S&P Dow Jones launches S&P Carbon Price Risk Adjusted index series

By Sarah Lizee

Olympia, Wash., July 17 – S&P Dow Jones Indices announced the launch of the S&P Carbon Price Risk Adjusted index series.

The series seeks to measure the performance of companies in each respective underlying index with a weighting scheme based on estimated company market valuation at risk from predicted 2030 carbon prices, according to a press release.

The indexes are the first of their kind in the market to incorporate potential future carbon prices, specifically the portion of future carbon pricing not covered by any current carbon prices, the release said.

Data on the gap between current and potential future carbon prices is supplied by Trucost’s Corporate Carbon Pricing Tool.

“As the efforts to achieve the commitments of the Paris Agreement and the transition to a low carbon economy progress, future carbon prices could lead to significant increased costs for companies which have not managed their global emissions,” Hannah Skeates, senior director of ESG and Strategy Indices at S&P Dow Jones, said in the release.

“The S&P Carbon Price Risk Adjusted Index Series was developed to help market participants understand the financial risks embedded among the higher carbon emitters of the current global economy.”

The series comprises 12 headline indices, including:

• The S&P 500 Carbon Price Risk 2030 Adjusted index;

• The S&P MidCap 400 Carbon Price Risk 2030 Adjusted index;

• The S&P SmallCap 600 Carbon Price Risk 2030 Adjusted index;

• The S&P Europe 350 Carbon Price Risk 2030 Adjusted index;

• The S&P Global 1200 Carbon Price Risk 2030 Adjusted index;

• The S&P South Africa Composite Carbon Price Risk 2030 Adjusted index;

• The S&P Global LargeMidCap Carbon Price Risk 2030 Adjusted index;

• The S&P Developed LargeMidCap Carbon Price Risk 2030 Adjusted index;

• The S&P Emerging LargeMidCap Carbon Price Risk 2030 Adjusted index;

• The S&P Europe Developed LargeMidCap Carbon Price Risk 2030 Adjusted index;

• The S&P North America LargeMidCap Carbon Price Risk 2030 Adjusted index; and

• The S&P AsiaPac Developed LargeMidCap Carbon Price Risk 2030 Adjusted index.

New York-based S&P Dow Jones Indices is part of McGraw Hill Financial.

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