Rize ETF launches LIFE, an environmental impact ETF
Newly acquired by AssetCo, thematic specialist ETF issuer Rize ETF has launched a new ETF targeting environmental sustainability, the Rize Environmental Impact 100 UCITS ETF (LIFE).
The firm describes the fund as the first ETF of its kind in Europe, and is on the London Stock Exchange (LSE) trading under the tickers LIFE (USD) and LVNG (GBP). In addition to the LSE, the fund will also be listed on the Deutsche Börse Xetra, Borsa Italiana and the SIX Swiss Exchange.
The fund is classified as an Article 9 fund under SFDR and carries an OCF of 0.55 per cent. The new launch brings Rize ETF’s total ETF count to five, complementing existing thematic offerings on Sustainable Future of Food (FOOD/FOGB), Cybersecurity and Data Privacy (CYBR/CYBP), Medical Cannabis and Life Sciences (FLWR/FLWG) and Education Tech and Digital Learning (LERN/LERP).
Rize ETF writes that the LIFE fund is designed to provide investors with exposure to the top 100 most impactful companies developing and applying innovative solutions to tackle the world’s most pressing climatic and environmental challenges.
These include companies involved in clean water, EVs, renewables and hydrogen, energy efficiency and waste, plus those working towards the circular economy and nature-based solutions holding the promise of a greener future. LIFE is purpose-built in partnership with Sustainable Market Strategies (SMS), an independent specialist in sustainable investing, ESG intelligence and climate policy.
The SMS team is comprised of a world-class team of experts across capital markets, sustainable investing, economics, public policy and academic research. The SMS team also includes managing partner, Félix A. Boudreault, an engineer by background and the former Director of International Climate Change Negotiation at Environment and Climate Change Canada (a department of the Government of Canada) who led Canada’s negotiating team in the lead up to the Paris Agreement in 2013 and 2014. Rize ETF and SMS entered into a strategic partnership in late 2020 to design and implement one of the world’s first environmentally-focused impact investment strategies aligned to the six environmental objectives set out in the EU Taxonomy for Sustainable Activities (“EU Taxonomy”).
The EU Taxonomy forms a critical part of the European Sustainable Finance Disclosure Regulation, more commonly referred to as the SFDR. From this ambition, LIFE was born. As part of its investment framework, LIFE employs a proprietary classification methodology that seeks to deconstruct the six environmental objectives into a series of ‘high impact’ investment sub-sectors that the fund invests in. The sub-sector taxonomy is fluid and built to be dynamic over time as the European Commission incrementally builds out their complete EU Taxonomy and unveils the rest of the broader SFDR regulatory framework. Foxberry Limited (“Foxberry”) has been engaged to administer the index replicated by the ETF.
Rahul Bhushan, Co-Founder and Director of Rize ETF explains: “What we have created here in partnership with SMS is an investment strategy and ETF that is purpose-built for taxonomy-aligned portfolios. As allocators of capital, we have the choice today to align ourselves with public policy objectives. The EU Taxonomy is incredibly thorough, and provides investors and companies with definitions around the type of economic activities that should be considered environmentally sustainable. We believe this is a hugely constructive and positive first step for the asset management industry as we try to phase out greenwashing and vacuous value-signalling. Crucially it also offers much greater clarity to companies as they seek to make their own green transition. LIFE is a simple and transparent way for investors to align themselves to the six environmental objectives set out in the EU Taxonomy with the knowledge that their capital is being used to back the technologies and solutions that will pave the way to a greener future.”
Stuart Forbes, Co-Founder and Director of Rize ETF adds: “Our planet is under threat like never before. Temperatures are rising, rainfall patterns are shifting and sea ice cover is retreating. Oceans are acidifying, soils are degrading and droughts and floods are now commonplace. Exploitation and degradation of Earth’s remaining natural resources, habitats and biodiversity continues. We need to take collective action now. That requires us to put our hands into our NEW RELEASE pockets and vote with our capital. The Rize Environmental Impact 100 UCITS ETF is designed to give investors exposure to the top 100 most impactful companies in the environmental universe while also providing them the comfort that their capital is being geared towards maximising environmental sustainability in each of our relevant subsectors.”
Félix A. Boudreault, Managing Partner at Sustainable Market Strategies comments: “We are very pleased to be working with Rize ETF to bring our extensive experience in environmental public policy and sustainable investment research to bear in this ground-breaking initiative in Europe. With the proliferation of greenwashing that unfortunately pervades our industry, we were together determined to develop a robust investible solution that cut through the noise. We have created an ETF that does not just focus on carbon avoidance, or carbon mitigation, but one which seeks to identify the companies that are leaders and innovators in their respective environmental sub-sectors as per the EU Taxonomy. We are investing across the most cutting-edge technologies and solutions across clean water, EVs, renewables and hydrogen, energy efficiency, waste and the circular economy and nature-based solutions. We are excited about the strategy and look forward to having conversations with European investors.”