The biggest asset manager in the world, BlackRock (NYSE:BLK), has introduced its biggest equity exchange-traded fund (ETF) in Singapore to date. The $426 million iShares MSCI Asia ex-Japan Climate Action ETF was introduced on Monday with a target market of investors aiming to incorporate low-carbon transition goals into their portfolios. As part of the global transition to renewable energy and sustainable infrastructure, the ETF is focused on Asian businesses that are dedicated to lowering carbon emissions.
One of the biggest asset owners in Asia and a member of the Net Zero Asset Owners Alliance, Prudential PLC, an insurer with offices in London and Hong Kong, has provided the fund with anchor support. A group led by Singapore’s state investment firm Temasek Holdings and insurer Singapore Life made additional investments. Don Guo, group chief investment officer at Prudential, said that the company’s desire to support a systematic green transformation across all sectors is consistent with investing in the ETF.
The ETF follows the MSCI Asia ex-Japan Climate Action index, which contains the top 50% of businesses in each GICS sector based on metrics such science-based targets, climate risk management, and income from green businesses. It is the third climate-action ETF that iShares has introduced; in June, comparable funds were introduced in the United States and Japan.
Asia Pacific, according to Peter Loehnert, head of iShares and index investments for BlackRock APAC, is “the largest and fastest growing region for energy transition investment.” In order to implement low-carbon transition targets and harmonize portfolio allocations, he continued, iShares ETF demand is rising globally.
Gillian Tan, the assistant managing director of the Monetary Authority of Singapore, expressed her satisfaction with the ETF’s successful launch and noted that Singapore supports strategies that help the region’s issuers, asset owners, and investors meet their investment and risk management needs while also facilitating decarbonization.