Hang Seng Index compiler adds another two stock indices to meet demand for sustainable investment
- Both new indices will track the 60-stock Hang Seng Index, with different weightings to reflect the constituents’ varied ESG performance
- Cumulative sustainable fund assets reached US$3.9 trillion at the end of September, making up around 8 per cent of all managed funds
Hang Seng Indexes, the compiler of benchmark indices for Hong Kong’s stock market, has launched two new sustainability indices to tap into growing interest in sustainable investment.
The company Monday announced the addition of the HSI ESG Screened Index and the HSI Low Carbon Index, expanding its family of indices to 16. The additions will be effective as of December 6.
Both new indices will track the 60-stock Hang Seng Index, albeit with different weightings to reflect the constituents’ varied ESG (environment, social and governance) performance in the case of the ESG screen index, and their carbon emission intensity for the low carbon index.
For example, the finance sector has a 39.8 per cent weight in the low carbon index – compared to 34.9 per cent in the Hang Seng Index, while the energy industry’s 1 per cent is less than half the HSI’s 2.3 per cent.
“As sustainable investing strategies continue to gain traction, more investors are incorporating sustainability factors into their investment processes and decisions,” Hang Seng Indexes’ CEO Anita Mo told reporters via videoconference on Monday.
“The new indexes will serve as investible benchmarks for onshore and offshore investors who are seeking to capture investment opportunities arising from the transition to a lower-carbon and greener economy.”