LGIM introduces sustainable dividend exchange-traded funds on their online platform.
Legal & General Investment Management Launches Two New Sustainable Dividend-Focused ETFs
Legal & General Investment Management (LGIM) has entered the sustainable investing space with the launch of two new index funds: the L&G Quality Equity Dividends ESG Exclusions Europe ex-UK UCITS ETF (ISIN: IE00BMYDM919) and the L&G Quality Equity Dividends ESG Exclusions Asia Pacific ex-Japan UCITS ETF (IE00BMYDMB35).
Both ETFs fall under Article 8 of the EU's Sustainable Finance Disclosure Regulation (SFDR), signifying a moderate approach to sustainable investing. The funds use a rigorous set of quantitative screenings to select stocks based on quality metrics, dividend characteristics, and sustainability factors.
The L&G Quality Equity Dividends ESG Exclusions Europe ex-UK UCITS ETF focuses on European equities, excluding the United Kingdom, while the Asia-Pacific focused fund, L&G Quality Equity Dividends ESG Exclusions Asia Pacific ex-Japan UCITS ETF, focuses on the Asia-Pacific region. The European fund has an annual cost of 0.25% (TER), while the Asian counterpart is 0.4%.
Companies that pose significant risks to the environment, human rights, labour standards, or anti-corruption are excluded from both ETFs. The exclusion criteria primarily filter out companies involved in controversial weapons, such as landmines, cluster munitions, nuclear weapons, chemical/biological weapons, as well as those breaching global norms on these issues.
Additionally, industries such as tobacco production, adult entertainment, thermal coal mining, and coal-based power generation are excluded. The funds also incorporate additional filtering on governance or severe social/environmental controversies.
Howie Li, ETF head at LGIM, believes that the new ETF range offers a strong proposition for investors seeking quality yields with a sustainable focus. The funds focus on companies that consistently pay and ideally increase distributions, aligning with the typical approach of LGIM's STOXX Europe ESG Leaders Select 30 EUR Index.
For precise and up-to-date details on exclusions, consulting the latest fund prospectus or ESG policy document published by Legal & General Investment Management for these specific ETFs is recommended. The ETFs can be activated by clicking a button in the confirmation email sent by LGIM, and users are advised to check their spam folder if the email is not seen in the inbox.
[1] Source: STOXX Europe ESG Leaders Select 30 EUR Index exclusion criteria.
Other investors may find interest in Legal & General Investment Management's new ETFs, as they offer a unique blend of technology, finance, and sustainability. By employing quantitative screenings that prioritize quality metrics, dividend characteristics, and sustainability factors, these funds provide an opportunity for investors to invest in companies that demonstrate a commitment to environmental, social, and governance (ESG) principles without compromising on financial returns.
