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BMO Launches Suite of ESG ETFs to Support Responsible Investing

January 24, 2020 | Sustainability

BMO Asset Management Inc. has announced the launch of seven ESG (environment, social and governance) ETFs, including the first balanced ESG ETF in Canada. The move strengthens our ability to Boldly Grow the Good in business and life by empowering customers to invest their savings in a sustainable way.

“A recent BMO survey shows investors recognize the financial benefit of investing with an ESG lens and are increasingly looking for solutions that align with both their financial and social values.” said Kevin Gopaul, Global Head of ETFs, BMO Global Asset Management. “As an asset manager we have a responsibility to drive and encourage positive change, from active ownership and ESG integration across investments, to product development. This launch of ESG ETFs delivers the full range of solutions and an all-in-one-basket across broad markets that aligns with BMO’s responsible investing strategy.”

Initial results of BMO Asset Management’s ESG Beliefs and Behaviors Survey* found 78 per cent of high income and high net worth investors are ESG-leaning, with 22 per cent actively investing in ESG and 72 per cent strongly agreeing that companies can have positive impact and make a profit. Further, 68 per cent of the respondents strongly agreed that companies should be held accountable for good management and sustainable business practices.

From a performance perspective, industry research points to a positive link between ESG and corporate financial results, as ESG strategies contribute to reduced risk and volatility.

BMO Asset Management Inc.’s new ETFs include:

  • BMO Balanced ESG ETF (ZESG): The first ESG asset allocation ETF in Canada, providing a one ticket low cost solution that includes both major equity markets and fixed income securities through a balanced asset allocation of 60 per cent equity and 40 per cent fixed income exposure.
  • BMO MSCI Global ESG Leaders Index ETF (ESGG)
  • BMO MSCI Canada ESG Leaders Index ETF (ESGA)
  • BMO MSCI EAFE ESG Leaders Index ETF (ESGE)
  • BMO MSCI USA ESG Leaders Index ETF (ESGY): These ETFs deliver ESG exposure by following the best in class approach of the MSCI ESG Leaders Indexes, while capturing market returns, by targeting the top 50 per cent ESG rated equities within sectors and industries, while excluding severe controversies and industries such as alcohol, gambling, tobacco, and weapons.
  • BMO ESG Corporate Bond Index ETF (ESGB)
  • BMO ESG US Corporate Bond Hedged to CAD Index ETF (ESGF): These ETFs invest in investment grade corporate bond fixed income issuers that have the highest MSCI ESG Ratings.
  • BMO Global High Dividend Covered Call ETF (ZWG): This ETF is a yield solution investing in high dividend equities, utilizing some ESG integration and building off our existing covered call methodology.
  • BMO Premium Yield ETF (ZPAY, ZPAY.U, ZPAY.F): This ETF is a yield solution investing in a portfolio of large cap U.S. equities combined with derivative strategies to determine equity entry and exit strategies.

Learn more about responsible investing at BMO.

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