Investment management firm VanEck will list the first carbon credit exchange traded fund (ETF) on the Australian Securities Exchange (ASX), as reported by the Australian Financial Review on May 24. The fund, VanEck Global Carbon Credits ETF (Synthetic), may begin trading under the ticker XC02 in the coming weeks once approvals from the ASX and other regulatory bodies have been granted. The ETF tracks the Australian-dollar version of the ICE Global Carbon Futures Index, which comprises of carbon prices from four of the world’s carbon markets, namely the European Union’s Emissions Trading Scheme, the UK Emissions Trading Scheme, the Western Climate Initiative (WCI) in California, and the Regional Greenhouse Gas Initiative (RGGI) in the northeastern United States.

As the global fight against climate change continues, carbon credit prices in carbon markets around the world are expected to rise significantly, making carbon credit funds attractive to investors, according to Arian Neiron, CEO of VanEck Asia-Pacific. Many companies with environmental, social, and governance (ESG) strategies in place are also looking to carbon credits to help them align with ESG goals. VanEck anticipates the fund to capture the surging interest for green investment options from Australian investors, as the country’s recent federal election signals strong support for more progressive climate action. As of now, Australia does not have its own carbon market.

Sources:

https://www.afr.com/companies/financial-services/australia-s-first-carbon-credits-etf-set-to-hit-asx-20220523-p5anr4#:~:text=Claiming%20to%20be%20Australia’s%20first,carbon%20or%20greenhouse%20gas%20emissions

https://www.investordaily.com.au/news/51397-vaneck-prepares-to-launch-australian-first-carbon-credits-etf