TIAA-CREF announced Aug. 11 the launch of two mutual funds that incorporate environmental, social and governance (ESG) criteria as part of their security selection process:
- The TIAA-CREF Social Choice International Equity Fund seeks long term capital appreciation by investing in the securities of companies in developed international markets outside of the United States that are best-in-class ESG leaders within their respective sectors.
- The TIAA-CREF Social Choice Low Carbon Equity Fund seeks long term capital appreciation as a diversified domestic equity fund that combines comprehensive ESG criteria and an additional focus on companies’ current and future carbon emissions.
The TIAA-CREF Social Choice International Equity Fund will use the MSCI EAFE Index as its benchmark, while TIAA-CREF Social Choice Low Carbon Fund will benchmark investments against the Russell 3000 Index and employ a proprietary quantitative process and industry-recognized risk model to match the long-term performance of the U.S. equity market.
As part of its ESG evaluation process, TIAA-CREF assesses securities eligible for its Social Choice funds based on demonstrated ESG leadership in their respective sectors, including impact on stakeholders such as employees, communities, customers, suppliers and the environment. In addition, companies are evaluated on industry-specific ESG criteria such as natural resource usage, effect on climate change, supply chain practices and corporate governance. The TIAA-CREF Low Carbon Equity Fund applies another layer of criteria that takes into account current and future carbon emissions.
Both funds will be managed by Philip James (Jim) Campagna and Lei Liao, with the active involvement of TIAA-CREF’s Responsible Investment team in assessing the ESG qualifications of the securities selected for the portfolios.
