Middlefield Limited, the manager of the Middlefield Sustainable Global Dividend ETF (TSX: MDIV) and the Middlefield Sustainable Infrastructure Dividend ETF (TSX: MINF), has announced plans to reduce the emphasis on environmental, sustainability, and governance (ESG) factors in the Funds’ investment approach. The changes, which include revisions to the Funds’ names, investment objectives, and strategies, aim to broaden the investment universe and potentially enhance returns for investors. However, the Funds will retain ESG considerations as part of their issuer selection process.
The adjustment aligns with industry trends, where asset managers like BlackRock, State Street, JPMorgan, and Pimco have also scaled back ESG mandates. According to research by Morningstar, more funds are moving away from prioritising ESG factors. Additionally, the Canadian Securities Administrators (CSA) recently introduced three categories for ESG-related funds—ESG Objective Funds, ESG Strategy Funds, and ESG Limited Consideration Funds. Following the proposed changes, the Middlefield Funds are expected to shift from the ESG Objective category to ESG Limited Consideration.
Special meetings for unitholders of MDIV and MINF are scheduled for January 30, 2025, with voting eligibility determined as of December 23, 2024. At the meetings, unitholders will decide on the proposed revisions. Detailed information will be provided in an upcoming circular, and if approved, the changes will be incorporated into the Funds’ Prospectus renewal, anticipated in March 2025.
The Manager remains confident that the proposed changes will offer a more flexible investment approach while adapting to evolving market practices and regulatory frameworks.
