BNP Paribas Asset Management (BNPP AM) announced the launch of two new ESG-integrated exchange-traded funds, BNP Paribas Easy Sustainable Japan UCITS ETF and BNP Paribas Easy Sustainable US UCITS ETF.

The new funds form part of BNPP AM’s Easy Active Beta ETF range, its suite of funds that combine a traditional indexing approach with active integration of the firm’s proprietary ESG methodology.

According to BNP Paribas AM, the new ETFs are targeted at investors seeking a more focused approach to sustainability, with the ability to adapt quickly to evolving regulations and label criteria, while keeping a low tracking error. Key features of the Active Beta ETFs include beta exposure to mainstream benchmarks with minimized tracking error, with sustainability features including utilization of the BNPP AM independent ESG scoring methodology, integration of its ESG approach and of Paris-aligned Benchmarks (PAB) exclusions, and a carbon footprint 50% lower than their starting universe.

Lorraine Sereyjol-Garros, Global Head of Development for ETFs & Index Funds at BNPP AM said:

“Offering ETFs that combine a recognised ESG approach, high sustainable investment and ambitious decarbonisation target, while providing the benefits of index-based investing, including a reasonable tracking error, will answer the increasing demand from institutional clients and distributors to integrate ESG factors in their portfolio.”

The benchmarks for the BNP Paribas Easy Sustainable Japan UCITS ETF and BNP Paribas Easy Sustainable US UCITS ETF include the MSCI Japan Net Total Return (NTR) Index and the S&P 500 NTR Index, respectively. Both funds target a tracking error below 2% and are classified as Article 8 under the SFDR regulation. The funds are listed on Euronext Paris.

Marie-Sophie Pastant, Head of Index & ETF Strategies – Portfolio Management at BNPP AM said:

“These two new launches are the natural next step of our Active Beta range. Our aim is to develop a new segment of equity funds aiming to be as close as possible to mainstream benchmarks, with ex ante TE between 1% to 1.5%, while integrating solid ESG features developed by BNPP AM. Those funds will decarbonate by 50% their starting universe.”