Pax World Launches Effort to Reduce Carbon Intensity in its Funds
Global Environmental Markets Fund is fossil fuel-free and carbon neutral
PORTSMOUTH, N.H.///June 24, 2013/// Pax World Management LLC, investment adviser to Pax World Funds (www.paxworld.com) and a leader in the field of sustainable investing, announced today the results of carbon benchmarking of its five largest equity funds, the first phase of an effort to reduce the carbon intensity of all its portfolios over time. The carbon benchmark was performed by Trucost®, a leading environmental data and analysis firm. Four of the five funds measured are already less carbon intensive than their benchmark indexes, and Pax World intends to set goals for further reducing their carbon footprint.
In addition, Pax World announced that it is taking steps to fully offset the carbon emissions of the Pax World Global Environmental Markets Fund (PXEAX), which is already a fossil fuel-free portfolio and will now become carbon neutral as well.
“We are pleased that Trucost’s findings seem to confirm that our sustainable investing approach generally contributes to lowering the carbon intensity of our mutual fund portfolios,” said Pax World President and Chief Executive Officer Joe Keefe. “But we want to take an even more proactive approach by further reducing our carbon footprint over time. Moreover, I am pleased to announce that our Global Environmental Markets Fund will henceforth be not only fossil fuel free but carbon neutral as well, which we believe makes it a uniquely attractive option for environmentally-conscious investors.”
Carbon benchmarking measures a fund’s carbon intensity, which is the total metric tons of carbon emissions per million dollars of revenue of the companies in its portfolio, as compared to the emission levels of companies included in a fund’s benchmark index. The fund’s share of the emissions is based on its proportional ownership of the stock of each company in its portfolio.
Carbon offsets allow investment portfolios to mitigate their carbon emissions by purchasing third-party verified CO2 offsets in the voluntary market. Carbon mitigation is achieved through financial support of projects that reduce greenhouse gas (GHG) emissions.
Carbon neutral fund
According to Trucost’s analysis, companies represented in the Pax World Global Environment Markets Fund generated carbon emissions totaling 13,102 tonnes. To offset these emissions and achieve carbon neutrality for the fund, Pax World is purchasing carbon offsets from projects that focus on the capture of methane gas emissions from landfills to produce electricity.
Pax World Climate Policies
In addition to its carbon mitigation efforts, Pax World avoids investing in companies with primary businesses in coal mining and production of oil from tar sands, two of the most environmentally destructive and carbon-intensive fossil fuels. In addition, Pax World seeks to avoid investments in any electric utility that relies on coal for power generation at levels above the national average, unless the utility demonstrates a significant commitment to renewable energy and is reducing its coal dependence.
Pax World also uses corporate shareholder engagement to urge companies to address climate-related risks and mitigate their emissions while supporting public policy advocacy initiatives to hasten a transition to renewable energy.
“The science is clear,” Keefe says. “If we are to avoid catastrophic global warming, we must take meaningful steps to reduce GHG emissions right now. Carbon benchmarking, carbon reductions and carbon-neutral portfolios can make a meaningful contribution to mitigating climate change.”
About Pax World Management LLC
Pax World Management LLC, the investment adviser to Pax World Funds, is a recognized leader in sustainable investing, the full integration of environmental, social and governance (ESG) factors into investment analysis and decision making. Pax World launched the U.S. financial industry’s first socially responsible mutual fund in 1971. Today, Pax World offers a comprehensive platform of sustainable investing solutions including Pax World Funds, a family of actively managed mutual funds; ESG Managers® Portfolios, multi-manager asset allocation funds powered by Morningstar Associates; Pax MSCI EAFE ESG Index ETF (EAPS), the only international equity ETF available in North America that employs a sustainable investing approach; and separately managed accounts for institutional investors. For more information, visit www.paxworld.com.
The benchmark for the Global Environmental Markets Fund is the MSCI World Index. The MSCI World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed markets. The MSCI World Index consists of the following 24 developed market country indices: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom, and the United States. Performance for the MSCI World Index is shown “net”, which includes dividend reinvestments after deduction of foreign withholding tax. One cannot invest directly in any index.
RISKS: Equity investments are subject to market fluctuations, the fund’s share price can fall because of weakness in the broad market, a particular industry, or specific holdings. Emerging market and international investments involve risk of capital loss from unfavorable fluctuations in currency values, differences in generally accepted accounting principles, economic or political instability in other nations or increased volatility and lower trading volume.
You should consider a fund's investment objectives, risks and charges and expenses carefully before investing. For this and other important information, please obtain a fund prospectus by calling 800.767.1729 or visiting www.paxworld.com. Please read it carefully before investing. Past performance is no guarantee of future results.
Investments involve risk, including potential loss of principal. Stocks will fluctuate in response to factors that may affect a single company, industry, sector, or the market as a whole and may perform worse than the market.
Distributor: ALPS Distributors, Inc., Member FINRA.
ALPS is not affiliated with any company mentioned in this letter.