Align Values with Investment Goals Through ESG ETFs

As investors look for new ways to diversify their core portfolio positions, more are considering socially responsible exchange traded fund strategies to target environmental, social and governance, or ESG, principles to better align one’s investment goals with his or her values.

“Really, it’s a strand of responsible investing,” Martin Kremenstein, Senior Managing Director and Head of ETFs for NuShares by Nuveen, said at the Charles Schwab Impact Conference. “The idea that you would screen or score companies based on their environmental scores, their social scores – how they treat their workers; how they treat their customers, and in their governance – the board structure, the share class structure.”

Nuveen has launched a line of ETFs that screen companies of various market capitalization and asset categories for environmental, social and governance principles, include NuShares ESG Large-Cap Value ETF (BATS: NULV), NuShares ESG Large-Cap Growth ETF (BATS: NULG), NuShares ESG Mid-Cap Value ETF (BATS: NUMV), NuShares ESG Mid-Cap Growth ETF (BATS: NUMG) and NuShares ESG Small-Cap ETF (BATS: NUSC).

Nuveen is a part of TIA CREF, and the ESG ETFs draw upon the decades-long responsible investment expertise of TIAA Investments, according to a note. The underlying indices select components with considerations given to certain ESG criteria established by the sub-advisor, Teachers Advisors LLC, an affiliate of TIAA.