FTSE Russell Introduces FTSE MIB ESG Risk-Adjusted Index to Meet Growing Demand for ESG-Focused Market Solutions

FTSE Russell Introduces FTSE MIB ESG Risk-Adjusted Index to Meet Growing Demand for ESG-Focused Market Solutions

(IN BRIEF) FTSE Russell has launched the FTSE MIB ESG Risk-Adjusted Index, which adjusts constituent weights based on ESG and carbon risks, offering a more sustainable alternative to traditional indices. The index focuses on reducing exposure to fossil fuels and companies with poor ESG scores, providing broader access to the Italian stock market with improved ESG characteristics. This new index complements the FTSE ESG Risk-Adjusted Index Series, which was introduced in April 2023.

(PRESS RELEASE) LONDON, 20-Nov-2024 — /EuropaWire/ — FTSE Russell has unveiled the FTSE MIB ESG Risk-Adjusted Index, designed to meet the rising demand for market indices that incorporate Environmental, Social, and Governance (ESG) factors alongside traditional financial metrics. The new index, which adjusts constituent weights to account for ESG and climate-related risks and opportunities, provides investors with enhanced ESG performance while maintaining low tracking error.

The FTSE MIB ESG Risk-Adjusted Index is structured to prioritize companies with higher ESG scores while reducing exposure to those with significant fossil fuel reserves and high carbon emissions. The index also applies a range of exclusions, including controversial weapons, tobacco, thermal coal, oil sands, shale energy, and Arctic exploration. Additionally, companies potentially in violation of the United Nations Global Compact principles are excluded.

Stephanie Maier, Head of Sustainable Investment at FTSE Russell, noted:
“As investors increasingly seek alternatives to traditional market-cap weighted indices, there is a growing demand for products that better reflect ESG risks. This launch addresses that need, offering a straightforward way for investors to access equity market exposure while mitigating key ESG risks.”

This new index provides a more sustainable approach to investing in the Italian stock market, giving investors a way to align their portfolios with ESG and climate-conscious principles. It joins the FTSE ESG Risk-Adjusted Index Series, which was first launched in April 2023, and is a continuation of FTSE Russell’s efforts to provide investors with comprehensive ESG-focused market solutions.

The FTSE MIB ESG Risk-Adjusted Index expands the suite of indices that help investors better integrate sustainability into their portfolios, complementing a range of strategies aimed at reducing exposure to environmental and social risks.

Notes to editors

1 The FTSE ESG Risk-Adjusted Index Series includes the following indices:

– FTSE 100 ESG Risk-Adjusted Index

– FTSE 250 ESG Risk-Adjusted Index

– FTSE 350 ESG Risk-Adjusted Index

– FTSE All-Share ESG Risk-Adjusted Index

– FTSE MIB ESG Risk-Adjusted Index

– Russell 1000 ESG Risk-Adjusted Index

– Russell 2000 ESG Risk-Adjusted Index

– Russell 3000 ESG Risk-Adjusted Index

– Russell 1000 Growth ESG Risk-Adjusted Index

– Russell 1000 Value ESG Risk-Adjusted Index

– Russell Midcap ESG Risk-Adjusted Index

– Russell 2500 ESG Risk-Adjusted Index

About FTSE Russell, an LSEG business

FTSE Russell is a global index leader that provides innovative benchmarking, analytics and data solutions for investors worldwide. FTSE Russell calculates thousands of indexes that measure and benchmark markets and asset classes in more than 70 countries, covering 98% of the investable market globally.

FTSE Russell index expertise and products are used extensively by institutional and retail investors globally. Approximately $15.9 trillion is benchmarked to FTSE Russell indexes. Leading asset owners, asset managers, ETF providers and investment banks choose FTSE Russell indexes to benchmark their investment performance and create ETFs, structured products and index-based derivatives.

A core set of universal principles guides FTSE Russell index design and management: a transparent rules-based methodology is informed by independent committees of leading market participants. FTSE Russell is focused on applying the highest industry standards in index design and governance and embraces the IOSCO Principles. FTSE Russell is also focused on index innovation and customer partnerships as it seeks to enhance the breadth, depth and reach of its offering.

FTSE Russell is wholly owned by London Stock Exchange Group.

For more information, visit FTSE Russell.

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