S&P to develop EU climate index

S&P Dow Jones Indices will develop the S&P ESG Eurozone 60 Bund-SV Index for the German government.

The index will serve as a performance benchmark for four of the government’s Federal Special Pension Funds. S&P says the index incorporates the minimum standards for EU Climate Transition Benchmarks as described in Regulation (EU) 2019/2089 and aligned with the landmark Paris Agreement.

The index uses S&P Global’s ESG Scores to determine eligibility. Index constituents will be selected and weighted to be collectively compatible with a 1.5°C global warming climate scenario and to meet other climate-focused objectives. Companies involved in certain business activities, including those that are not aligned with the principles of the United Nations’ Global Compact and those that are involved in ESG controversies, will be excluded from the index.