Leading ETF provider Invesco Ltd. (NYSE: IVZ) announced the launch of the brand new Invesco S&P/TSX Composite ESG Index ETF (ticker symbol: ESGC) by Invesco Canada Ltd. The ESGC ETF, which will be listed on the TSX, will be the very first Canadian-listed ETF to track the S&P/TSX Composite ESG Index.
What is the S&P/TSX Composite ESG Index? This index uses the S&P and Dow Jones’ Environmental, Social, and Governance (ESG) criteria to select companies from the benchmark Canadian S&P/TSX Composite Index. This unique criterion, for the first time, gives Canadian investors access to notable Canadian companies that strong ESG fundamentals while still offering a risk/return profile similar to the benchmark Index.
ESG investing is also known as “sustainable investing.” This is a style of investing that looks beyond clean balance sheets and returns. Rather ESG investing looks to invest in companies that offer positive returns combined with a positive long-term impact on society, the environment, and the performance of the business. By measuring the sustainability and social impact of an investment in a company, many investors believe that these criteria help to better determine future financial performance. The ESGC ETF specifically screens companies to exclude those involved in tobacco, weapons, thermal coal, and with a disqualifying UN Global Compact score.
Invesco has been one of the first companies to focus on investing in the ESG space, having launched cleantech ETFs in 2005. This will be the ninth ESG focused ETF that Invesco has launched in the Americas. Over half of these ETFs have been around for more than 15 years as well. In the EMEA region, Invesco has eight ESG ETFs that screen companies across three different global regions.
The ESCG ETF has been trading on the TSX since October 8th.