Vanguard Charitable has launched three new environmental, social, and governance (ESG) investment options, using index exchange-traded funds (ETFs) opened earlier this year by The Vanguard Group.
Beginning 4 October 2018, Vanguard Charitable donors will be able to recommend investment of charitable assets into: ESG US Stock; ESG International Stock; and ESG Global Stock, a proprietary 70/30 blend of US and international.
Per Vanguard, which launched the ESG ETFs earlier this year and opened them to investors mid-September, Vanguard ESG U.SStock ETF and Vanguard ESG International ETF will seek to track two broad-based FTSE Russell indexes, constructed to offer broad large-, mid-, and small-capitalisation equity exposure, while excluding companies involved in the production of alcohol, tobacco, gambling, adult entertainment, weapons, fossil fuels, and nuclear power.
The construction methodology also excludes companies that do not meet certain diversity criteria, as well as the labour, human rights, anti-corruption, and environmental standards defined by the United Nations Global Compact Principles.
“Our donors are increasingly interested in aligning their charitable investment strategy with their personal values,” says Jane Greenfield, president of Vanguard Charitable. “We are thrilled to offer indexed Vanguard ESG ETFs that provide donors with access to the broader market through an EGS screen.”
The new investment options all consist of underlying Vanguard mutual funds, with direct pass-through of Vanguard’s renowned low expense ratios. The company announced earlier this summer it is retiring its Gift Preservation investment option.
Vanguard Charitable is also rolling out new investment positioning, grouping options into Portfolio Solutions, Portfolio Builders, and Values-Driven Investments, as a way to guide donors at all levels of investment acumen to choose the best options for their philanthropic needs.
“Our primary objective is to help our donors increase their impact on the causes and missions they care about most. By restructuring and expanding our investment options, we’re ensuring our donors have access to a diverse range of asset classes and professionally rebalanced funds, all at a low cost, to construct the right charitable portfolio for their specific giving goals,” said Jane.
