MSCI and BlackRock to partner on controversial weapons index funds as MSCI unveils new range

Index house unveils its revised ESG benchmarks.

MSCI, the global index house, and BlackRock, the world’s biggest asset manager, will partner next month for the launch of a series of new index funds that disbar investments in controversial weapons. The move comes as MSCI unveils a newly branded range of 25 ESG indices that update and revise the 23 KLD indices that MSCI acquired as part of its $1.55bn acquisition of RiskMetrics last year. The passive funds will be run by Blackrock and be based on a new range of nine MSCI Global ex Controversial Weapons indices. These include country and regional benchmarks that avoid investments in cluster bombs, landmines, chemical, biological, and depleted uranium weapons. A number of regulatory and legislative initiatives in Europe and Australia are considering banning investments in such weapons, many of which are already covered by global treaties to curb their production. Amy Schioldager, Managing Director and Global Head of Index Equity Portfolio Management atBlackRock, said: “We are pleased to be partnering with MSCI in the July launch of a new series of BlackRock index funds that will be based on the new ex-controversial weapons indexes.” As part of the index launch, MSCI has also created the MSCI World Socially Responsible Index and four other new best-in-class regional and country indices based on companies with the highest MSCI ESG research ratings. The indices also exclude companies with investments in tobacco, nuclear power and GMOs. In addition, MSCI has added eleven new regional and country indices to its MSCI Global ESG Indices series. These cover the highest-rated companies in industry sectors and are designed to track closely to their parent MSCI indices. Remy Briand, Global Head of Index and ESG Research at MSCI, said: “These indices broaden and deepen our ESG index line-up, enabling both asset owners and asset managers to implement a growing range of ESG strategies.”
Link to MSCI ESG indices