S&P Launches Carbon Indices

Mar 13 2009 | 1:05am ET

Standard & Poor's has launched the first in a series of global low carbon indices to meet the growing investor demands for environmentally focused indices.

The S&P U.S. Carbon Efficient Index will measure the performance of large cap U.S. companies with relatively low carbon emissions, while seeking to closely track the return of the S&P 500.

The new Index, which is part of the Standard & Poor's global thematic index series, provides a benchmark to the market while allowing investors to create financial products that seek to gain exposure from a more environmentally efficient perspective.

"Organizations around the world are paying greater attention to the impact of greenhouse gases on our climate, as increasingly more investors consider carbon efficiency as an important investment theme," said David Blitzer, managing director and chairman of the Index Committee at Standard & Poor's Index Services. "Standard & Poor's is the first independent index provider to offer a broad U.S. market index with an environmental focus, reinforcing our position as the premier provider of global thematic focused indices."

With the addition of the S&P US Carbon Efficient Index to the global thematic family, the series will now cover such green themes as Water, Forestry, Eco and Carbon efficiency.

To reflect its carbon efficiency, the Index is comprised of constituents of the S&P 500 that have a relatively low Carbon Footprint, as calculated by Trucost Plc. The environmental data organization quantifies the environmental impact of over 4,500 companies across different sectors and geographies. A Carbon Footprint is calculated as a company's annual greenhouse gas emissions assessment (expressed as tons of carbon dioxide equivalent) divided by annual revenue.

"With the world's most comprehensive database of corporate carbon emissions, Trucost is uniquely able to provide Standard & Poor's with information to significantly reduce the carbon exposure of its Index," said Simon Thomas, chief executive of Trucost.

Through 2008, the average annual Carbon Footprint of the S&P U.S. Carbon Efficient Index was 48% lower than that of the S&P 500.

Who is investing in clean technology?
Find out, visit our sister publication
CleanTech Brief

In Depth

Financial Industry Blockchain Consortium R3 To Open-Source Platform Code

Oct 20 2016 | 9:03pm ET

Bitcoin's blockchain technology has spawned a flurry of activity among fintech startups...


U.S. Trust's Beard: The Rapid Growth of the Art Lending Industry

Oct 7 2016 | 10:55pm ET

Alternative investment managers have emerged as some of the most significant art...

Guest Contributor

Hedge Fund Marketing – Tips for Your Initial Sales Meeting

Sep 29 2016 | 5:46pm ET

There are two main goals a hedge fund should have for an initial in-person sales...