VALLEY FORGE, Pa., March 7, 2019 /PRNewswire/ -- Vanguard today
added to its current environmental, social, and governance (ESG)
fund offerings with Vanguard Global ESG Select Stock Fund. The new
active equity fund will be managed by Wellington Management Company
LLP and is expected to be available for investment in mid-2019.
"Vanguard's new Global ESG Select Stock Fund is taking a
distinctive approach to ESG investing, seeking long-term
outperformance through the selection of companies that integrate
leading ESG practices into their corporate strategies," said
Matthew Brancato, head of Vanguard's
Portfolio Review Group.
Marrying active management experience with ESG
expertise
While complementing Vanguard's existing
index-based ESG offerings that adhere to exclusionary screening
processes, the Global ESG Select Stock Fund will take a markedly
different investment approach by employing an active portfolio
integration strategy. Wellington Management will seek to outperform
the FTSE All-World Index, a global benchmark that covers a majority
of developed and emerging markets. In pursuit of this objective,
Wellington Management will identify and select approximately 40
companies that they believe demonstrate exemplary long-standing ESG
practices and have strong business fundamentals and management
teams with proven track records of good capital allocation
decisions for shareholders. The fund is expected to hold stocks
over an extended time horizon, resulting in low portfolio
turnover.
In addition to investment advisory responsibilities, Wellington
Management will be responsible for governance activities for the
fund. This will enable the fund managers to fully integrate proxy
voting and company engagements into the fund's investment
strategy.
Founded in 1928 and managing more than $1
trillion in assets, Wellington Management has a long and
successful investment management history, including management of
the nation's oldest balanced fund, the $100
billion Vanguard Wellington Fund. In addition, the firm has
the breadth and depth of investment resources to integrate ESG
considerations with its fundamental investment analysis. The firm
has managed ESG-related investment strategies for more than ten
years and currently manages nine dedicated ESG strategies.
Wellington is Vanguard's largest
and longest-serving external advisory partner, managing more than
$336 billion on behalf of Vanguard
across a wide variety of equity and bond mandates.
The portfolio managers for Vanguard Global ESG Select Stock Fund
each have more than 20 years of investment management
expertise:
- Mark D. Mandel, CFA, serves as
Wellington's vice chair, senior
managing director, partner, and equity portfolio manager. In
addition to Mr. Mandel's investment experience, he has an extensive
background in research and analysis. Mr. Mandel previously served
as Wellington's director of global
industry research and oversaw a team that follows thousands of
stocks and directly manages investments in diversified mandates,
sector portfolios, and hedge funds.
- Yolanda C. Courtines, CFA,
serves as Wellington's senior
managing director, partner, and equity portfolio manager. In
addition to her investment and ESG research experience, Ms.
Courtines brings deep international investment expertise to
Wellington's team, specializing in
international finance with a particular focus on European and Latin
American banks. Prior to joining Wellington, Ms. Courtines worked for JPMorgan
Chase, SG Cowen, Oppenheimer, and the World Bank.
The Global ESG Select Stock Fund is expected to be among the
lowest-cost in the active ESG fund category with expense ratios of
0.45% and 0.55% for Admiral and Investor shares, respectively. By
comparison, the average asset-weighted expense ratio of actively
managed funds labeled as socially conscious by Morningstar is
0.69%.
The fund is designed for investors with balanced, diversified
portfolios who wish to invest in companies with leading ESG
practices and strong business fundamentals, as identified by
Wellington Management. At times, the fund may hold companies that
would be omitted by some exclusionary ESG strategies, so this
strategy may not be ideal for investors seeking to avoid investing
in particular sectors or companies involved in activities that are
at odds with their individual values.
New fund complements existing low-cost ESG
offerings
Vanguard currently offers three index-based,
U.S.-domiciled options for socially conscious investors seeking
broad, low-cost exposure to U.S. and international markets.
- Vanguard FTSE Social Index Fund (VFTAX), introduced in 2000,
seeks to track the performance of large-and-mid-cap U.S. stocks
screened for certain social and environmental criteria.
- Vanguard ESG International Stock ETF (VSGX), launched in 2018,
seeks to track the performance of non-U.S., large-, mid-, and
small-cap companies screened for certain environmental, social, and
corporate governance criteria.
- Vanguard ESG U.S. Stock ETF (ESGV), launched in 2018, seeks to
track the performance of large-, mid-, and small-cap U.S. companies
screened for certain environmental, social, and corporate
governance criteria.
ESG resources for investors
To help investors better
understand ESG investing, Vanguard offers "ESG, SRI and impact
investing: A primer for decision-making," which outlines a
practical framework for making informed decisions. The guide helps
investors establish specific goals, evaluate potential options, and
decide on an ESG approach based on their personal criteria and
trade-off considerations.
About Vanguard
Vanguard is one of the world's largest investment management
companies. As of January 31, 2019,
Vanguard managed $5.2 trillion in
global assets. The firm, headquartered in Valley Forge, Pennsylvania, offers 415 funds
to its more than 20 million investors worldwide. For more
information, visit vanguard.com.
Asset figures as of December 31,
2018 unless otherwise noted.
For more information about Vanguard funds, visit
vanguard.com/fund prospectus to obtain a prospectus or, if
available, a summary prospectus. Investment objectives, risks,
charges, expenses, and other important information are contained in
the prospectus; read and consider it carefully before
investing.
Vanguard ETF Shares are not redeemable with the issuing
Fund other than in very large aggregations worth millions of
dollars. Instead, investors must buy and sell Vanguard ETF Shares
in the secondary market and hold those shares in a brokerage
account. In doing so, the investor may incur brokerage commissions
and may pay more than net asset value when buying and receive
less than net asset value when selling.
All investing is subject to risk, including the possible loss
of the money you invest. Diversification does not ensure a profit
or protect against a loss. Investments in securities issued by
non-U.S. companies are subject to risks including country/regional
risk and currency risk. These are especially high in emerging
markets. Funds that concentrate on a relatively narrow market
sector face the risk of higher share-price volatility. Prices of
small- and mid-capitalization stocks often fluctuate more than
those of large-company stocks.
U.S. Patent Nos. 6,879,964; 7,337,138; 7,720,749; 7,925,573;
8,090,646; and 8,417,623.
Vanguard Marketing Corporation, Distributor.
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