FTSE Group (“FTSE”), the award-winning global index provider, announced that thirteen companies will be added and eight removed from the FTSE4Good Global Index Series following the FTSE4Good September semi-annual review held yesterday.
Review decisions are made by the independent FTSE4Good Index Policy Committee (“Committee”) made up of experts from the fields of responsible investment, fund management, academia and the business community. Additions and deletions are based on environmental and social criteria set out in the FTSE4Good Index Rules.
Additions
Most of the companies added are from the United States and the United Kingdom. As part of the review, new stringent criteria regarding nuclear safety and waste disposal were also introduced for companies involved in nuclear power generation. This is in line with the Committee’s ongoing commitment to replace activity screens with entry criteria that identify companies meeting internationally recognised environmental and social standards. To be included in the index, companies involved in nuclear power generation are assessed on their nuclear safety and waste disposal policies, management systems, disclosure and performance as well as the existing FTSE4Good requirements. Only one company globally, Iberdrola, has met all the requirements for inclusion at this review. The new criteria will also encourage other companies in this sector to improve their practices.
Deletions
Eight companies, including BP, will be removed from the index with the majority coming from Japan and the United Kingdom. The Committee’s decision to remove BP followed consideration of the company’s response to the Gulf of Mexico oil spill, the environmental and social impact and its history of similar incidents. The seven remaining companies were deleted for failing to meet the climate change and human and labour rights criteria.
The table below shows the breakdown of the changes to the FTSE4Good Index by country:
Country |
No of additions |
No of removals |
Germany |
1 |
- |
Italy |
1 |
- |
Japan |
- |
3 |
Spain |
2 |
- |
Switzerland |
1 |
- |
UK |
3 |
3 |
USA |
5 |
2 |
TOTAL |
13 |
8 |
Changes to the Index will take place after the close of the markets on 17 September, 2010.