VanEck is set to launch a global equities ETF on the ASX to meet investors' shifting preferences for sustainable options.
The VanEck Vectors MSCI International Sustainable Equity ETF, to list under ticker code ESGI, will invest in international companies using in-depth sustainability criteria.
The fund charges management fees of 0.55% per annum and will track the MSCI World ex Australia ex Fossil Fuel Select SRI and Low Carbon Capped Index.
The index excludes companies with fossil fuel reserves and high carbon emission; operate in alcohol, gambling, tobacco, military weapons, civilian firearms, nuclear power, adult entertainment and genetically modified organisms.
VanEck managing director and head of Asia Pacific Arian Neiron said the ETF is a "true-to-label sustainable international equity fund" incorporating both values-based and impact investing.
"The ETF is a response to investor demand as investors are re-evaluating traditional investment approaches and are shifting their wealth into investments that reflect their personal values and that have a positive impact on society and future generations," said Neiron.
ESGI will appeal to investors that are steering their businesses in a more sustainable and responsible direction, he said, adding a growing body of research reveals that investing in companies that successfully respond to these challenges can deliver improved long-term portfolio performance.
Neiron added: "With increased demand from institutional and retail investors for sustainable investing, and a recognition in the financial community that ESG factors play a material role in determining risk and return, we expect this low-cost smart beta international equity ETF to appeal strongly to investors."
In late January, the exchange-traded product issuer promoted Neiron to head the Asia Pacific operations, while current director of intermediary and institutions, Matthew McKinnon, will take on the role of head of business development for APAC.
VanEck Australia general counsel Russell Grigg is now also head of compliance - APAC; vice president of business development Nicholas Jackson will oversee private banks and family offices in the region; and Bradley Livingstone-Foggo is now responsible for leading the firm's marketing strategy in both Australia and the wider APAC region.
Australia's ETP assets stood at $35 billion at the end of 2017, according to VanEck figures.