Just Inn
Asia’s premier stock exchange – Bombay Stock Exchange (BSE) – is expected to launch its second thematic index, BSE-GREENEX, on February 22, Wednesday. The first being BSE TASIS SHARIAH 50 index, that includes top 50 companies in India that have passed TASIS’s stringent Shariah compliance norms.
The 25th dynamic index at the BSE, the BSE-GREENEX, has been co-developed with gTrade, a domestic sustainability firm working on financial innovations in energy efficiency. While BSE provides the financial analytics, the carbon analytics will be provided by gTrade.
A pick of 20 companies from the BSE 100, the index gives equal weightage to both energy efficiency and profitability – together indicating a long-term sustainable strategy. Further, the index which is created to promote firms working on sustainable business practices is targeted at retail,
as well as institutional investors such as asset managers and pension funds looking for investments in companies with strong long-term prospects and develop green financial products.
Though there are other such indices globally focusing on green credentials, this index is the first which is based on actual performance in the energy efficiency front, rather than stated future plans.
Research over the last three years has shown that this index is performing better than the Sensex, indicating that companies are able to balance energy efficiency and profitability.
The index follows a sector-specific algorithm, whereas in benchmark each company is measured only against the best in the same specific industry based on publically disclosed energy and financial data.
