24th July 2019 – Investors are increasingly looking for cash solutions that meaningfully consider environmental, social and governance (ESG) factors.
Following BlackRock’s successful US launch of the Liquid Environmentally Aware Fund (“LEAF”), the firm has now taken this concept global with the launch of the BlackRock Institutional Cash Series (ICS) LEAF series earlier this month. The ICS LEAF series are UCITS money market funds (MMFs) across three currencies – Euro, Sterling and US Dollar.
While BlackRock already has a fully integrated proprietary sustainable cash ratings model across all existing MMFs, the ICS LEAF series is the first UCITS fund range of its kind. The funds provide investors with same-day access to liquidity in Sterling, Euro and US Dollar through investment in securities issued or guaranteed by entities that meet the funds’ explicit Environmental and other characteristics, including Social and Governance factors (ESG).
As with US LEAF, BlackRock will commit 5% of the net revenue from management fees collected from the ICS LEAF series to purchase and subsequently retire carbon offsets.
Peter Loehnert, Head of International Cash Management at BlackRock says, “Sustainable investing is about smart investing and recognising that companies seeking to solve the world’s biggest challenges may be best positioned to grow. This launch provides greater choice to investors wishing to align their financial and ESG goals, and complements our ongoing efforts to integrate sustainability-related insights and data into our investment platform.”
Additional information about the fund series:
The ICS LEAF series considers ESG through its credit process and exclusionary screens, creating three important distinctions from BlackRock’s existing range of MMFs:
- Investments are made in a range of money market instruments whose issuer or guarantor has better-than-average performance in environmental practices (as determined by MSCI).
- At the time of purchase, issuers must not have been involved in violations of the UN Global Compact.
- The funds exclude investments in companies that earn a specified percentage (0-15%) of revenue from fossil fuels, thermal coal, nuclear energy, controversial weapons, tar/oil sands, civilian firearms and tobacco.