German indexing firm Solactive AG on Tuesday announced the launch of a new index that allows investors to track and invest in investment-grade green bonds denominated in euros and U.S. dollars.
The firm, which has operated a green bond index since 2014, says its new Solactive green bond EUR USD IG index is the first to focus on investment grade issues that are defined as green bonds by the Climate Bond Initiative (CBI). To be included in the index, an issue must have at least €300 million, or US$300 million, in bonds outstanding, with a maturity of at least 12 months.
Green bonds are typically issued to fund environmental investment, such as the development of projects that address climate change. “This new index launch comes at a time of increased efforts at the national and international levels to channel capital towards environmentally-friendly projects in light of the global challenges brought about by climate change,” Solactive says in a statement.
The new index is also licensed to fund manager, Lyxor Asset Management UK LLP, which will allow investors to gain exposure to the segment.
“Lyxor is proud to be licensed for this index which will provide access to an asset class that we believe will become essential in the very near future,” says Matthieu Mouly, CEO of Lyxor UK LLP, in a statement. “By providing a simple, diversified and robust way to access green bonds, this index allows investors to mobilize their capital towards the enhancement of our environment for the future.”