WDEF/WDEP/EUDFWisdomTree Europe Defence UCITS ETF - EUR Acc

Responsible Investing

SFDR Disclosure

The EU Sustainable Finance Disclosures Regulation (SFDR) took effect on 10 March 2021 as part of the EU Action Plan on Sustainable Finance. The SFDR lays down harmonised sustainability related disclosure rules for EU financial market participants and advisors and requires certain sustainability disclosures to be made for financial products which promote environmental or social characteristics (Article 8 SFDR) and funds which have a sustainable investment objective (Article 9 SFDR).

There are different SFDR product categorisations for these sustainability disclosure requirements:

+ Article 6 products: require disclosures relating to the manner in which sustainability risks are integrated into the decision-making process.
+ Article 8 products: promote, among other characteristics, environmental or social characteristics or a combination of those characteristics, provided that the companies in which the investments are made follow good governance practices.
+ Article 9 products: have sustainable investment as their objective

Please refer to EU regulation guidelines for more details: https://www.esma.europa.eu/sections/sustainable-finance

ESG Characteristics

The fund tracks an index which seeks to exclude from the eligible investment universe companies that (i) are involved in certain controversial weapons such as anti-personal mines, cluster munitions, chemical and biological weapons, depleted uranium weapons and white phosphorus weapons and those that support nuclear weapons programmes to states outside the Treaty on the Non-Proliferation of Nuclear Weapons (commonly known as the Non-Proliferation Treaty or “NPT”) and (ii) violate, certain commonly accepted international norms and standards, such as United Nations and OECD guidelines.

1. The Europe Defence index excludes companies based on Global Standard Screening (GSS) and certain controversial weapons criteria defined in the index rulebook.
2. Global Standard Screening (GSS)
   • GSS is an assessment on whether a company is violating, or is at risk of violating, one or more of the UN Global Compact principles and related international norms and standards.
   • WTI will exclude companies that are non-compliant based on the ESG data providers’ GSS assessment. GSS identifies companies that violate or are at risk of violating commonly accepted international norms and standards, such as the United Nations Global Compact (UNGC) Principles, the UN Guiding Principles on Business and Human Rights (UNGPs), the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises and their underlying conventions.
3. Controversial weapons:
   • WTI will exclude the companies that are involved in certain controversial weapons, such as anti-personnel mines, cluster munitions, chemical and biological weapons, depleted uranium weapons and white phosphorus weapons and those that support nuclear weapons programmes to states outside the Treaty on the Non-Proliferation of Nuclear Weapons (commonly known as the Non-Proliferation Treaty or “NPT”).
   • As the selection of eligible companies is also limited to those companies conducting their primary business in select developed or emerging European countries that are signatories to the Treaty on the Non-Proliferation of nuclear weapons (commonly known as the Non-Proliferation Treaty or ‘NPT’), all selected companies which are involved in nuclear weapon production are subject to the Treaty on the Non-Proliferation of nuclear weapons.

Visit our ESG Hub to learn more about WisdomTree's ESG approach.