The marquee name may be Cousteau, but no one wants this new ETF to go underwater.
Philippe Cousteau, the grandson of famed marine conservationist Jacques Cousteau, joined forces with AdvisorShares, the sponsor of the most actively managed ETFs, to create a new socially responsible ETF that hopes to do well by doing good.
The AdvisorShares Global Echo ETF (GIVE) is “the first ETF to be launched with a sustainability mandate,” says Cousteau, the co-founder and president of Earth Echo International, a non-profit that creates programs to educate people on protecting and restoring the oceans. This focus on sustainable investments means the fund’s four subadvisors must look for investments through a screen of sustainability in one of three categories, environmental, social or governance. Sustainable governance means forging strong relations with its community and having strong corporate governance of the company’s funds.
“There can be no environmental sustainability without social sustainability, says Cousteau.
Because of the difficulty in raising money for charitable organizations in the current economy, Cousteau joined with AdvisorShares as a way to fund causes he believes in on a steady basis.
Thus one objective of the ETF is to donate about a quarter of its very high 1.7% expense ratio to the Global Echo Foundation, Cousteau’s new 501 (c)(3) charitable organization. The Global Echo Foundation, which launched with the ETF, hopes to provide resources to solve social issues affecting women and children, environmental conservation and support entrepreneurship through micro-enterprise. It aims to provide investors the best of two worlds: making investments in companies providing a sustainable impact, while also helping Global Echo, and hopefully, realizing a return on their capital.
At the time of the launch, the foundation didn’t know exactly where it would place its donations. Cousteau suggested groups like Girl Effect, which seeks to alleviate poverty by investing in girls, and Grameen Bank, a microfinance organization in Bangladesh.
Four asset managers will each run a quarter of the ETF’s portfolio. Community Capital Management manages sustainable fixed income strategies that invest in bonds that support and finance affordable housing. Baldwin Brothers invests in global equites that follow sustainable investment themes. Reynders, McVeigh Capital Management invests in global equities focuses on sustainability and concentrated growth. First Affirmative Financial Network manages long/short strategies with alternative investments, such as commodities.