Invesco MSCI Europe ESG Universal Screened UCITS ETF

Issuer: Invesco

Asset Class: Equity

TER: 16bps

Trading Currency: GBX

Pays Income: False

Listing Date: 17 Jun 2019

Ticker: ESGE

ISIN: IE00BJQRDL90

This fund offers a compelling investment proposition for those seeking to combine broad exposure to developed European equity markets with a robust Environmental, Social, and Governance (ESG) framework. The strategy is designed to track an index that provides access to a wide range of large and mid-capitalisation companies across 15 developed European countries. It employs a specific screening methodology to align the portfolio with sustainability principles, making it a suitable core holding for responsible investors.

The investment process begins with the broad MSCI Europe Index and then applies a series of values-based exclusions. Companies with significant business involvement in controversial sectors such as tobacco, controversial weapons, civilian firearms, thermal coal, and oil sands are removed. Additionally, the methodology screens out companies that are found to be in violation of the United Nations Global Compact principles. Following these exclusions, the remaining constituents are re-weighted to favour companies with stronger MSCI ESG ratings, thereby tilting the portfolio towards firms that demonstrate superior management of sustainability risks and opportunities.

By investing in this product, individuals gain exposure to the economic performance of leading European corporations in sectors like financials, healthcare, industrials, and consumer staples, while systematically reducing exposure to firms with poor ESG records and controversial business practices. The physical replication method ensures that the fund holds the underlying securities of the index, providing transparency and a direct investment in the constituent companies. This structure offers a straightforward and cost-effective way to build a diversified, responsible, and long-term European equity allocation.