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The overall number of investment indices has dropped from last year, led by a contraction in equity indices, reports the Index Industry Association (IIA).

According to the New York-based trade group, there are currently 2.96 million indices globally, which is down by about 20% from last year. The IIA said the decline is primarily due to a large number of equity indices being decommissioned.

“Every firm continuously evaluates their [indices] to see if they are redundant, which helps keep costs down for their clients. Ultimately, our members are focused on providing the quality of [indices] investors demand that they administer and not necessarily the quantity,” said Rick Redding, CEO of the IIA.

Conversely, the number of environmental, social and governance (ESG) indices is up by 13.85% from last year, including both equity and fixed income ESG indices, which the IIA said is fuelled by investor demand for ESG investments.

The number of fixed income indices overall increased by 7.15% from 2018.

“With three years of data to analyze, we can see interesting trends developing in fixed income and ESG,” said Redding.

“Index providers are continuing to expand their fixed income offerings to give investors more accurate benchmarks. Moreover, the number and variety of ESG [indices] indicate that investors are looking for benchmarks that conform to their investment objectives and beliefs,” he added.