Franklin Templeton has launched the Franklin MSCI World Catholic Principles UCITS ETF, designed to provide exposure to large and mid-cap stocks of companies considered environmentally and socially responsible in developed market countries.
The fund – listed as Article 8 under the EU’s Sustainable Finance Disclosure Regulation (SFDR) – tracks the performance of the MSCI World Select Catholic Principles ESG Universal and Low Carbon Index and brings the total number of Article 8 compliant ETFs at the firm to 12.
The index tracked by the ETF excludes companies involved in controversial businesses, such as civilian firearms, nuclear weapons and controversial and conventional weapons. Meanwhile, investment in businesses involved in gambling, tobacco and thermal coal is significantly restricted and based on revenue generated from these activities.
To align with Catholic values, the index also has three additional exclusions – abortion and contraceptives, animal testing and stem cell research.
Focusing on such companies with lower carbon exposure and higher ESG ratings, index holdings must have a minimum of a ‘BB’ MSCI ESG rating. As a result, the ETF currently has an overall MSCI ESG rating of AA.
The fund will be managed by Dina Ting, head of global index portfolio management, and Lorenzo Crosato, ETF portfolio manager, at Franklin Templeton.
Caroline Baron (pictured), head of ETF distribution, EMEA, Franklin Templeton, commented: “Following the launch of the Franklin Catholic Principles Emerging Markets Sovereign Debt UCITS ETF two years ago and further to client interests, we are delighted to expand our offering of values-based products and introduce this new MSCI World Catholic Principles UCITS ETF to European investors.
“With this new fund we wanted to offer investors an ESG-focused global equity strategy within an ETF structure that incorporates specific Catholic values but also provides a core equity article 8 compliant solution.”
The fund will list on the Deutsche Börse Xetra on 25 April, London Stock Exchange on 26 April and Borsa Italiana on 9 May. The ETF is registered in Austria, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Spain, Sweden and the UK.
