The Dow Jones Indexes and SAM, a firm that specializes in sustainability investing, have launched a new index aimed at giving investors a broader sustainability benchmark, reports TheStreet.com.
The Dow Jones Sustainability World (DJSIWorld) Enlarged Index will track the performance of 20 percent of the most sustainable companies (PDF) out of the 2,500 largest companies in the Dow Jones Global Total Stock Market Index.
The new index will have 513 components and a market cap of $11.5 trillion, as of November 17, reports TheStreet.com Top holdings include Nestle, Procter & Gamble (P&G), IBM, Johnson & Johnson (J&J) , GE, Chevron, BHP Billiton, Vodafone Group and Novartis.
There also will be a subset index of 459 components that excludes companies from the following sectors: tobacco, alcohol, gambling, armament and firearms, and adult entertainment.
The components for the DJSI World Enlarged are selected according to SAM’s Corporate Sustainability Assessment, which analyzes company performance in terms of economic, environmental and social criteria.
“SAM Indexes has repeatedly received inquiries for a more extensive investment universe from institutional investors managing sustainability portfolios," said Rodrigo Amandi, Managing Director, SAM Indexes, in a statement.
The DJSI World Enlarged complements the Dow Jones Sustainability Indexes family, which has become a reference point for Sustainability Investing since the launch of the first index in 1999, the DJSI World. SAM’s research indicates that a growing number of asset owners are using the DJSI indexes for their investments and more companies define index inclusion as a corporate goal.
The Dow Jones Indexes and SAM released its 2010 annual review of the Dow Jones Sustainability Indexes in September, adding 48 companies to the world’s most sustainable organizations on the DJSI World, while eliminating 46 firms, for a total of 318 companies, or index components.
