Saving the Environment gets Easier with the World's First Carbon Neutral ETF

The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.

Significant concerns have been rising for some time now about global temperatures, greenhouse gases, and carbon emissions. Many people (especially members of the younger generations) want to be able to take tangible action to help environmental efforts. Using investments as a tool to help support the earth can be a great way to be involved, especially now that Canadian investment firm Evolve ETFs has created the Evolve S&P 500 CleanBeta™ Fund (FIVE) and Evolve S&P/TSX 60 CleanBeta™ Fund (SIXT), which make up the world’s first carbon-neutral exchange-traded funds (ETFs) based on traditional indices. 

The ETFs use a company called Trucost (an S&P Global company) to calculate the carbon footprint of constituents in the S&P 500 and S&P/TSX 60. The fund then purchases and immediately retires carbon credits to neutralize the full carbon footprint of the fund.

Evolve Pushes Ahead in ESG

Benzinga recently talked to Evolve ETFs CEO Raj Lala about the FIVE and SIXT ETFs. Lala reiterated the underlying purpose and reason beyond them, saying, “In a perfect world our fund doesn’t exist because governments and institutions are already net-neutral, but we don’t live in that perfect world yet.” As a leader in disruptive innovation, Evolve has seen significant growth through its innovative products in the Canadian ETF industry.

Regarding this growth and the future of Evolve, Lala said, “We’ve tripled our assets in the last 12 months. Our pure focus right now is to get the market to digest what we’ve already brought out.” Now that FIVE and SIXT are in the market, Evolve is dedicated to educating investors and advisors on ESG investing and getting more people on board. 

However, it’s not completely easygoing. While a large number of millennials and younger individuals consider environmental, social, and governance (ESG) investing and carbon neutrality to be important, many of the older generation and companies have yet to jump aboard. Evolve is making it as easy as possible to enable these investors and institutions to access carbon neutrality. 

“All of the bank pensions are out there telling their customers the importance of net-zero emissions. It should be a very simple shift for them to take their S&P/TSX60 or S&P 500 positions and switch them over,” Lala said.

The situation is changing, though, as the world gets closer to a gigantic generational wealth transfer estimated to be worth up to $68 trillion. This bodes well for ESG investing and ETFs like FIVE and SIXT.

“Mostly millennials are going to be inheriting those portfolios,” Lala said. “Just in Canada about $700 billion will be changing hands soon.”

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.