Euronext enlarges its SBT 1.5°C index offering to accelerate the transition to green finance

• Euronext launches two new SBT indices: Euronext Europe SBT 1.5° and Euronext Eurozone SBT 1.5°, continuing on from the previously launched CAC SBT 1.5° index

• The index was launched with the support of CDP

• These two indices are Euronext’s 27^th and 28^th climate indices

Amsterdam, Brussels, Dublin, Lisbon, Milan, Oslo and Paris – 11 July 2023 – Euronext today announced the launch of two new SBT indices: the Euronext Europe SBT 1.5° and the Euronext Eurozone SBT 1.5° (gross return Bloomberg codes: EZSBT15G and EUSBT15G). These two indices invest solely in companies within the Europe 500 index and within the Eurozone 300 index, respectively, that have emissions reduction targets approved by the Science Based Targets initiative (SBTi) to be in line with the 1.5°C goal of the Paris Agreement.

After the successful launch of the CAC SBT 1.5° in January this year, as well as the launches of the Euronext ESG indices CAC 40^® ESG, MIB^® ESG, AEX^® ESG, OBX^® ESG and BEL^® ESG, the Euronext Eurozone/Europe SBT 1.5 indices will respond to the growing demand for sustainable investment tools from investors and from the market.

The Euronext Eurozone/Europe SBT 1.5° indices are designed to facilitate the adoption of mainstream ESG investment approaches by institutional and private investors while providing a strong focus on climate change considerations:

• Each index first incorporates negative screening and norm-based exclusion filters applied in accordance with the UN Global Compact Principles as well as exclusion screening for companies involved in unconventional oil & gas, coal, controversial weapons and tobacco activities.
• The indices are composed of companies having defined clear targets to reduce greenhouse gas (GHG) emissions in line with 1.5°C, which have been validated by the SBTi.
• The index methodology will evolve to integrate new EU regulations and standards as they emerge.
• Components of both indices are free-float market capitalisation weighted.
• Composition of the indices is revised on a quarterly basis.

Through the 2015 Paris Agreement, world governments committed to limiting the global temperature rise to well below 2°C above pre-industrial levels and pursue efforts to limit warming to 1.5°C. Emissions reduction targets approved by the SBTi represent the gold standard for corporate climate goals. Science-based targets provide a clearly defined pathway for companies to reduce their full value chain emissions in line with 1.5°C and are a necessary first step for companies to achieve net zero in the longer term. The typical SBTi 1.5°C validated company has cut its annual emissions (scope 1 and 2) at a linear rate of 8.8% since setting targets – twice as fast as what is needed.

Stéphane Boujnah, CEO and Chairman of the Managing Board of Euronext N.V.: “The launch of the Euronext Europe SBT 1.5° and Euronext Eurozone SBT 1.5° indices is a first major step towards expanding the family of Euronext’s climate indices, after the successful launch of the CAC SBT 1.5°. This launch demonstrates our strong commitment to our “Fit For 1.5°” and Growth for Impact 2024 strategy. These new climate indices are also a strong contribution to the transition towards responsible investment and to Euronext’s key pan-European leadership role in supporting the allocation of capital to sustainable initiatives in Europe.”

Luiz Amaral, Chief Executive Officer at the SBTi: “The success of and expansion of these indices demonstrate demand for investment opportunities that drive corporate climate ambition and action in line with science. We expect other indices to follow suit – helping to make science-based targets business as usual worldwide.”

Laurent Babikian, Global Director Capital Markets at CDP: “We need all companies across the spectrum to decarbonise emissions across their value chain and have a credible transition plan in place to limit warming to 1.5 degrees. These new indices will enable investors to have exposure to a broader range of companies across the index with approved, science-based 1.5 degree emissions reduction targets. This next step broadens the realm of opportunities for sustainable financial products in the market and to counter greenwashing. We are now well into the decisive decade for action on climate, and it's great to see Euronext extending its commitment to spur action in the financial sector.”

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