Engine No. 1 preps scarcity-themed ETF

The actively managed ETF would hold companies focused on addressing resource scarcity

The small asset management firm that less than two years ago won board seats at Exxon Mobil is planning to launch its third ETF.

Last Friday, Engine No. 1 filed an initial prospectus for its Transform Scarcity ETF. That product, which could commence trading in less than three months, would invest in 20 to 60 small to large companies that are addressing current and future resource scarcity, according to the filing. That includes companies that “are transforming their own or others’ use of scarce resources within their products, services or business operations, relying on more sustainable alternatives … innovating renewable technologies or creating more efficient processes that recycle, reuse or regenerate,” the firm stated in the prospectus.

The categories of scare resources include food and agriculture; water; land; and people, with the latter ranging from education and skills training to reproductive services.

The actively managed ETF would be overseen by Engine No. 1 Director of ETF Portfolio Management Molly Landes, active ETF group leader Eli Horton and founder Christopher James.

Engine No. 1 currently has two ETFs: the passively managed $366m Transform 500 ETF; and the actively managed $89m Transform Climate ETF.

A public relations group that works for firm said in an email that it would not comment about the forthcoming ETF.

Engine No. 1 made headlines in 2021 following a historic proxy vote at Exxon Mobil, with three of the asset manager’s nominees winning seats on the company’s board. The firm had engaged with Exxon over transitioning to a lower-carbon business, its long-term capital allocation discipline and other issues.