A new ETF issued by iShares has been tradable on Xetra and via Börse Frankfurt since Friday.
The iShares € Green Bond UCITS ETF EUR (Acc) is designed to offer investors access to green fixed-income corporate and government bonds denominated in euros. In addition to an investment grade rating, the bonds must have a minimum outstanding volume of EUR300 million.
The company writes that green bonds are debt instruments with a sustainable positive impact on the environment. They are issued to use their proceeds to finance climate and environmental projects to reduce greenhouse gases and promote a more climate-friendly economy. These include alternative and renewable energy, sustainable forestry and agriculture, sustainable water management, the promotion of environmentally conscious transport and infrastructure, and the reduction of waste and pollution.
Bonds from issuers that are classified as unsustainable according to ESG criteria or exceed certain caps on controversial activities are excluded from the fund.