Alternative Investments/ESG: HSBC Launches Two ESG Corporate Bond ETFs

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Both the ETFs are listed on the London Stock Exchange.

HSBC Asset Management debuts its first fixed income ETFs with an ESG skew. The HSBC Bloomberg EUR Corporate Sustainability Bond UCITS ETF (HEUC) and the HSBC Bloomberg USD Corporate Sustainability UCITS ETF (HUSC) carry a total expense ratio of 0.18%. (ETF Stream)

Olga de Tapia, global head of ETF sales at HSBC AM, said: “Our new fixed income ETF range takes a step beyond many existing sustainable fixed Income ETF products offering the investor a deeper shade of green in their investment portfolios.”

Erin Leonard, head of sustainability at HSBC AM, added: “Investors have a key part to play in the global transition to a net-zero economy by allocating capital away from firms with poor ESG practices and pressuring issuers to improve transparency.”

“These fixed income ETFs are a complementary extension of our existing equity ESG ETF fund range and an important part of the sustainability solution set for our clients.”

The funds are linked to the Bloomberg MSCI Euro Corporate SRI Carbon ESG-Weighted Index and Bloomberg Barclays MSCI USD Corporate SRI Carbon ESG-Weighted Index respectively, indices created through a partnership between Bloomberg and MSCI.

The indices’ parent universes are the Bloomberg Euro Aggregate Corporate Index and the Bloomberg US Aggregate Corporate Index. The indices consist of fixed-rate, investment-grade corporate bonds with more than one year remaining until maturity and at least €300 million outstanding for the Euro index or $300m for the US index.

According to HSBC, the indices deliver a 40% reduction in carbon emission intensity and an improvement in ESG score of more than 10% (EUR) and 15% (USD) relative to the parent indices.

Related Story: Vanguard Launches ESG Corporate Bonds ETF

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