Legg Mason, ClearBridge Bring Active Touch to ESG ETF Investments

“We thought this was an investment process for the long-term; it is not just a values investment,” McQuillen told ETF Trends in a call.

McQuillen pointed out that they employ a team of sector analysts that undergo thorough financial research, along with the ESG research, to screen and select component holdings.

The ClearBridge Large Cap Growth ESG ETF will try to generate long-term capital appreciation through investing in large-cap companies with the potential for high future earnings growth, along with strong ESG characteristics. The managers will target companies with sustainable competitive advantages based on differentiated business models, high returns on capital, strong balance sheets and capable management teams that allocate capital in an efficient manner.

The ClearBridge Dividend Strategy ESG ETF will try to generate dividend income, growth of dividend income and long-term capital appreciation. The management team will leverage fundamental analysis to select a diversified portfolio of leading companies with long histories of paying and raising dividends, along with strong ESG characteristics.

The ESG characteristics are based on the manager’s proprietary research and twenty-five year history of managing ESG investment strategies. Determining factors when evaluating ESG characteristics include innovative workplace policies, employee benefits and programs; environmental management system strength, eco-efficiency and life-cycle analysis; community involvement, strategic philanthropy and reputation management; and strong corporate governance and independence of the board, among others.

For more information on new fund products, visit our new ETFs category.