Franklin Templeton launches new emerging markets Paris aligned climate ETF

Franklin Templeton is pleased to announce the launch of its new Franklin MSCI Emerging Markets Paris Aligned Climate UCITS ETF within its Franklin Templeton ETF range. This sustainable ETF is classified as Article 8 under EU SFDR (Sustainable Finance Disclosure Regulation) and is the fourth Paris Aligned Climate ETF in the firm’s range, joining its China, Europe, and US funds. 

The new ETF will track the MSCI Emerging Markets Climate Paris Aligned Index, an EU Climate Benchmark Index, and will include large and mid-cap stocks across 24 emerging markets that are transitioning to a low-carbon economy. It is designed to support investors seeking to reduce exposure to physical climate risks whilst pursuing opportunities arising from the Paris Climate Agreement decarbonization goals. 

The Franklin MSCI Emerging Markets Paris Aligned Climate UCITS ETF will list on the Deutsche Börse  Xetra (XETRA) on 10^th March and Borsa Italiana and London Stock Exchange (LSE) on 14^th March. The fund will also be registered in Austria, Denmark, Finland, France, Germany, Ireland, Italy, Spain, Sweden, and the UK. 

“We are delighted to add this new ETF to our comprehensive suite of Paris Aligned Climate ETFs, which will help investors across Europe transition their assets in line with the Paris Accord. Providing access to distinct opportunities in emerging markets at a competitive fee, this ETF reduces climate risk exposure by investing in companies providing solutions to mitigate climate change as well as those improving their resilience to its consequences,  giving them a long-term competitive advantage. With global temperatures on the rise and massive investments needed to reduce carbon emissions amid today’s rising energy needs, emerging markets play an important role in achieving net zero. We believe this  new ETF can be a core sustainable investment solution for those looking to tap into this exciting growth  story”. 

Caroline Baron, Head of ETF Distribution, EMEA, Franklin Templeton.

Competitive fees  

With a total expense ratio (TER⁴) of 0.18%, a competitive fee for its respective category in Europe, the new  ETF will provide European investors with a cost-efficient, UCITS-compliant, equity exposure to large and mid-capitalization stocks in emerging markets pursuing decarbonization opportunities.  

“Just like our first  Paris Aligned ETFs that we launched in 2020, we have selected a key EM benchmark utilised by our clients,  MSCI Emerging Markets Index. With this ETF tracking the MSCI Emerging Market Climate Paris Aligned  Index, our investors will be able to align their core Emerging Market equity holdings to the Paris Climate  Agreement, and thus reduce their exposure to climate change risks as well as capture opportunities related  to low carbon transition. Furthermore, by partnering with MSCI’s leading carbon data specialists, this  sustainable ETF leverages the latest scientific research to provide a more insightful and robust assessment  of climate-related risks and opportunities, both today and in the future”.  

Rafaelle Lennox, Head of UCITS ETF Product Strategy, Franklin Templeton.

This ETF will be managed by Dina Ting, Head of Global Index Portfolio Management, and Lorenzo  Crosato, ETF Portfolio Manager, at Franklin Templeton, who have more than three decades of combined experience in the asset management industry and extensive track records in managing ETF strategies. 

“The EU Action Plan has three main objectives to drive the EU transition to a green economy,  namely - reorienting capital flows towards sustainable investment, mainstreaming sustainability into risk  management and fostering transparency and long-termism. This will require significant investment in  infrastructure, energy and technology. An estimated €180 billion⁵ of additional investment will be needed  each year to achieve 1.5ºC scenario. Our Article 8 ETF enables European investors to take part in this  significant opportunity and further deepens Franklin Templeton’s wide range of sustainable products.” 

<strong>Dina Ting, Head of Global Index Portfolio Management</strong>.

Franklin Templeton’s global ETF platform enables investors to pursue their desired outcomes through a range of active, factor-based, and passive ETFs. Supported by the strength and resources of one of the world’s largest asset managers, the global ETF platform has over $14 billion in assets under management globally as of 31 January 2023.