Intercontinental Exchange, Inc. (NYSE: ICE), a global provider of data, technology and market infrastructure, recently announced the launch of a suite of corporate bond climate indices “designed to capture the goal of achieving net zero carbon emissions by 2050.”
The indices are part of the ICE ESG Bond Index Family, which “supports the growing demand for responsible and sustainable investing.”
In response to the UN’s Intergovernmental Panel on Climate Change (IPCC), which determined that limiting global warming to 1.5°-2.0° Celsius is the best chance “to avoid the worst consequences of climate change, the European Union (EU) and United Kingdom (UK) agreed to work towards achieving net zero carbon emissions by the year 2050.”
To achieve that goal, the Paris Agreement was signed by 192 countries “plus the European Union to work towards reducing greenhouse gas emissions and limit global warming.”
ICE’s corporate climate indices “leverage 23 of ICE’s corporate bond benchmarks to create a family of 138 climate indices, many of which are labelled as Paris Aligned benchmarks and Climate Transition benchmarks.”
For each benchmark index, ICE has “created six climate variants using different screening and carbon metrics that all target a reduction in the aggregate carbon emissions of constituents to net zero by 2050.”
Varun Pawar, Head of ICE Data Indices, stated:
“The goal of carbon reduction has become a key focus for investors, as they begin to look at not just promises of change, but at actions companies are taking to achieve their emission goals. This new suite of indices brings together several of ICE’s strengths – its leadership role in fixed income securities and global environmental markets, experience creating innovative sustainable benchmarks and ability to deliver products that match investors current and future needs.”
ICE’s ESG bond indices “leverage the company’s existing benchmark bond indices, such as the ICE BofA Fixed Income Indices, to create a broad range of benchmarks that match the growing demand for responsible and sustainable investing.”
These include fixed income sustainable benchmarks that “account for environmental, social and governance (ESG) factors, as well as ICE’s Global Carbon Futures Indices, which serve as benchmarks for the global price of carbon.”
As covered, Intercontinental Exchange, Inc. is a Fortune 500 company that “designs, builds and operates digital networks to connect people to opportunity.”
They provide financial technology and data services “across major asset classes that offer our customers access to mission-critical workflow tools that increase transparency and operational efficiencies.”
They operate exchanges, “including the New York Stock Exchange, and clearing houses that help people invest, raise capital and manage risk across multiple asset classes.”
Their comprehensive fixed income data services and execution capabilities “provide information, analytics and platforms that help our customers capitalize on opportunities and operate more efficiently.”
At ICE Mortgage Technology, they claim to be “transforming and digitizing the U.S. residential mortgage process, from consumer engagement through loan registration.”
Together, they aim to “transform, streamline and automate industries to connect our customers to opportunity.”