Franklin Templeton launches new MSCI World Catholic Principles ETF for European investors

Article 8 compliant ETF provides access to highly rated ESG companies with lower exposure to carbon emissions relative to the broader MSCI World Index and in alignment with Catholic principles

London, 24 April 2024 – Franklin Templeton¹ is pleased to announce the launch of its new Franklin MSCI World Catholic Principles UCITS ETF². This Article 8³ compliant offering brings the total number of Article 8³ compliant ETFs to 12 in the Franklin Templeton ETF range, which has over half of its funds classified as Article 8 or 9 compliant.

The investment objective of this new global equity index-tracking ETF is to provide exposure to large and mid-cap stocks of companies considered environmentally and socially responsible in developed market countries. The ETF tracks the performance of the MSCI World Select Catholic Principles ESG Universal and Low Carbon Index⁴.

Focusing on companies with lower carbon exposure and higher Environmental, Social and Governance (ESG) ratings, index holdings must have a minimum of a ‘BB’ ESG Rating from MSCI ESG Ratings. The index excludes companies involved in controversial businesses, such as civilian firearms, nuclear weapons, and controversial and conventional weapons. Investment in businesses involved in gambling, tobacco, and thermal coal is significantly restricted and based on revenue generated from these activities. The index also has three additional exclusions, which consist of abortion and contraceptives, animal testing and stem cells research to align with Catholic values. This results in a current overall MSCI ESG Rating of AA ⁵, highlighting the strength of the ETF’s sustainability profile. Over 65%⁵ of stocks in the portfolio are currently achieving an MSCI ESG Rating of between A to AAA.

Caroline Baron, Head of ETF Distribution, EMEA, Franklin Templeton added: “Following the launch of the Franklin Catholic Principles Emerging Markets Sovereign Debt UCITS ETF two years ago and further to client interests, we are delighted to expand our offering of values-based products and introduce this new MSCI World Catholic Principles UCITS ETF to European investors. With this new fund we wanted to offer investors an ESG-focused global equity strategy within an ETF structure that incorporates specific Catholic values but also provides a core equity article 8 compliant solution.”  

The Franklin MSCI World Catholic Principles UCITS ETF² will list on the Deutsche Börse Xetra (XETRA) on 25 April, London Stock Exchange (LSE) on 26 April and Borsa Italiana on 9 May. The ETF is registered in Austria, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Spain, Sweden and the United Kingdom.

Competitive fees

The ETF will provide European investors with cost-efficient, UCITS-compliant, developed market equity exposure aligned with Catholic principles and offers one of the lowest total expense ratios (TER⁶) at 0.27% in Europe for its respective category.

Rafaelle Lennox, Head of UCITS ETF Product Strategy, Franklin Templeton added: “We are pleased to bring this tailor-made solution to investors. The MSCI World Select Catholic Principles ESG Universal and Low Carbon Index was created from a partnership between Franklin Templeton, MSCI and ethical advisor Nummus.Info to offer investors real customisation backed by the scale and resources of our firm. Investors can now participate in the performance of sustainable developed world equities that align with Catholic principles in one simple ETF.”  

This ETF will be managed by Dina Ting, Head of Global Index Portfolio Management, and Lorenzo Crosato, ETF Portfolio Manager, Franklin Templeton, who have more than three decades of combined experience in the asset management industry and extensive track records in managing ETF strategies.

Franklin Templeton’s global ETF platform enables investors to pursue their desired outcomes through a range of active, factor-based and passive ETFs. Supported by the strength and resources of one of the world’s largest asset managers, the global ETF platform has over $23 billion in assets under management globally as of 31 March 2024.

For more information on the Franklin Templeton ETF range please visit: www.franklintempleton.co.uk.

- ENDS –

		Stock Exchanges
		Xetra Ticker	LSE Ticker	Borsa Italiana Ticker
Fund Name	ISIN	EUR	USD	EUR
Franklin MSCI World Catholic Principles UCITS ETF	IE000AZOUN82	FLXA	FIDE	FAITH

 

Contacts:

Alina Ulkina Corporate Communications Manager Franklin Templeton Tel: +44 790 090 0184 Email: [email protected]

Dorine Johnson Head of Corporate Communications EMEA Franklin Templeton Tel: + 44 207 073 8538 Email: [email protected]

Notes to Editors:

This is a marketing communication. Please refer to the prospectus of the UCITS and to the KIID/KID before making any final investment decisions.

