The FTSE EU Climate Benchmarks Index Series is designed to reflect the performance of global, regional and domestic equity market indices, where the weights of index constituents vary to account for risks and opportunities associated with the transition to a low carbon economy. The methodology aligns to the minimum standards for EU Low Carbon Benchmark Requirements* and supports investors’ decarbonisation or net zero strategies. The FTSE Paris-Aligned Benchmark (PAB) Indices target a minimum 50% reduction whilst the FTSE Climate Transition Benchmark (CTB) Indices target a minimum 30% reduction in carbon emissions relative to the reference benchmark. The indices combine data and analysis from FTSE Russell and the Transition Pathway Initiative (TPI).
The indices exceed the minimum requirements of the EU Climate Benchmarks Regulation via:
- Targets on increased exposure to companies with Green Revenues, high climate governance and emission reductions that are in line with the goals of the paris agreement
- Exclusions applied to ‘pure play’ (>50% revenues) oil sands, thermal coal extraction and thermal coal power generation companies in both index sub-families
- Limits on weights of companies within the banking sector
The indices are constructed in a way that allows a transparent tilt exposure towards and away from index constituents according to a number of exposure objectives.
A broad offering of global and domestic equity markets – including the well-known FTSE Global Equity Index Series (FTSE GEIS), FTSE UK Index Series, and the Russell US Indices – provide clients with a comprehensive foundation for both their global and local market investing needs.
*Commission Delegated Regulation 2020/1818 of 17 July, 2020, European Commission, 17 July 2020
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