Global index provider FTSE Russell has spiced up its suite of sustainability-themed benchmarks with two new offerings.
In a release last week, the London Stock Exchange (LSE) owned entity says its FTSE4Good index range would number 14 after adding the new Emerging Markets and Emerging Latin America indices to the pile.
Concurrently, the LSE benchmark business – formed last year following the merger of FTSE with the carved-off Russell index arm – also released its underlying environmental, social and governance (ESG) data model to subscribers.
The new ESG Ratings analytics includes data “on more than 4,100 companies across more than 300 indicators”, the FTSE Russell release says.
Along with the ESG data service, FTSE Russell recently added the Green Revenues model and a new Smart Sustainability index to the eco-friendly product range.
“Green Revenues (LCE) is a ground breaking data model that tracks companies that generate green revenues, a critical component missing from current sustainability models,” the statement says. “The Smart Sustainability index is the first to combine a smart beta factor approach alongside climate change considerations.”
The FTSE4Good index brand launched in 2001 with three underlying indices built on 40 ESG data points (compared to the latest 300 plus metrics).
Mark Makepeace, FTSE Russell chief, said sustainable investing has moved from the fringes to the mainstream for institutional investors over the last 15 years.
Makepeace said professional investors were dubious about the value of ESG factors when the FTSE4Good range first rolled out in 2001.
“Since then, the world and the investment landscape has changed beyond recognition and sustainable investing, climate risk, the transition to a low carbon economy, and ESG integration are now a core focus for our clients across asset owners, asset managers, consultants and banks,” he said in the statement.
LSE purchased the Frank Russell business in 2014 for about US$2.7 billion, primarily to boost FTSE’s presence as index provider to the booming passive and exchange-traded fund trade via the long-established Russell indices unit.
In June this year LSE completed the sale of the Russell Investments business to two US private equity firms – TA Associates and Reverence Capital Partners – for US$1.15 billion.