block’ ESG ETFs, designed to help investors construct ESG ETF portfolios for the long-term, at a low cost.”

The two new ETFs are managed by Vanguard's Equity Index Group, which has 57 team members and manages more than $4.8 trillion in assets globally. Both ETFs have 0.12% ongoing fees and are traded on the London Stock Exchange, Deutsche Boerse, Borsa Italiana, Six Swiss Exchange, and Euronext Amsterdam. Vanguard's exclusionary ESG funds follow benchmarks derived from indices that provide weighted exposure to large, medium, and small companies in key target areas.


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