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Hang Seng Index
BusinessBanking & Finance

Hang Seng Indexes to launch more gauges tracking Hong Kong-listed companies with an environmental, social conscience

  • Investors are increasingly demanding companies have measures to combat climate change, ensure good governance
  • Compiler also plans additional bay area indices as progress to develop the future economic hub gathers pace

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Hang Seng Indexes will offer more gauges tracking companies with good environmental and corporate governance measures, as well as those at the centre of bay area development. Photo: Xinhua
Enoch Yiu

Stock investors will soon be able to track the performance of more Hong Kong-listed companies with a proven track record of environmental and social awareness, under plans by the Hang Seng Indexes Company.

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The compiler is set to launch more indices made up of firms that show commitment to social governance and protecting the environment.

It will also add more gauges to its Hang Seng Stock Connect Greater Bay Area Index Series as progress to develop the future economic and business hub gathers momentum, said Daniel Wong, director and head of research and analytics at the Hang Seng Indexes Company.

“Sustainable investment has become more and more important in recent years. Many institutional investors focus on companies that perform strongly in terms of their efforts to combat climate changes and have good corporate governance,” Wong said.

The promise of new offerings comes after the compiler successfully launched the Nasdaq-like Hang Seng Tech Index, which has quickly become its third most-popular index after the benchmark Hang Seng Index and the H-shares Index. The new tech gauge rose 4.3 per cent last week, after debuting on July 27, thrashing the Hang Seng Index, which edged down 0.4 per cent during the same period.
“The new tech index is popular. We have received many inquiries from issuers of Exchange Traded Fund (ETF), warrants, and other derivatives to ask about licensing the new index to create products,” said Wong.

For the rest of 2020, the compiler will focus on three major areas: promoting more ESG (environmental, social and corporate governance) indices, the Greater Bay Area and what it calls smart beta indices, which consider factors such as volatility, liquidity, quality, value, size and momentum.
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