Vanguard launches two new environmental, social and governance focused Exchange Traded Funds

Vanguard launches two new environmental, social and governance (“ESG”) focused Exchange Traded Funds (“ETFs”). The Vanguard ESG EUR Corporate Bond UCITS ETF and the Vanguard ESG USD Corporate Bond UCITS ETF are designed to serve as core building blocks for ESG-aware portfolios.

The new ETFs have been listed on the London Stock Exchange (LSE), Deutsche Börse, Borsa Italiana, Six Swiss Exchange and Euronext Amsterdam.

The Vanguard ESG EUR Corporate Bond UCITS ETF tracks the Bloomberg MSCI EUR Corporate Liquid Bond Screened Index. The ETF has an ongoing charges figure (“OCF”) of 0.11% for unhedged share classes, and 0.16% for hedged shareclasses.

The Vanguard ESG USD Corporate Bond UCITS ETF tracks the Bloomberg MSCI USD Corporate Float-Adjusted Liquid Bond Screened Index. The ETF has an ongoing charges figure (“OCF”) of 0.11% for unhedged share classes, and 0.16% for hedged shareclasses.

Vanguard’s exclusionary ESG funds track benchmarks that are derived from commonly used and available market-capitalisation-weighted indices, provided by independent benchmark providers, which give a weighted exposure to companies in the relevant target markets. Vanguard’s benchmark providers then apply transparent screening criteria^[1] to avoid or reduce exposure to certain industries or business activities that may not be aligned with investors ESG preferences, such as firearms, tobacco or fossil fuels.

Fong Yee Chan, head of ESG strategy, UK and Europe, said: “At Vanguard, we take a straightforward approach to ESG that enables investors to create portfolios that incorporate their environmental, social and governance preferences and gives them the best chance for investment success. Today’s launches provide additional building blocks for investors seeking to construct broadly diversified, balanced portfolios, at a low cost, in a way that aligns with their preferences.”

The new ETFs are managed by Vanguard’s Fixed Income Group, which manages more than $1.6 trillion in assets across the globe, and draws on the diverse perspectives and knowledge of more than 170 team members[2].

With the addition of the new products, Vanguard now offers a range of 17 different ESG oriented investment options for European retail investors across our Irish and UK domiciled platforms, with assets of over $6.5 billion. These are available through Vanguard UK Personal Investor (www.vanguardinvestor.co.uk), retail investment platforms and via financial advisers and wholesale intermediaries.