FTSE Russell has launched a new data model and index family that tracks the revenue that companies derive from environmentally sound sources.
In a bid to enhance investors’ access to data on corporate sustainability, the index firm has launched a new data model that measures the “green” revenue of 13,400 public companies, representing 98.5% of total global market capitalization. The new model allows tracking of revenue from goods and services that help the world to adapt to, mitigate or remediate the impact of climate change, resource depletion or environmental erosion.
“By incorporating this measure of green revenue exposure, FTSE Russell’s framework provides the first complete picture of the scale and velocity of the structural shift to a green economy across public companies,” the company said in statement. “The model provides the missing dimension of the green transition, providing portfolio managers, research analysts and product managers with consistent, transparent data to track green revenue exposure and support their investment in companies that stand to benefit from the increasing shift in the global economy.”
Additionally, the firm has developed a new index series, the Green Revenues Index Series, based on the new data model. The first 10 indices in the new series will cover the key FTSE and Russell universes. It also will provide the basis for a series of exchange-traded products.
“We identified a significant gap in the ability of portfolio managers to track exposure to the increasing shift toward a green economy,” said Mark Makepeace, chief executive of FTSE Russell. “We calculate that the green opportunity is equitable in size to emerging markets, and the launch of our green revenue data model, and related [indices], provides the missing piece for investors, with a framework that captures the full picture of their green revenue exposure for the first time.”