Incorporating ESG Considerations in Australian Equities: A Strategic View

As evidence grows to support the benefits of environmental, social and governance (ESG) investing, investors are seeking clarity as to how these considerations can be incorporated in investment portfolios. In our paper, we analyse the S&P/ASX 200 ESG Index, an  ESG-enhanced strategy that applies exclusions and selects the strongest ESG companies while maintaining a broadly similar risk-return profile as the S&P/ASX 200 Index.

The Key Highlights are:

Why Six Park Selected E200

Six Park uses the SPDR® S&P®/ASX 200 ESG Fund (E200) in its sustainable investing portfolios, which were launched in December 2020.

When asked why Six Park selected E200, Pat Garrett, co-founder and co-CEO of the online investment management service, which works with financial advisers and professionals as well as consumers said sustainable investing was increasingly important to Six Park's partners and clients.

"At Six Park, we've seen accelerating demand from both consumers and financial advisers who serve them for an ESG offering that combines strong ESG characteristics without compromising a target risk/return profile.

"Our investment committee reviewed the marketplace of available ESG ETFs and we were pleased to select E200. SSGA's State Street Global Advisors’ and S&P's market track record and E200's transparency, alignment with Australia's leading share market index (ASX200) and low fees made this the optimal ETF for our ESG portfolios.

"We've been extremely pleased with the positive response from both consumers and our financial adviser partners with regard to E200 in meeting the demand for accessible, affordable and well diversified portfolios with an ESG tilt."