AAll federal agencies received instructions in January from President Biden to prepare climate change plans that would identify the impacts of a warming world on their operations and what actions the agency would take to help mitigate those impacts. USDA released its plans on October 7e which described what the threats were as well as how it would work to mitigate the consequences of climate change.

The plan breaks down threats to the USDA and stakeholders into five main categories, then outlines five main responses the agency will have as part of the focused federal response to global warming.

“Not only does climate change have a direct impact on a producer’s ability to plan and manage risk, it has broader impacts on the natural systems we rely on to support food and fiber production. , keep our waters clean and maintain cultural resources. USDA Secretary Tom Vilsack said in the report.

Threats that USDA deems most critical include decreased agricultural productivity due to changes in temperature and weather, threats to water systems which include quantity and quality caused by changes in the water cycle. water, and the disproportionate impact that climate change will have on vulnerable communities. Other main challenges include the widespread shock to systems caused by extreme weather events such as forest fires and hurricanes, and the stress that climate change will have on infrastructure and public lands.

USDA’s response to help mitigate impacts includes helping build resilience with conservation practices, promoting “the adoption and application of climate-smart adaptation strategies,” which include green technologies, making climate data more readily available to stakeholders, supporting the research and development of new ‘climate-smart’ technologies and practices and other best practices that will help educate and to disseminate information.

Investing in ESG with SPDR

Climate control and the mitigation of global warming are major concerns and concerns of regulators, governments and investors. For investors looking to gain exposure to companies from an ESG perspective, State Street Global Investors offers several options.

One of these options is the ETF SPDR S&P 500 ESG (EFIV), which takes a holistic approach to ESG investing by focusing not only on the environmental aspect of ESG, but also on sustainability through the social and governance practices of the companies in which it invests.

The fund tracks the S&P 500 ESG index, which selects the best companies meeting the S&P 500 ESG criteria, while respecting the sector weightings of the S&P 500 index.

EFIV uses SPDJI’s ESG scores to rank companies based on their sustainability. This score is derived from analyzing a thousand data points covering a variety of topics collected from companies and then asking about 120 questions, according to the S&P Global website.

EFIV excludes companies involved in tobacco and controversial weapons, those that derive 5% or more of their income from thermal coal mining or generate electricity from coal, or score low compared to United Nations Global Compact standards.

The ETF’s top three sector allocations include 30.57% in information technology, 14.61% in consumer discretionary and 12.15% in healthcare, along with several other smaller allocations.

EFIV has an expense ratio of 0.10%, making it one of the cheapest ESG ETFs on the market.

For more news, information and strategy, visit the ESG channel.

Learn more at ETFtrends.com.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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