BlackRock Australia launches iShares ESG Model Portfolios to expand its suite of ESG outcome-oriented investment solutions for Australian investors

From

Brett Taggart

BlackRock Australia has announced the launch of its iShares ESG Model Portfolios (‘ESG Portfolios’) for Australian investors as part of its commitment to make sustainability more accessible and affordable to a broader base of investors.

The ESG Portfolios apply BlackRock’s multi-asset strategy capabilities and are implemented using iShares ETFs and BlackRock index funds, making them some of the most affordable model portfolios in the Australian market. The ESG Portfolios are currently available on Praemium and are expected to be available on additional platforms later this year.

By incorporating ESG considerations throughout the portfolio construction process, the five portfolios – Conservative, Balanced, Moderate, Growth and Aggressive – offer investors a range of options based on risk profiles while also meeting their sustainability goals.

The ESG Portfolios aim to make it easier for advisers by working seamlessly within a separately managed account (SMA) structure. The platform automates the client portfolio rebalancing process, provides institutional-quality risk analysis reporting via BlackRock’s proprietary technology platform Aladdin, and offers the support infrastructure needed to handle client reporting requirements for advisers.

In its inaugural review, SQM Research awarded the ESG Portfolios a 4-star “Superior” rating. SQM Research attributed this rating to the rigorous portfolio construction process of setting and reviewing the Strategic Asset Allocation (SAA), the cost-effectiveness of the portfolios, as well as BlackRock Multi-Asset Strategy and Solutions (MASS) team-based approach to investment strategy, portfolio management, trading, client services and operations.

The ESG Portfolios are managed by the BlackRock MASS team based in Sydney and Hong Kong. The team has managed multi-asset portfolios for Australian clients since 1992, with around A$50 billion in assets[1] across its diversified funds range, model portfolios, absolute return strategies, and custom mandates.

Chantal Giles, Head of Wealth, BlackRock Australasia said: “BlackRock’s focus is on democratising access to sustainability strategies, making sustainability the standard for investing.

Our fiduciary role is to guide clients along the way from “traditional” strategies to those that incorporate sustainability in various meaningful ways. For this specific product suite, Bell Partners reached out to BlackRock to design a series of ESG Model Portfolios that aim to meet the desired long-term investment and sustainable goals of its clients.

These ESG Portfolios aim to provide institutional-quality asset allocation across a range of client risk profiles. The creation of these portfolios also helps advisers reduce the time spent on operational oversight and administrative tasks while delivering institutional quality services to their clients through accessing BlackRock’s global investment expertise.”

Brett Taggart, Managing Director, Bell Partners said: “Our clients are increasingly looking to us to provide ESG-focused investment solutions so naturally we reached out to BlackRock to help design a set of options that best suit both our clients’ varying risk/return profiles as well as their long-term sustainability objectives.

We recognise the need for a holistic investment solution that can deliver on these goals so applying BlackRock’s ESG investment approach to its long-standing Model Portfolios made sense to us. Not only is it a cost-efficient way to seek outperformance, but it also delivers a consistent and compliant investment process for every client.”

Katie Petering, Head of Multi-Asset Strategy and Solutions Product Strategy, BlackRock Australasia said: “BlackRock’s iShares ESG Model Portfolios aim to make it easier for advisers to serve their clients by providing a whole portfolio solution tailored to the clients’ specific risk/return investment and sustainability goals.

“BlackRock’s five ESG portfolios deliver a cost-effective opportunity for investors to gain exposure to this important and growing investment thematic, while enabling advisers to allocate more time to their core business of delivering advice and solutions to their clients.”

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[1] Data as of 31 March 2022

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