Netherlands-based asset manager Robeco has launched three new climate indices: the “Robeco Developed Low-Carbon Climate Leaders Tilt Equities Index,” “Robeco Developed Paris-Aligned Climate Leaders Tilt Equities Index,” and “Robeco Developed Climate Leaders Equities Index.”
In a statement, Robeco said that investors “are increasingly seeking sophisticated climate indices that go beyond reducing backward-looking carbon emissions and incorporate forward-looking, multi-dimensional climate metrics”.
In response, Robeco has developed advanced climate intellectual property (IP) over the years, such as the Climate Traffic Light to assess a company’s alignment with the Paris Agreement, the SDG framework to identify climate solutions and Climate Beta to evaluate climate transition risk. These metrics are integrated into the indices to varying degrees, depending on the specific climate objectives and risk profiles of each index.
The first index offers a low-tracking error alternative to a passive market-cap weighted index, suitable for climate-conscious investors aiming to mitigate climate risk and support companies aligned with the Paris Agreement while obtaining the equity premium.
The second index targets investors who want to meet the minimum requirements for the EU Paris-Aligned benchmark, but are keen to integrate more forward-looking climate metrics and want more exposure to climate solutions providers.
The third index focuses on climate leaders, appealing to investors looking to capitalise on the climate transition by investing in solution providers expected to lead the transition to a low-carbon economy.
Joop Huij, head of Robeco indices, said: “We’re excited to launch this climate index family to offer investors a more nuanced approach to climate index investing, compared to carbon emissions’ focussed indices.
“Our index construction approach takes turnover and liquidity into account to provide highly investable indices. We welcome an active dialogue with clients to develop custom indices that align with their climate and financial goals.”
