12 July 2021
by Andrea Gaini

First ESG-focused Gold Mining ETF to launch on London Stock Exchange

Europe’s first Environmental, Social and Governance (ESG)-focused gold mining Exchange Traded Fund (ETF) is launching on the London Stock Exchange in July 2021.

© Jason Briscoe/Unsplash

The AuAg ESG Gold Mining UCITS ETF (ticker: ESGO) will list on London Stock Exchange in July and will be passported for sale across Europe. The fund has been created in partnership with Sweden based AuAg Funds, a boutique brand with a strong focus on precious metals & green-tech elements and has been developed on the HANetf white-label ETF platform.

It is hope it will give ESG-focused investors a unique opportunity to participate in the gold mining sector. ESGO seeks to offer exposure to an equal-weighted basket of 25 ESG screened gold miners.

The ETF tracks the Solactive AuAg Gold Mining Index, which ranks gold miners for ESG characteristics and excludes all but the 25 best-in-class ESG Risk companies in the sector. Independent ESG screening is provided by Sustainalytics, which has more than 25 years of experience in delivering ESG-related research. The ETF is classified as Article 8 under the Sustainable Finance Disclosure Regulation (SFDR).

The fund is equally weighted, with each holding having an allocation of 4%. The equal-weighted design helps to avoid concentration risks in larger gold miners. The possible underweighting of a few dominant mega-companies may also provide a beneficial return profile for the AuAg ESG Gold Mining UCITS ETF in a bull market for gold and gold miners. The fund’s total expense ratio is 0.60%.

Impact investing within the industry promotes environmentally friendly miners to be on the grid, build solar farms on-site, use fuel-cell mining trucks, and restore sites post-project, leaving reusable infrastructure (roads, water, electricity) for other projects. The mining sector’s role in greenhouse gas emission means ESG criteria need to be monitored, which is the focus of the Solactive AuAg ESG Gold Mining Index.

Eric Strand, CEO at AuAg Funds and founder of the AuAg ESG Gold Mining UCITS ETF says, ‘Mining is an industry that has seen vast improvements in all aspects of ESG, but standards vary across regions and companies. ESGO helps investors get exposure towards gold mining companies with the best ESG credentials and invest in the sector more responsibly.’

‘Launching the AuAg ESG Gold Mining UCITS ETF (ticker: ESGO) is the next major step for AuAg Funds. We already have two daily-traded UCITS funds in AuAg Silver Bullet and AuAg Precious Green, both with a focus on precious metals and green-tech elements. Now we’ve designed a unique index and added our first Exchange Traded Fund to the family.’


Andrea Gaini