L&G US Equity (Responsible Exclusions) UCITS ETF

Issuer: L&G ETFs

Asset Class: Equity

TER: 12bps

Trading Currency: GBX

Pays Income: False

Listing Date: 10 Dec 2019

Ticker: RIUG

ISIN: IE00BKLWY790

This investment vehicle offers targeted exposure to the US equity market through a sophisticated, climate-focused lens. It is specifically designed for investors who wish to align their capital with the ambitious goals of the Paris Agreement. The strategy invests in a diversified portfolio of large and mid-capitalization US companies that demonstrate strong environmental, social, and governance (ESG) characteristics. More importantly, the fund's construction methodology is explicitly geared towards significant decarbonization. By adhering to the strict criteria of a Paris-Aligned Benchmark (PAB), the portfolio aims to substantially reduce its carbon footprint compared to a traditional market-cap-weighted US index, providing a core holding for those looking to mitigate climate-related risks within their equity allocation.

The underlying index employs a rigorous, rules-based process to achieve its climate objectives. It begins by excluding companies involved in controversial sectors such as fossil fuels, tobacco, and controversial weapons, as well as firms that violate the principles of the UN Global Compact. Following these exclusions, the remaining securities are re-weighted to achieve a 50% reduction in carbon intensity versus the parent universe and to maintain a 7% year-on-year decarbonization pathway. This forward-looking approach ensures the portfolio is positioned to benefit from the transition to a low-carbon economy. The fund's physical replication method means it holds the actual stocks in the index, offering direct ownership of these climate-aligned businesses.

By integrating these stringent climate metrics, the product serves as a powerful tool for sustainable investing. It allows investors to gain broad exposure to the world's largest equity market while actively supporting the transition towards a more sustainable future. This makes it an ideal component for portfolios seeking not only financial returns but also a measurable, positive environmental impact. The strategy moves beyond basic ESG screening to offer a quantifiable commitment to addressing climate change, making it suitable for investors who prioritize both performance and principles.