S&P Dow Jones Indices (SPDJI) has created a ‘smart beta’ sustainability index that tracks high income European companies.
The firm says the launch represents an expansion of its smart beta indices that are constructed along environmental, social and governance (ESG) lines.
The index is called the Dow Jones Sustainability Europe Diversified High Dividend Index and has already been licensed to UBS for product development.
It contains 50 companies drawn from the Dow Jones Sustainability Europe Diversified Index.
“We are excited to launch a smart beta ESG index that will allow investors to measure performance of sustainable firms that also have desirable dividend income and tradability characteristics,” says said Tianyin Cheng, an associate director at SPDJI.
Xavier de La Porte du Theil, head of investment strategies structuring at UBS, says investor interest in sustainability is growing and is driven by the “aspiration to make a positive impact and the belief that sustainability has become a factor of performance and risk mitigation”.
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