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Singapore Exchange (SGX Group) has entered into an agreement with MSCI, a leading provider of critical decision support tools and services for the global investment community, to licence the recently launched MSCI Climate Action Indexes[1] for listed futures contracts. The MSCI Climate Action Indexes include companies that are taking concrete steps to reduce their carbon emissions. Companies are evaluated based upon a range of climate indicators that assess their current carbon intensity and potential to lead in the climate transition, relative to their peers.
As climate investing gains significance, SGX Group recognises the importance of strengthening the ecosystem with relevant solutions to support climate transition. To enhance its current suite of climate products which include Scientific Beta climate indexes, SGX Group will be working with market participants to develop a range of climate-related products including futures contracts to help investors reduce their portfolio carbon footprint.
As a global business and financial hub, Singapore has also grown increasingly in relevance and importance as a regional sustainable finance hub. Singapore is taking actions to do its part to build a sustainable future and is committed to supporting multilateral and public-private cooperation to mitigate climate change.
Loh Boon Chye, Chief Executive Officer, SGX Group, said, “As a leading international exchange in Asia, we have a unique responsibility to lead the market in managing climate risks. We need to quicken the pace of transition and our work with MSCI seeks to address the pressing need for more targeted solutions in the market. Given the growing influence of investors over companies, these indexes coupled with related products in the pipeline will facilitate climate engagement and accelerate the flow of funds to directly support companies in their transition efforts. We will continue to work with all our partners to identify and develop suitable climate-related solutions to meet investor needs.”
Henry Fernandez, Chairman and Chief Executive Officer of MSCI, said, “Through this agreement, SGX Group and MSCI will help the finance and investment industry accelerate progress toward net-zero carbon emissions and a more sustainable future. This industry has a key role to play in reaching net-zero, and MSCI is proud to do our part in making innovative climate tools more widely available.”
The MSCI Climate Action Indexes offer investors a broader choice of solutions to help them meet their net-zero commitments and integrate climate considerations in global equity portfolios.
[1] MSCI launches new climate action indexes for investors seeking net zero transition progress
