The University of Cambridge and Bloomberg Index Services are launching the first global corporate bond index to cover fossil fuel producers.

The Bloomberg Cambridge University fixed income index will offer investors the ability to invest across investment grade corporate debt globally through financial products referencing the index.

Cambridge’s methodology to select bond-issuing companies is based on their current corporate behaviour rather than on whether they are classified within a particular industry, such as fossil fuels. This provides for fossil fuel companies no longer undertaking expansion and phasing down in alignment with the Paris Agreement to be included or re-included in the index.

Anthony Odgers, Chief Financial Officer of the University of Cambridge, said, “This is an enormously impactful project which showcases the high-quality research undertaken at Cambridge. The index is a game-changer for the growing number of asset owners who invest in corporate debt and understand its impact on fossil fuel expansion, particularly the construction of new fossil fuel infrastructure such as coal- and gas-fired power plants which risk locking in fossil fuel usage for decades. Once the index launches, the University of Cambridge expects to invest some of its own money against financial products referencing it. This will enable us to align our fixed income holdings with our institution-wide objectives.”

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