1. Franklin Resources, Inc. [NYSE:BEN] is a global investment management organization with subsidiaries operating as Franklin Templeton and serving clients in over 150 countries. Franklin Templeton’s mission is to help clients achieve better outcomes through investment management expertise, wealth management and technology solutions. Through its specialist investment managers, the company offers specialization on a global scale, bringing extensive capabilities in fixed income, equity, alternatives and multi-asset solutions. With more than 1,500 investment professionals, and offices in major financial markets around the world, the California-based company has over 75 years of investment experience and over $1.6 trillion in assets under management as of 31 March 2024. For more information, please visit www.franklintempleton.co.uk and follow us on LinkedIn, Twitter and Facebook.
2. Franklin MSCI World Catholic Principles UCITS ETF is a sub-fund of the Franklin Templeton ICAV, an Irish Collective Asset-managed Vehicle, incorporated under the laws of Ireland.

The views expressed are those of the investment manager and the comments, opinions and analyses are rendered as of the publication date and may change without notice. The information provided in this material is not intended as complete analysis of every material fact regarding any country, region or market.

An investment in Franklin Templeton ICAV range entails risks, which are described in the prospectus, its supplements and in the relevant Key Investor Information Document. The Fund's documents are available in English, German and French from your local website. In addition, a Summary of Investor Rights is available from www.franklintempleton.lu/investor-rights. Franklin Templeton ICAV is notified for marketing in multiple EU Member States under the UCITS Directive. Franklin Templeton ICAV can terminate such notifications for any share class and/or sub-fund at any time by using the process contained in Article 93a of the UCITS Directive.

The value of shares in the fund and income received from it can go down as well as up and investors may not get back the full amount invested. Past performance is not an indicator or a guarantee of future performance. Performance may also be affected by currency fluctuations. Currency fluctuations may affect the value of overseas investments. There is no guarantee that the fund will meet its objective. Significant fund risks include: Counterparty risk: the risk of failure of financial institutions or agents (when serving as a counterparty to financial contracts) to perform their obligations, whether due to insolvency, bankruptcy or other causes. Derivative Instruments risk: the risk of loss in an instrument where a small change in the value of the underlying investment may have a larger impact on the value of such instrument. Derivatives may involve additional liquidity, credit and counterparty risks. Foreign Currency risk: the risk of loss arising from exchange-rate fluctuations or due to exchange control regulations. Index related risk: the risk that quantitative techniques used in creating the Index the Fund seeks to track do not generate the intended result, or that the portfolio of the Fund deviates from its Index composition or performance. Secondary market trading risk: the risk that the shares purchased on the secondary market cannot usually be sold directly back to the Fund and that investors may therefore pay more than the NAV per share when buying shares or may receive less than the current NAV per Share when selling shares. For full details of all the risks applicable, please refer to the "Risk Considerations" section of the current prospectus of Franklin Templeton ICAV.

Franklin Templeton ICAV UCITS ETFs (domiciled outside of the U.S. or Canada) may not be directly or indirectly offered or sold to residents of the United States of America or Canada. ETFs trade like stocks, fluctuate in market value and may trade at prices above or below their net asset value. Brokerage commissions and ETF expenses will reduce returns.

3. This fund has been classified as Article 8 under the Regulation on sustainability related disclosures in the financial services sector (EU) 2019/2088. These are Funds which have an ESG integration approach and, in addition, have binding environmental and/or social characteristics in their investment process. Further information in relation to the sustainability-related aspects of the Fund can be found at franklinresources.com/countries. Please review all of the fund's objectives and characteristics before investing.
4. The Index aims to represent the performance of companies that have lower carbon exposure and higher Environmental, Social and Governance ("ESG") performance relative to the Parent Index. The Index is a systematic, rules-based proprietary index that is owned and calculated by the Index Provider. It is comprised of approximately 800 stocks selected from the Parent Index, which is comprised of approximately 1500 stocks.  The Index uses MSCI ESG ratings to identify companies that have demonstrated an ability to manage their ESG risks and opportunities. The Index also excludes companies that are involved in controversial businesses or that are considered to have negative environmental or social impacts. It is currently anticipated that the tracking error of the Fund will be in the range of 0.5% under normal market conditions, where the tracking error is defined as the standard deviation of the delivered excess returns over an annual period.
5. Data as of 31 March 2024.
6. The charges are the fees the fund charges to investors to cover the costs of running the Fund. Additional costs, including transaction fees, will also be incurred. These costs are paid out by the Fund, which will impact on the overall return of the Fund. Fund charges will be incurred in multiple currencies, meaning that payments may increase or decrease as a result of currency exchange fluctuations.

This press release is intended to be of general interest only and does not constitute professional advice. Franklin Templeton and its management groups have exercised professional care and diligence in the collection and processing of the information in this press release. Franklin Templeton makes no representations or warranties with respect to the accuracy of this document. Franklin Templeton shall not be liable to any user of this report or to any other person or entity for the inaccuracy of information contained in this press release or for any errors or omissions in its contents, regardless of the cause of such inaccuracy, error or omission.

Any research and analysis contained in this document has been procured by Franklin Templeton for its own purposes.

Please consult your financial advisor before deciding to invest.

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