DWS has expanded its US suite of Environmental, Social and Governance (ESG) ETFs with the launch of the Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (ACSG US) and Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (EMSG US) on the NYSE Arca.

Fiona Bassett, Global Co-Head of Passive Asset Management and Global Co-Head of Products.

The funds provide exposure to companies with high ESG ratings, as deemed by index provider MSCI, relative to their sector peers in international developed & emerging markets and emerging markets respectively.

MSCI’s rating methodology evaluates corporate governance, focusing on the most relevant ESG factors by industry and risk exposure, to identify ESG leaders and laggards within in each industry.

The underlying indices are free float-adjusted market capitalization weighted indexes designed to represent the performance of companies that have favourable ESG profiles compared to industry peers.

Overall the indices target a 50% sector representation versus the parent MSCI index.

“Although ESG investing has recently become a larger and fast-growing market segment, environmental, social and governance factors have been part of DWS’s core DNA for more than 20 years,” said Fiona Bassett, Global Co-Head of Passive Asset Management and Global Co-Head of Products.

She added, “Our goal is to provide investors with solutions that allow them to invest along with their values while also ensuring cost-efficient access to markets. Our newly launched Xtrackers suite of MSCI ESG Leaders ETFs employ a transparent approach in a market looking to define ESG standards and benchmarks.”

ACSG comes with a net expense ratio of 0.18%, while EMSG is a little more expensive at 0.20%.

The pair follow the launch of Xtrackers MSCI EAFE ESG Leaders Equity ETF (EASG US), which invests in high ESG rating companies located in developed markets outside the US and Canada.