GSAM today announced the launch of JUST, an ETF that seeks to provide broad exposure to US large cap equities, with a focus on companies that demonstrate just business behavior, as measured by JUST Capital.
The ETF seeks to track the JUST US Large Cap Diversified Index (the Index), constructed by JUST Capital.
JUST Capital is an independent nonprofit that uses data and markets to promote positive change in corporate behaviour. To create its rankings and the Index, JUST Capital conducts an annual survey of the American public and then analyses 120,000 data points across 85 unique metrics to score companies based on how they perform on the key issues prioritised by the public.
The Index is designed to provide the broad market exposure of the Russell 1000 Index, while featuring only companies with above-average scores across all major social, environmental, and governance issues critical to the American people.
Historically, companies in the Index on average pay better, create more jobs, pay fewer fines, give twice as much to charity, emit less greenhouse gas, and have higher return on equity, compared with the rest of the Russell 1000.
“JUST Capital’s association with GSAM is grounded in a shared belief that capitalism should be a positive force for change and that its future will be driven by a new definition of corporate success that is aligned with the values and priorities of the public,” says Paul Tudor Jones, co-Founder and Chairman of JUST Capital. “We have the unique opportunity to help shift resources toward companies driving change on the country’s most intractable social, environmental, and economic problems.”
Companies are ranked by their overall score, and the top 50 per cent by industry are selected and weighted by market cap, arriving at the final index composition. Instead of a niche or single-issue approach, companies are ranked based on a broad range of categories from worker issues – such as providing a living wage and workplace safety – to customer concerns – such as privacy protection and truthful advertising – to environmental impacts – such as minimising pollution and resource efficiency.
“JUST is an important financial product — it specifically promotes corporate practices and policies that society values,” says Timothy J O’Neill, co-head of Goldman Sachs’ Investment Management Division. “This focus allows investment to flow toward a more sustainable and equitable future, while seeking to generate attractive returns for investors.”