It's been one year since Impact Shares launched an exchange-traded fund, in collaboration with the United Nations, intended to support the world body's sustainable development goals. The tiny fund, which trades on NYSE Arca as SDGA, has just $1 million in assets and trading up slightly since it opened last year.
"It's in collaboration with the United Nations Capital Development Fund (UNCDF), who's entire goal is to attract capital to the 47 least-developed countries," Ethan Powell, the CEO of Impact Shares, told Cheddar earlier this week. Impact Shares is a non-profit ETF sponsor supported by the Rockefeller Foundation.
"This fund, and the [United Nations'] Sustainable Development Goals, is really a path toward everyone's ability to contribute to the solution, instead of the problem," he said. The UN's Sustainable Development Goals outline the international organization's aspirations to eradicate poverty and hunger, transition the world economy to clean energy, and protect the ocean, among other humanitarian objectives. Net advisory profits from the fund's management fees are donated to UNDCF.
The fund's holdings include Nestle, Microsoft, Disney, and Bank of America.
"What we're trying to identify are those large multinationals that are humanely engaging emerging economies," explained Powell.
He said the find mainly sees demand from ultra-high net worth individuals, institutions, and pensions and endowments "that understand their constituents want their capital to be aligned with their social mission."
"It's arguably the most important issues we're facing globally, and frankly one where the U.S. could contribute probably the most dramatically to," he said. "I think that the challenge ends up being [that] politicians aren't necessarily inclined to have difficult conversations. We, as a consuming public, don't really want to hear that."
But, he says, "we aren't fossil fuel-free" — an "intentional" choice.
"What we do try to do is promote engagement between the U.N. and energy companies to promote more sustainable, green-oriented energy options," Powell said.