ImpactAlpha, October 2 – Veganism was bound to hit the mainstream financial markets, given all the private capital investing in a meat-free future. (Or, at least, a reared-animal meat-free future. There’s that lab-grown trend, after all.)
Investment firm Beyond Investing launched last year to build a pipeline of public and private investments that are vegan-friendly. Its public markets arm, Beyond Advisors, has registered a vegan exchange traded fund (ETF) with the SEC built around companies that do not participate in “business activity that harms animals.” The ETF will trade under the ticker VEGAN.
In May, Beyond Advisors launched an index around which its ETF will be built. The U.S. Vegan Climate Index is based off of German index provider Solactive’s U.S. Large Cap Index, and screens out companies based on companies involved in: animal testing, animal-derived products, animals used for sport or entertainment, fossil fuels, military and defense, tobacco, and other environmental and human rights issues. In all, these screens eliminates 41% of the index.
“For the first time that proportion of the US stock market whose business models harm animals and the environment can be identified,” Beyond Advisors’ Claire Smith said. Beyond Advisors claims the fund will “avoid funding the slaughter of 13 animals a year for every $1,000 invested.”
An estimate from Bloomberg pegs the environmental, social and governance-focused ETF market at $6 billion, within a $3.5 trillion total ETF market. ESG funds have grown 500% in the past five years. Impact Shares alone has launched three impact-focused ETFs this year, supporting gender equity, minorities and people of color, and the U.N. Sustainable Development Goals.