Euronext announced the launch of a new suite of ESG-focused products, services and initiatives, designed to provide a robust framework of tools for European capital markets to fuel sustainable growth. The announcement represents a significant step forward in Euronext’s three-year strategic plan, “Let’s Grow Together 2022”, in which ESG was identified as a key strategic pillar.
Introducing new Euronext ESG 80 index and derivatives alongside aligning Europe’s leading Low Carbon 100 index to the Paris Agreement
Euronext has partnered with Vigeo Eiris Moody’s to design a new ESG index, the Euronext Eurozone ESG Large 80, which tracks the Eurozone’s 80 Large Cap companies that are strong on social and governance criteria and are transitioning to a low carbon economy. This new index responds to investors’ need for a public climate action benchmark in the Eurozone.
On 1 June 2020, Euronext introduced its first futures derivatives contracts based on an ESG index. The ESG 80 futures provide effective hedging tools and allow more investors to gain exposure to the sustainable economy in the Eurozone.
Euronext, with its partners CDP, Carbone 4 and Vigeo Eiris Moody’s, also announced that Europe’s oldest low carbon index, the Low Carbon 100, is now aligned with the current draft of EU regulation on low carbon benchmarks in conformity with the Paris Agreement objectives, whose framework is to be officially adopted later this year. Through Exchange Traded Funds provided by BNP Paribas, the index provides investors with a ready-to-use tool to support the environmental objectives required by the Paris Agreement i.e. a 7% year-on-year reduction of CO2 emissions, a limit of 1.5°C global temperature rises by 2050 and exclusion of fossil fuel companies.
Euronext currently provides clients with a comprehensive range of over 40 ESG index families based on a transparent and rules-based selection process, with input from expert partners in their fields such as Carbone 4, CDP, ISS-ESG and Vigeo Eiris Moody’s.
Expanding Euronext Green Bonds to ESG Bonds
Capitalising on the success of the Euronext Green Bonds offering introduced last November, with almost 70% increase in the number of issuers since launch, Euronext is expanding this offering to other ESG-related bonds, including blue, social, sustainability and sustainability-linked bonds. Euronext is the only exchange consolidating ESG bonds listed in multiple locations onto one highly visible section, thus providing a means for issuers to showcase their ESG credentials and for investors to rapidly identify ESG bonds. To date, 231 ESG bonds from 95 issuers are featured on the new Euronext ESG Bonds section.
Euronext is the world’s number one bonds listing venue and has over €165bn of ESG bond issuances listed on its markets. €54.3bn of green bonds were listed on Euronext last year and represented almost one-fifth of global green bonds issued in 2019.