BlackRock has followed in the footsteps of other European issuers in launching an environmental, social and governance (ESG) ETF targeting German equities.
The iShares DAX ESG UCITS ETF (EXIA) is listed on the Deutsche Boerse with a total expense ratio (TER) of 0.12%.
Tracking Qontigo’s DAX ESG Target index, EXIA aims to replicate the performance of the DAX parent index while reducing its carbon intensity by at least 30%.
The new index follows a consultation last year, in which participants asked for a clear separation between ESG benchmarks and their original core equivalents.
The DAX ESG Target index has 30 constituents and reweights to meet tracking error constraints, CO2 reduction goals and incorporates Sustainalytics ESG ratings. The index also applies Global Standards Screening and product involvement screens for controversial weapons, tobacco, thermal coal, nuclear power and oil sands.
Dirk Schmitz, country head for Germany, Austria and Eastern Europe at BlackRock, said: “DAX companies do business on an international level. This means that in addition to their roots in the domestic market, they are also closely linked to the global economy.
“In this respect, EXIA reflects the strength of a large part of the German economy as well as the global economy. This makes it interesting for domestic and international investors.”
Stephan Flaegel, chief product officer at Qontigo, added: “Earlier this month, the German federal government announced a new green financing strategy to steer capital towards environmental projects and develop Germany into a major hub for sustainable finance.
“Germany is taking a leading position on the global stage with a strong trend towards sustainable investing.”
EXIA comes to market following the launch of a similar product, the CSIF IE DAX 50 ESG Blue UCITS ETF (DXESG), earlier this week.
It also comes after Lyxor and Amundi unveiled similar ETFs, the Lyxor DAX 50 ESG UCITS ETF (E909), which launched last April and the Amundi DAX 50 ESG UCITS ETF (DECD) which came to market last December.