The funds provide exposure to companies with good ESG performance as selected based on three prerequisites
“The Funds represent an important addition to our product shelf as they provide a meaningful way for investors to diversify their portfolios while allocating capital towards some of today's most pressing global issues,” said Rohit Mehta, president of CI First Asset ETFs and executive vice-president of CI Financial, the parent company of CI.
The CI First Asset MSCI World ESG Impact ETF, trading on the NEO Exchange, is available as Canadian dollar hedged common units (CESG) and unhedged common units (CESG.B).
“As the first Canadian exchange to partner with the Sustainable Stock Exchanges Initiative, we acknowledged our responsibility as a stock exchange in fostering greater awareness of ESG factors across the whole investment spectrum, and understood at an early stage how important ESG investing would become in the global capital markets,” said NEO President and CEO Jos Schmitt. “Welcoming yet another industry leader with an ESG impact fund to our exchange is a testament to the benefits of and continued need for the right competition in Canadian capital markets.”
CESG has been designed to replicate the performance of the MSCI World ESG Select Impact ex Fossil Fuels Index Hedged to CAD net of expenses, while CESG.B has been designed to track the performance of the MSCI World ESG Select Impact ex Fossil Fuels Index, net of expenses.
Both the hedged and unhedged indexes are formulated to represent a strategy that targets large- and mid-cap companies across 23 developed countries based on:
- Thematic investing – companies whose products and services address key sustainability areas such as green buildings, energy efficiency, pollution prevention, and treating major diseases;
- Impact investing – companies that are aligned with at least one of the United Nations Sustainable Development Goals; and
- Exclusionary screening of fossil fuels – companies for inclusion must not own fossil fuel reserves used for energy purposes
Both CESG and CESG.B are offered with a management fee of 0.55%.
CI Investments has also introduced the CI MSCI World ESG Impact Fund, a mutual fund that invests all or substantially all of its assets in unhedged common units of the ETF.
“ESG issues are some of the most important drivers of change in the world today," said Roy Ratnavel, head of Sales for CI Investments and executive vice-president of CI Financial. “Companies are increasingly rethinking the ways in which they conduct business, while investors are re-evaluating traditional investment approaches.”