Impact fintech business, iClima Earth, will launch what it says is the world’s first ESG UCITS exchange traded fund that provides exposure to companies offering products and services that enable CO2e avoidance solutions, and quantify that impact.The iClima Global Decarbonisation Enablers UCITS ETF (CLMA) will launch via the HANetf platform and will list on the London Stock Exchange in early December. CLMA will be the first ESG focused ETF issued by HANetf.
Gabriela Herculano, CEO of iClima Earth, says: “We are proud to announce the launch of the iClima Global Decarbonisation Enablers UCITS ETF to redefine climate change investments. This is the world’s first climate change UCITS ETF that provides exposure to companies offering products and services that enable CO2e avoidance, and quantifies the impact of those companies in meeting decarbonisation targets.
“The CLMA ETF is unique as it shifts the focus from the companies reducing their own emissions, to companies offering products and services that directly enable CO2e avoidance solutions, shining a spotlight on climate change innovators. iClima Earth estimates that the 151 companies in the iClima Global Decarbonisation Enablers Index can potentially avoid over 0.6 Gigatonnes of C02e in 2021 – the planet needs to avoid 4.26 Gigatonnes of new emissions in 2021 to reach the goal of limiting global warming to 1.5 degrees Celsius.
“Climate change and the transition to a low carbon economy are part of one of the largest megatrends of the 21st century. Green investments are being fuelled by regulatory actions such as the 2015 Paris Agreement as well as consumer preferences such as veganism and telepresence. To meet the goals of the Paris Agreement, investment into green investments needs to triple from current levels.
“There are many ‘green’ investment products already on the market that use complex ESG scores or focus on low-carbon companies doing less harm. However, the best way to reduce CO2e in the atmosphere is to find lower-emission alternatives to products and services, thereby ‘avoiding’ emission. In order for the world to reach net-zero by 2050 and have a chance of limiting global warming to 1.5 degrees Celsius above pre-industrial levels, large amounts of investment are necessary into new technologies and companies that will reduce and avoid carbon emissions. As a result, CLMA provides exposure to these companies across five subsectors including green energy, green transportation, water and waste improvements, decarbonisation enabling solutions and sustainable products. This includes high growth solutions like green hydrogen & fuel cells, distributed generation and electric vehicles.”
The ETF has a TER of 0.65% and tracks the iClima Global Decarbonisation Enablers Index, developed by iClima Earth. iClima Earth is a green fintech that creates investment products targeting companies that make impactful contributions to solving climate change.
The index was built using a tiered approach, meaning there is no over-exposure to large cap companies and it provides a balanced exposure to the key climate change solutions. The iClima Global Decarbonisation Enablers Index is up 64.5% over the last 12 months. Past performance is no guarantee of future performance.
Gabriela Herculano, CEO of iClima Earth, says: “Much has been said about the greenwashing that takes place across the investment industry. iClima not only changes the narrative of low carbon investments, but it alters the landscape of sustainable investments by quantifying impact. iClima has developed a methodology to quantify the CO2e avoidance potential of companies, a tangible measurement of impact in gigatons of CO2e. This is the first ETF to quantify the C02e impact it generates of potentially avoided emissions for each company in the index and the index as a whole.”
Nik Bienkowski, Co-CEO of HANetf, says: “HANetf is delighted that iClima Earth choose us to help them develop and launch the world’s first decarbonisation ETF and it will be the first of many on the HANetf platform. This is a unique ETF which leans in to the theme we talk about every day – limiting climate change. CLMA is a unique as it allows investors to make a real impact investment via an ETF. Some climate related ETFs have experienced exponential growth in the past 20 months and we expect this strong investor interest to continue.”