Varma Mutual Pension Co., Helsinki, invested €500 million ($553 million) in an exchange-traded fund created by Legal & General Investment Management and index provider Foxberry, the €46.5 billion Finnish pension company said Tuesday on its website.
The customized ETF provides the Finnish investor with exposure to U.S. equity with a sustainable focus, aimed at reducing carbon emissions. The index excludes tobacco companies, industries that manufacture controversial weapons and companies whose operations use coal.
The index also excludes companies that have breached international agreements and standards on human rights.
"As the responsible investment sector grows, the development of index funds with an increasingly responsible tilt is key, and they are precisely where change is needed," said Timo Sallinen, senior vice president for investments, in a news release.
"Alternatives are needed for exclusion-based products. We believe that co-operation between stakeholders goes a long way in promoting responsible investment. Many investors on their own may lack the resources to thoroughly look into companies for exclusion purposes," Mr. Sallinen added in the news release.