Sustainable fund that invests in the U.S. developed by Varma to be listed on London Stock Exchange
Varma has established an exchange-traded fund (ETF) that invests in the U.S. and takes sustainability criteria broadly into account. The ETF was created jointly with the asset management company Legal & General Investment Management (LGIM) and the index investment company Foxberry.
Varma has invested EUR 500 million in the ETF it has developed together with LGIM and Foxberry. The ETF will be listed on the London Stock Exchange on 10 December.
“Sustainability is integrated into Varma’s investment operations, and we also want to actively develop sustainable investment options. As the responsible investment sector grows, the development of index funds with an increasingly responsible tilt is key, and they are precisely where change is needed,” says Timo Sallinen, SVP, Investments.
Varma’s USA ETF allocates to US equities and takes sustainability criteria broadly into account. Companies that are selected as investees are assessed based on how well they take environmental, social and governance issues into account in their operations.
Tobacco companies, industries that manufacture controversial weapons and companies whose operations are based to a large extent on the use of coal and which have the highest emissions and significant fossil fuel reserves are excluded from the index.
The index also does not include companies that have breached international agreements and standards, concerning for instance respect for human rights and the use of child labour.
“Alternatives are needed for exclusion-based products. We believe that co-operation between stakeholders goes a long way in promoting responsible investment. Many investors on their own may lack the resources to thoroughly look into companies for exclusion purposes. With this product, one of our main goals is to reduce the carbon emission of our investment portfolio,” says Sallinen.
USA ETF is the second sustainable fund developed by Varma to be listed on the London Stock Exchange. The first ETF, which allocates to European equities, was listed in September.
Timo Sallinen, Senior Vice-President, Investments, listed equities, tel. +358 40 543 9587, firstname.lastname@example.org
Marjut Tervola, Communications Manager, tel. +358 45 673 0120, email@example.com
Varma Mutual Pension Insurance Company is a responsible and solvent investor. The company is responsible for the statutory earnings-related pension cover of some 900,000 people in the private sector. Premiums written totalled EUR 5.1 billion in 2018 and pension payments stood at EUR 5.7 billion. Varma’s investment portfolio amounted to EUR 47.4 billion at the end of September 2019.
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