TOKYO -- Nikkei Inc. announced Monday that the company will start calculating and publishing the Nikkei 225 Climate Change 1.5°C Target Index, which will become publicly available starting May 30.
The index will be the most advanced example of its kind in Japan, complying with the index regulations of the European Union aimed at attaining the goals of the Paris climate accord. The index is to halve the total greenhouse-gas emissions of the Nikkei 225 by adjusting the number and weight of constituents.
The index was developed with U.S. investment technology and advisory company Wilshire. Of the 225 constituents, Nikkei will start calculating the index with 204 components, excluding companies that generate more than a certain amount of their revenues from fossil fuels. The weight of each constituent will be adjusted by increasing or decreasing based on greenhouse-gas emissions so that such emission levels will be further decreased by 7% annually in the coming years.
The Paris climate accord stipulates limiting global temperature increases to 1.5 degrees above pre-industrial levels. Stock indexes complying with the EU Paris-aligned Benchmarks are gaining popularity among green-minded investors, as they reflect the movements of market value of environment-conscious companies.
For more details, please visit the Nikkei indexes website.