Betterment Unveils New Socially Responsible Investment Offerings

Climate Impact, Social Impact, and an updated core socially responsible investing portfolio immediately available to all Investing customers

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NEW YORK, October 22, 2020 — Betterment, a smart money manager, today announced new Socially Responsible Investment (SRI) portfolio offerings that will allow customers to invest for environmental and social impact, without sacrificing the portfolio diversification, tax-optimization or performance that Betterment strives to deliver. The existing SRI offering, first made available in 2017, is receiving a number of enhancements, and will now be known as the Broad Impact portfolio. The company is also offering two new portfolios, Social Impact and Climate Impact. The offerings will also be available to Betterment for Business and Betterment for Advisors customers.

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The Climate Impact Portfolio

The new Climate Impact portfolio is designed with a particular focus on mitigating climate change, featuring three distinct global allocations: First, towards companies with the lowest carbon footprints within every sector. Second, towards funds which specifically exclude companies holding fossil fuel reserves. Third, towards “green bonds”, which fund environmentally beneficial projects across the world, including alternative energy, pollution control, and climate adaptation.

“Energy and urgency around values-driven investment continues to grow, and we can no longer assume which causes matter most to our customers,” said Boris Khentov, SVP, Operations & Legal Counsel at Betterment. “We set out to do better for them, and that means continuing to evolve our Broad Impact approach, but also increase options, through customization. Investors shouldn’t have to guess whether their investments are maximizing the impact they value most, and they shouldn’t have to to choose between social good and lower costs: they deserve a values-based portfolio which is both built on a low-cost, diversified investment strategy, and which reflects their personal values.”

The Social Impact

The new Social Impact portfolio builds on Betterment’s Broad Impact portfolio with an additional focus on U.S. companies that value diversity, including both the NACP ETF, designed to provide exposure to U.S. organizations with stronger racial and ethnic diversity policies, based on criteria developed by the NAACP, and the SHE ETF, which provides exposure to U.S. companies that demonstrate greater gender diversity within senior leadership.

Customers who already invest via Betterment’s existing SRI offering can opt into the Broad Impact portfolio, which is an evolution of the existing SRI offering with even more expansive ESG coverage, or start a new investment goal through the platform and express a more directed interest in environmental or social impact. Customers with a 401(k) account through Betterment for Business will be able to choose any of the three new portfolios for their investment strategy, and advisors using Betterment for Advisors will be able to offer all three portfolios to their clients. To learn more, visit https://www.betterment.com/socially-responsible-investing/.

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