BNP Paribas Corporate and Institutional Banking today announced it has been licensed the Solactive Sustainable Development Goals World Index – a new equity index which enables investors to gain exposure to companies which have been identified as making a significant contribution to the advancement of the United Nations’ Sustainable Development Goals (SDGs). The bank plans to issue structured products tied to the indices later this year.
The United Nations’ SDGs are a set of 17 goals established to guide international cooperation to achieve sustainable development, end poverty and tackle climate change. They were adopted by UN member countries in September 2015 and require active participation from governments, corporations and investors.
The index consists of 50 global companies which have a clear, positive net impact on sustainable development. Eligibility for inclusion is based on Vigeo Eiris’ Equitics© methodology which maps the SDGs against the companies’ products, services and behaviours. Companies for whom sustainable products such as renewable energy or essential medicines represent a significant proportion of activity are eligible. Each company is rated with regards to their impact on people and the planet, and their business practices. For each sector, the leader is included. A further three levels of filtering are embedded into the process: a carbon footprint exclusion filter is applied based on the companies’ carbon emissions and energy transition strategies. Companies with major involvement in disputed activities such as nuclear, tobacco or firearms are also left out, as well as companies involved in critical controversies such as human rights violations. Solactive, the index provider, then applies volatility and diversification filters to reach the final composition.