MSCI develops low carbon indices

Index provider MSCI has launched a series of low carbon indices for investors concerned about the risks of holding stocks with exposure to fossil fuels and carbon emissions.

Two large long-term investors, the Swedish public pension fund AP4 and the French state fund, Fonds de Reserve pour les Retraites (FRR), have already committed €1 billion each to a low carbon index fund, licensed to Amundi. Both investors said that they were looking for a suitable benchmark for the transition to a low carbon economy. Mats Andersson, CEO of AP4, commented, “We are delighted to have contributed, with FRR and Amundi, to the launch of MSCI Global Low Carbon Leaders Indexes, as we see a low carbon investment approach becoming more popular and mainstream. Combined with a carbon footprint disclosure, we are confident that this approach can offer an alternative source of return while working for the public good.”

Yves Chevalier and Olivier Rousseau, members of the FRR executive management board, said: “These low carbon indexes are a promising avenue that can bring about increased awareness among listed companies that carbon is a major issue for a large investor community, for environmental as well as financial risk reasons. We see them as a new, pragmatic and powerful addition to FRR’s climate toolbox.”