BlackRock to offer new gun-free ETFs

(Bloomberg) –BlackRock Inc., the world’s largest asset manager, plans to start two exchange-traded funds that will exclude civilian firearm makers and large sellers in the wake of the Florida high school shooting.

The iShares MSCI USA Small-Cap ESG Optimized ETF, which will start trading on or about April 12, will track investment results of an index that is mostly made up of small-cap U.S. companies, according to a company release Thursday. BlackRock also filed an initial registration statement for the iShares ESG US Aggregate Bond ETF. Both ETFs will exclude producers and big retailers of civilian firearms.

The response by New York-based BlackRock comes after 17 people were shot dead at a Florida high school in February. The company said in March that it opened discussions with gunmakers and retailers to engage them on the steps they are taking to support the safe and responsible use of weapons.

The shooting has reignited the debate around gun control and background checks to prevent future tragedies. BlackRock is the biggest institutional owner of firearms stocks through its passive products.

The money manager is also offering certain pension and 401(k) plans that want to exclude firearms from employee retirement programs five strategies that will exclude these investments.

For its existing ETFs that screen for environmental, social and governance factors, known as ESG, the company is making the criteria for underlying indexes more explicit to prevent holdings of civilian firearms manufacturers and large retailers of them.

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