• Two new indices launched: FTSE Fixed Income TPI Climate Transition Index and FTSE Fixed Income TPI Focused Glidepath Index.
• Supports climate commitments: Designed for investors aiming to align with the Paris Agreement goals.
• Data-driven approach: Utilizes TPI metrics to evaluate company alignment with climate transition.

FTSE Russell has introduced two innovative indices—the FTSE Fixed Income TPI Climate Transition Index Series and the FTSE Fixed Income TPI Focused Glidepath Index Series—aimed at supporting investors’ climate commitments and advancing sustainability in investment strategies.

FTSE Fixed Income TPI Climate Transition Index Series

The Climate Transition Index integrates a comprehensive set of sustainable investment data, offering a multi-asset approach. It adjusts constituent weights using a fixed-tilt framework based on five climate factors:

1. Carbon emissions
2. Green revenues
3. Green bonds
4. TPI’s Management Quality scores
5. TPI’s Carbon Performance scores

These inputs enable the index to reflect the performance of global and regional fixed income markets while addressing the risks and opportunities associated with transitioning to a low-carbon economy.

FTSE Fixed Income TPI Focused Glidepath Index Series

The Glidepath Index Series takes a long-only investment approach, using a buy-and-hold strategy tailored for corporate bonds. The index redirects proceeds from matured bonds to companies that align with the Paris Agreement by 2050. This strategy aims to reduce tracking error and direct capital flows to entities facilitating a low-carbon transition.

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“FTSE Russell climate indices have evolved to meet the increasing sophistication of sustainable investors,” said Scott Harman, Head of Fixed Income, Currencies, and Commodities at FTSE Russell. “We have seen growing demand for indices that integrate company activity within the green economy and leverage forward-looking metrics.”

These new indices aim to mitigate carbon risk, capture green revenues, and incorporate forward-looking climate metrics, providing a robust tool for investors committed to sustainable growth and compliance with global climate goals.