HSBC Asset Management (HSBC AM) announced today the launch of two new ETFs designed to enable investors to integrate net zero considerations into their portfolios, and tracking Paris Aligned Benchmarks.
Indices that are labelled as Paris-aligned Benchmarks (PABs) under EU rules must meet criteria for asset selection that results in the index aligning with the long-term climate goals of the Paris Agreement. Criteria include a minimum reduction in greenhouse gas (GHG) emissions intensity of at least 50% compared to the market index, with annual GHG emissions intensity reductions of at least 7%, among others.
The new ETFs will track the MSCI Emerging Markets Climate Paris Aligned benchmark Index and the MSCI AC Asia Pacific ex Japan Climate Paris Aligned benchmark Index. According to MSCI, the indices were designed to “support investors seeking to reduce their exposure to transition and physical climate risks and who wish to pursue opportunities arising from the transition to a lower-carbon economy while aligning with the Paris Agreement requirements.”
The launch expands HSBC AM’s Paris-aligned benchmark equity ETF range to six funds, adding to the current roster of the HSBC MSCI World, USA, Europe, and Japan Funds.
The funds will be listed on the London Stock Exchange, with further listings expected in Europe, and will be classified as Article 9 under the EU’s Sustainable Finance Disclosure Regulation (SFDR).
Olga de Tapia, Global Head of ETF & Indexing Sales, HSBC AM, said:
“Enabling our clients to improve the social and environmental impact of their portfolios is a priority for us. With the addition of these two new ETFs, we’re pleased to provide investors and asset allocators a comprehensive suite of core PAB building blocks.”