The transition away from polluting industries towards innovative, ethical and sustainable companies is well under way. As such, investors are becoming increasingly determined to invest in a way that aligns with their values, with responsible investing growing in popularity.
With BetaShares’ range of ethical ETFs, Australian investors can now easily invest in a diversified portfolio of sustainable, socially responsible companies, in a single, cost-effective ASX trade – whether the focus is on fixed income or Australian or global shares.
- BetaShares Global Sustainability Leaders ETF (ASX Code: ETHI)
Access to a diversified portfolio of 100 ethical and sustainable companies from around the globe.
- BetaShares Australian Sustainability Leaders ETF (ASX Code: FAIR)
Access to a diversified portfolio of ethical and sustainable Australian companies.
We also offer an ethical ETF providing exposure to fixed income:
- BetaShares Sustainability Leaders Diversified Bond ETF – Currency Hedged (ASX Code: GBND)
Access to a diversified portfolio of Australian and global bonds meeting strict ethical standards.
The screening process: What’s in? What’s out?
BetaShares ethical ETFs were the first in Australia to combine a positive climate leadership screen with a broad set of environmental, social and governance (ESG) criteria, offering investors a true-to-label, socially responsible investment option.
Here’s how the screening process works:
ETHI and FAIR screening:
Starting with a universe of large global or ASX-listed companies.
This universe of companies is screened to remove companies with direct, or indirect, involvement to the fossil fuel industry (for example, large mining companies, or banks that fund such projects are removed).
The remaining companies are then further screened, and companies with exposure to activities and industries that are harmful to people and the planet are taken out.
These include industries like gambling, tobacco, junk food and animal cruelty, to name a few.
Companies involved in positive sustainability and ethical business operations such as developing renewable energy sites, healthcare companies, healthy food companies and more, are preferenced in the portfolio.
Bond issuers (aside from sovereign issuers) are screened to exclude issuers that have material exposure to the fossil fuel industry or provide material financing to the fossil fuel industry (although green bonds from such issuers may be eligible).
The remaining bond issuers are further screened, to remove issuers with exposure to activities considered to carry other significant ESG risks. These include industries such as gambling, tobacco, junk food and animal cruelty.
Sovereign bond issuers are screened to exclude issuers that are subject to current sanctions as a result of human rights concerns imposed by bodies such as the U.N. and the E.U.
At least 50% of the portfolio at each rebalance will comprise ‘green bonds’, issued to fund projects that have environmental and/or climate benefits. To be eligible a green bond must have been certified by the Climate Bonds Initiative (CBI).
ETHI, FAIR and GBND aim to provide socially responsible investors important benefits:
In one simple ASX trade, investors gain exposure to a diversified portfolio of shares or bonds.
Investors can view each fund’s portfolio holdings, performance information and net asset value daily on our website.
- Low cost
BetaShares’ ethical ETFs aim to track the performance of an index, so there are no “active manager” fees to worry about. Management fees are1:
- ETHI: 0.59%, or just $59 for every $10,000 invested
- FAIR: 0.49%, or just $49 for every $10,000 invested
- GBND: 0.49%, or just $49 for every $10,000 invested.
How to invest
These ETFs can be bought or sold on the ASX just like any share, using the ASX code ETHI, FAIR or GBND.
ETHI, FAIR AND GBND TRADING NOW ON THE ASX
ETHI and FAIR have been certified by RIAA according to the strict operational and disclosure practices required under the Responsible Investment Certification Program. See www.responsibleinvestment.org for details.2
1. Other fees and costs, such as transactional and operational costs, may apply. Please refer to the relevant PDS for more information.
2. The Responsible Investment Certification Program does not constitute financial product advice. Neither the Certification Symbol nor RIAA recommends to any person that any financial product is a suitable investment or that returns are guaranteed. Appropriate professional advice should be sought prior to making an investment decision. RIAA does not hold an Australian Financial Services Licence. www.responsibleinvestment.org