BlackRock has launched a corporate bond ETF tracking the Paris-Aligned Benchmark (PAB) with €50m in seed capital.
The iShares € Corp Bond ESG Paris-Aligned Climate UCITS ETF (CBUJ) is listed on Xetra with a total expense ratio of 0.15%.
CBUJ tracks the Bloomberg MSCI EUR Corporate Climate Paris Aligned ESG Select index which tilts issuer weights to maintain diversification while in line with the PAB.
The ETF will look to capture opportunities arising from the transition to a lower-carbon economy while screening out businesses exposed to oil, gas, thermal coal, controversial weapons and high carbon electricity.
The index also has additional ethical screens and will exclude the lowest-rated ESG issuers.
The launch comes after Bloomberg and MSCI unveiled a suite of Paris-aligned fixed income indices in April.
The Bloomberg MSCI global, euro and US corporate Paris-Aligned indices combine Bloomberg’s fixed income indices with MSCI’s climate data research and analytics for corporate bonds.
Manuela Sperandeo, head of sustainable indexing for EMEA at BlackRock’s said: “The transition will require investors to embrace new strategies, and ETFs are playing a central role as foundational building blocks for people seeking out affordability, transparency and convenience.
“Our focus remains on providing a broad and deep set of sustainable investment tools that help investors make informed choices. This launch provides investors with a consistent approach across BlackRock equities and fixed income PAB ETFs, ensuring solutions are available to build multi-asset Paris Aligned Benchmark portfolios.”
In February, Tabula Investment Management expanded its fixed income range with the launch of Europe’s first euro high yield bond Paris-aligned climate ETF.