MSCI launches family of low carbon indexes, first to address reserves.

Climate, Coal, Finance, Gas, Oil

Business Wire:  “MSCI Inc. (NYSE:MSCI), a leading provider of investment decision support tools worldwide, announced today the launch of the MSCI Global Low Carbon Leaders Indexes, consisting of companies with significantly lower carbon exposure than the broad market.”
“This collaboration with MSCI, AP4 and FRR is also an excellent illustration of our index fund management capabilities and our core focus on providing fully tailored index solutions to our clients.”
The indexes were developed at the request of and with critical insights from Fourth Swedish National Pension Fund AP4, Fonds de Réserve pour les Retraites (FRR) and Amundi, who were looking for representative benchmarks in the transition to a low carbon economy. MSCI then consulted on the proposed methodology with a variety of investors globally.
The MSCI Global Low Carbon Leaders Indexes are based on the MSCI ACWI Index, the global policy benchmark covering developed and emerging markets, and utilize MSCI ESG CarbonMetrics data from MSCI ESG Research Inc. The MSCI Global Low Carbon Leaders Indexes are the first in the industry to address two dimensions of carbon exposure – carbon emissions and fossil fuel reserves – providing clients with an effective tool for limiting the exposure of their portfolios to carbon risk. While selecting companies with a lower carbon exposure, the indexes aim to maintain a wide and consistent market exposure by minimizing the tracking error compared to the performance of the parent standard indexes.
….Mats Andersson, CEO of AP4, commented, “We are delighted to have contributed, with FRR and Amundi, to the launch of MSCI Global Low Carbon Leaders Indexes, as we see a low carbon investment approach becoming more popular and mainstream. AP4 plans to invest with its partners up to EUR 1 billion in these new low carbon investments. Combined with a carbon footprint disclosure, we are confident that this approach can offer an alternative source of return while working for the public good.”
….MSCI and Amundi will together run a series of roadshows around the world to present their respective expertise and capabilities.
The launch of the MSCI Global Low Carbon Leaders Indexes has received the support of various internationally renowned organizations, among them UNEP FI.”