iShares ESG Aware MSCI EM ETF

iShares ESG Aware MSCI EM ETF (ESGE) is a BlackRock index fund tracking the MSCI Emerging Markets Extended ESG Focus Index, which tilts the broad MSCI Emerging Markets Index toward companies with better environmental, social and governance (ESG) ratings. It drops tobacco, controversial weapons, civilian firearms and some coal and oil sands firms but aims to behave like the broad index. Its 0.25% expense ratio is near the peer average; IEMG charges 0.09%.

• Over the year to Oct 27, 2026, ESGE returned +15.2%, 3rd of 9 among similar funds.
• Its 5-year annualized return was +6.4% and its 10-year +8.2%.
• In the 2020 COVID crash it fell 30.9% and regained its old high 4.2 months after the low.
• Its worst full calendar year was 2022 (-22.4%); its best was 2017 (+38.9%).
• The deepest fall in its price history was 41% (Feb 17, 2021 to Oct 24, 2022), recovered by Sep 11, 2025.

As of Aug 31, 2026, the fund held 306 securities; the ten largest made up 37.95% of assets.

• Over the three months to Aug 31, 2026, investors withdrew a net $61.6M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +0.23%, -5.08%, +4.19%.

The fund follows the MSCI Emerging Markets Extended ESG Focus Index, built by MSCI. MSCI starts with the MSCI Emerging Markets Index, which covers large and mid-sized companies in developing economies. It then removes tobacco companies, controversial weapons makers, civilian firearms producers and retailers, and firms with certain fossil fuel activity, such as thermal coal, coal-fired power and oil sands. Some cuts use revenue limits, such as $20 million or 5%. Companies caught in very severe, ongoing controversies are also removed.

Next, an optimizer sets each stock's weight. An optimizer is a computer model. Here it raises exposure to companies with higher ESG ratings while keeping risk and return close to the parent index. At each quarterly review, the index's ESG score must be at least 10% better than the parent's. The largest companies still dominate. As of August 31, 2026, Taiwan Semiconductor Manufacturing made up 15.1% of the fund, Samsung Electronics 7.3% and SK hynix 5.6%. The top 10 of 306 holdings came to 38%.

BlackRock uses representative sampling. That means it holds a set of stocks that closely matches the index without necessarily owning every one. At least 90% of assets go into index stocks or close equivalents, such as depositary receipts. Up to 10% can be in futures, options, swaps and cash. The fund may also lend out securities worth up to one-third of its assets.

• ESGE charges 0.25% a year, versus an average of 0.24% for the similar funds below (6th of 9, cheapest first).
• Using the prospectus's standard example, $10,000 invested would cost about $26 in the first year and $318 over 10 years (assuming a 5% annual return).

It adds emerging market stocks with an ESG tilt, but it is concentrated in a few Asian chipmakers and has fallen steeply in past downturns.

ESGE could add emerging market companies to a portfolio built mostly on US stocks, but its price has swung widely. In the 2020 COVID crash it fell 30.9% and recovered in about four months. In the 2022 bear market it fell 33.3% and took 32 months to recover, until June 10, 2025. Its deepest drop was 41%, from February 2021 to October 2022. It did not recover until September 11, 2025. Its worst calendar year was 2022, at -22.33%. Selling shares to pay for spending during a stretch like that would have locked in losses. The fund launched in 2016, so it has no 2008 record. The yield was 2.23% as of October 27, 2026, paid twice a year. Under the SEC's standard example, costs on $10,000 come to about $26 in the first year. Past results don't predict future returns, and a plan should look at the whole portfolio, not one fund.

Matched by holdings overlap from the latest N-PORT reports.