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What's New In Investments, Funds? – BlackRock

The latest news on investment offerings, financial products and other services relevant to wealth advisors and their clients.
BlackRock has
launched a range of UK-domiciled sustainable iShares index mutual
funds to address what the US firm says is a gap in the UK wealth
market for strategies that help clients make a sustainable
transition with indexing.
The range comprises five funds covering regional and
country-specific equity exposures which maximize ESG
characteristics, reduce carbon emissions intensity by at least 30
per cent whilst remaining close to the parent benchmark,
BlackRock said in a statement yesterday.
The firm said it is launching the offerings at a time when the UK
is entering a period of “accelerated growth for indexing across
wealth portfolios.” BlackRock said it expects levels of 10
to 20 per cent within the portfolios of financial advisors,
traditional and digital wealth managers and private banks to
double over the next three years.
“Investors across the country, including pension funds, wealth
managers and private banks, are turning to solutions that enable
them to incorporate ESG considerations into their standard
portfolios,” Manuela Sperandeo, BlackRock’s EMEA head of
sustainable indexing, said.
BlackRock has worked with Morningstar Indexes to create ESG
equity indexes covering global, regional and country-specific
exposures. Each index has been designed to maintain a target
tracking error, assigned for each geography, which reflects UK
investor preferences to match the performance of the parent broad
market indexes closely. The Morningstar ESG Enhanced Index
methodology applies a set of ten exclusionary screens to limit
each fund’s exposure to controversial activities.
As mentioned
here this week, Morningstar has culled more than 1,200 funds
with a combined $1.4 trillion in assets from its European
sustainable investment list, raising questions about how far the
problem of so-called “greenwashing” goes in the industry. (The
term refers to firms allegedly making their investments appear
more eco-friendly than they are.)