MUMBAI, June 03, 2014 – Thomson Reuters, the world’s leading source of intelligent information for businesses and professionals, today announced the launch of the Thomson Reuters CRI India 50 ESG Index, the latest addition to the Thomson Reuters Corporate Responsibility Indices. Based on Thomson Reuters proprietary environmental, social and governance (ESG) data, the index will help asset managers attract investments to Indian companies and measure the performance of portfolios that adhere to ESG principles. ICICI Prudential Asset Management Co Ltd., one of India’s largest investment managers, is the first company to license the index.
ESG investing has been gaining traction in recent years due to issues such as environmental awareness surrounding climate change and an increased focus on transparency, risk management and corporate governance. As part of the Thomson Reuters Corporate Responsibility Indices (TRCRI) family launched in April 2013, the India 50 ESG Index will serve as a credible reference for global investors seeking exposure to Indian companies and investment portfolios with ESG standards, while providing Indian asset managers with a useful benchmark for attracting investments from developed markets.
The India 50 ESG Index uses a dynamic rating methodology that factors in the sector breakdown and diversity characteristics of the Indian stock market. It is objective and transparent as it emphasizes quantitative outcomes and scores rather than subjective corporate policy statements. The index is UCITS* compliant, and can be licensed as the basis of an Exchange Traded Fund (ETF) or similar investment product designed to replicate the index, in addition to serving as a benchmark for any actively managed, India-focused ESG fund.
“The launch of the India 50 ESG Index is yet another example of Thomson Reuters core competence in providing innovative and reliable tools to the investment community,” said Sriram Ramnarayan, India country head, Financial & Risk, Thomson Reuters. “Local as well as global asset managers and investors will find this index particularly valuable as the requirement for investments to have certain levels of environmental, social and governance standards increases. The ability to identify opportunities that adhere to these standards will provide an advantage to those investing in emerging markets such as India.”
Karun Marwah, Head of International Business at ICICI Prudential Asset Management said “Though a relatively lesser known concept in India, ESG-based investing is gaining in focus and interest in a few markets in the West. At our end, we have taken a step forward in this regard, by creating a model portfolio around ESG-based investing in Indian stocks, for over four years now. Our intent at this point is to leverage on that knowledge should ESG-related investing pick up momentum in Indian and Asian markets in the future.”
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*UCITS – Undertakings for Collective Investment in Transferable Securities, the main European framework covering collective investment schemes that are suitable for retail investors.