BlackRock has launched a new actively managed global equity ETF providing diversified exposure to companies aligned with climate-conscious and sustainable economy investment themes.
The ETF seeks to diversify across climate-related and sustainable economy investment themes.
The BlackRock Future Climate and Sustainable Economy ETF (BECO US) has been listed on NYSE Arca and comes with an expense ratio of 0.70%.
According to the ETF’s prospectus, the fund may invest in securities from both developed and emerging markets, as well as in any market capitalization range.
Common stocks, preferred stocks, convertible securities, warrants, depositary receipts, ETFs, real estate investment trusts (REITs), and master limited partnerships (MLPs) are all eligible for selection.
Using proprietary BlackRock research, the fund will identify companies poised to benefit from the ongoing development of sustainable energy, the future of transport, the circular economy, and nutrition, among other similar investment themes.
Sustainable energy refers to wind, solar, biofuels, hydro, wave, tidal, geothermal, and other relevant renewable energy businesses, as well as energy conversion, storage, conservation, efficiency, and materials relating to those activities.
The future of transport refers to autonomous and electric vehicles as well as companies that provide infrastructure, such as batteries, and technology for such vehicles.
The circular economy refers to companies that seek to minimize waste by considering the full life-cycle of materials and redesigning products and operations to encourage greater reuse and recycling.
Nutrition refers to firms across the food value chain that are working to build a healthier, more sustainable, secure, and fair food system. Eligible companies will typically include those involved with plant-based and organic foods, food safety and testing, precision farming, agricultural science, land-based aquaculture, water management technologies, supply chain technology, and sustainable packaging.
The ETF also utilizes various stock screening processes as well as portfolio-level analytics to enhance its sustainability. This includes avoiding companies that are known violators of UN Global Compact principles as well as those operating in the following industries: coal & consumable fuels, oil & gas exploration & production, integrated oil & gas, tobacco, distillers & vintners, brewers, casinos & gaming, and firearms & weapons.
At the portfolio level, BlackRock will select and weight constituents in order to reduce aggregate greenhouse gas emissions and ensure the fund is aligned with the Paris Agreement’s objective of limiting global warming to 2 degrees above pre-industrial levels by 2050.