April 9, 2019 / News

ESG version of S&P 500 launched

By Joe McGrath, ESG Clarity

The index will be used by UBS Asset Management in a new exchange traded fund

ESG version of S&P 500 launched

Index provider S&P Dow Jones Indices has launched a sustainable version of the S&P 500 index and a new scoring system, calculated by the data and benchmarking arm of Robeco SAM.

The S&P 500 ESG Index is designed to replicate the S&P 500 benchmark but with an ESG criteria selection overlay, S&P DJI said in a media announcement on Monday. It is hopeful that the index will be adopted by investment groups as a basis on which to create new index-based funds.

“Our philosophy as an independent index provider is to offer choice to investors,” chief executive officer Alex Matturri said. “We will continue to contribute to the growth of sustainable finance and economies through our indices.”

The company launched its first sustainability index back in 1999, when it unveiled the Dow Jones Sustainability World Index. More recently, it agreed terms with UBS Asset Management for the Swiss fund group to launch an exchange traded fund based on the S&P 500 ESG Index.

“An increasing number of investors require indices that are aligned not only with their investment goals but also their individual and institutional values,” said Reid Steadman, global head of ESG Indices at S&P DJI. “The S&P 500 ESG Index is constructed with both of these needs in mind.

“Unlike many ESG indices that preceded it – which were more thematic or narrower in their focus – the S&P 500 ESG Index is broader and developed to target the core of an investor’s portfolio.”