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Vanguard launches sustainable active funds

sustainable investingVanguard has launched a SustainableLife range, which includes four sustainable actively managed funds aimed at investors that want to achieve sustainable returns.

The funds include the Vanguard Sustainable Life 40-50% Equity fund, the Vanguard SustainableLife 60-70% Equity Fund and the Vanguard SustainableLife 70-90% Equity Fund.

All three funds will invest in global equities and bonds and are designed for investors looking to generate sustainable long-term growth. The funds carry an ongoing charges figure of 0.48%.

The Vanguard SustainableLife range will be managed by Wellington and will integrate ESG factors into its investment processes. 

The range will also focus on four sustainability principles including a commitment to net zero emissions by 2050 in alignment with the Paris agreement, exclusion of companies that may have a negative impact on society and the environment such as thermal coal, tar sands and tobacco, engagement with portfolio companies on material ESG issues, and the requirement for companies to follow good governance practices as a precondition for investment.

In addition to the SustainableLife range, Vanguard has also launched the Vanguard Global Sustainable Equity fund which will provide UK investors exposure to global companies while incorporating sustainable investment criteria.

The fund is also managed by Wellington and has an ongoing charge of 0.48%.

Fong Yee Chan, head of ESG strategy, Europe at Vanguard, said: “At Vanguard, we integrate ESG considerations into our investment processes and product design in three key ways. We engage with the companies in which we invest through our investment stewardship activities. We offer funds that allow investors to avoid certain ESG risks, and, thirdly, we allocate capital to companies based on certain sustainability criteria in our new actively managed funds, with the aim to outperform the market.”

As of October 31, 2021, Vanguard’s actively managed mutual funds and ETFs globally represented $1.8 trillion across traditional active equity, bond, quantitative and balanced assets.

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