Dow Jones Indexes, a leading global index provider, and SAM, the investment boutique focused exclusively on sustainability investing, today announced they have licensed the Dow Jones Sustainability World Enlarged ex All/AE IndexSM and the Dow Jones Sustainability Europe ex All/AE IndexSM to iShares, the exchange traded funds (ETF) platform of BlackRock Inc. (NYSE:BLK).
The license enables iShares’ ETFs to track the performance of the underlying indexes.
iShares’ launch today of the two equity ETFs – the iShares Dow Jones Global Sustainability Screened fund and the iShares Dow Jones Europe Sustainability Screened fund – on the London Stock Exchange (LSE), mark the first sustainable ETFs ever to trade on the LSE.
The Dow Jones Sustainability World Enlarged ex All/AE IndexSM, tracks the performance of the most sustainable 20% of companies out of the largest 2,500 companies in the Dow Jones Global Total Stock Market (DJGTSM) Index, minus companies from the following sectors: alcohol, tobacco, gambling, armaments & firearms, and adult entertainment. The Dow Jones Sustainability Europe ex All/AE IndexSM includes the best 20% of companies — in terms of sustainability — out of the largest 600 European companies in the DJGTSM Index (with the exclusion of the aforementioned sectors). Both indexes are calculated in euros and US dollars.
In keeping with all Dow Jones Sustainability Indexes (DJSI), the components for the indexes are selected according to SAM’s systematic Corporate Sustainability Assessment, which analyzes company performance in terms of economic, environmental and social criteria. The Dow Jones Sustainability World Enlarged ex All/AE IndexSM contains 460 components and the The Dow Jones Sustainability Europe ex All/AE consists of 139 components.
“The decision by BlackRock — one of the world’s premier asset management companies — to license two of our sustainability indexes in order to expand iShares’ ETF platform demonstrates Dow Jones Indexes’ leadership position in this expanding sector,” said Michael A. Petronella, president of Dow Jones Indexes. “With our partners at SAM, we believe these indexes reflect the market’s demand to invest in responsible companies that are committed to a program of long-term sustainability.”
Michael Baldinger, CEO, SAM, commented: “We are pleased to see that our longstanding expertise in sustainability investing is being incorporated into iShares ETFs. We believe these well engineered products will meet investor’s needs.”
Introduced in 1999, the Dow Jones Sustainability Indexes are the longest-running benchmarks that track the performance of sustainability leaders on a global scale. Today, the DJSI family is used by asset managers in 19 countries as a benchmark and investment universe for a wide variety of financial products including ETFs, mutual funds, separate accounts and structured products. Aggregate investment volumes in portfolios tracking the global index series now total more than US$8 billion globally.
“We have seen growing demand from clients for ways in which they can incorporate environmental, social and governance considerations into their investments,” said Axel Lomholt, Head of Product Development for iShares EMEA. “Thus, in choosing to work with Dow Jones Indexes and SAM, we believe iShares has responded by identifying world-class underlying indexes that enable our ETFs to provide exposure to a universe of stocks expected to deliver long-term shareholder value through sustainability.”