New emerging market ESG indices

Bloomberg and MSCI have collaborated to launch 10 ESG fixed income indices.

The Bloomberg Barclays MSCI Emerging Markets ESG index suite incorporate ESG and socially responsible investing (SRI) considerations in underlying hard and local currency emerging market fixed income indices.

“Investor demand for ESG considerations continues to grow, and we are consistently working to expand Bloomberg’s offerings to meet these requirements as ESG factors are increasingly incorporated into investors’ workflows,” said Chris Hackel, index product manager at Bloomberg, in a statement.

The index stable includes the following:

  • Bloomberg Barclays MSCI EM ESG Weighted Indices, which uses MSCI ESG ratings to tilt issuer market weights.
  • Bloomberg Barclays MSCI EM SRI indices, which are designed to screen out issuers with substantial revenue derived from sources such as adult entertainment, alcohol, gambling, tobacco, controversial military weapons, civilian firearms, nuclear power, and genetically modified organisms.
  • Bloomberg Barclays MSCI EM Sustainability indices, which uses emerging markets debt benchmarks that include fixed and floating-rate US dollar-, Euro- and UK sterling-denominated debt issued from sovereign, quasi-sovereign, and corporate EM issuers. The index includes issuers with BB and above ESG ratings.

“We have seen accelerating demand from investors to expand ESG Indexes and data solutions across asset classes and markets,” said Eric Moen, head of ESG product at MSCI, in the statement.

“This newly launched emerging markets fixed income index family extends the breadth of coverage of ESG fixed income indexes and provides institutional investors with additional options for indexed funds and for benchmarking performance,” he added.