LONDON - Xtrackers (IE) plc, an investment company with variable capital, has announced changes to a suite of its exchange-traded funds (ETFs), including updates to their reference indices and the enhancement of Environmental, Social, and Governance (ESG) exclusion criteria. The modifications, informed to the company by MSCI Limited, the index administrator, were implemented on Tuesday.
The affected funds, which cover a range of regions including the World, USA, Japan, Europe, EMU, and Emerging Markets, have had their reference indices renamed to reflect a "Low Carbon SRI Selection" focus, signifying a strategic shift towards sustainability and responsible investing. This change aligns with the growing investor demand for ESG-focused financial products.
Furthermore, the ETFs' index methodology now includes an enhanced oil & gas screen, broadening the scope of industries subject to ESG exclusion criteria. These criteria now encompass sectors like alcohol, tobacco, gambling, adult entertainment, genetically modified organisms, civilian firearms, nuclear weapons, thermal coal, fossil fuel, and fossil fuel-based power generation, in addition to controversial weapons. The updates are in accordance with the requirements laid out in Article 12(1)(a) to (g) of the Commission Delegated Regulation (EU) 2020/1818, also known as PAB Exclusions.
The company has assured shareholders that the funds' investment objectives, policies, risk profiles, and fees remain unchanged despite these updates. Shareholders interested in the detailed changes to the index methodology can refer to the MSCI website.
Revised supplements reflecting these changes for each fund were made available on the company's website on the effective date, with physical copies obtainable upon request at the company's registered office or through foreign representatives.
Investors with queries or seeking clarity have been advised to consult their financial advisors. The announcement also noted that these products are based overseas and not subject to UK sustainable investment labelling and disclosure requirements, directing interested parties to the UK Financial Conduct Authority's website for more information on UK sustainability standards.
The information for this report is based on a press release statement from Xtrackers (IE) plc.
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