S&P/ASX 200 ESG Means Resilience for a Better World

The S&P/ASX 200 ESG Index represents S&P DJI’s first core ESG offering for the Australian market. Using a three-step approach, the index seeks to maintain risk/return characteristics similar to those of the S&P/ASX 200 while delivering an improved sustainability profile.
  • Step 1: Exclude companies involved in thermal coal, tobacco and controversial weapons, as well as companies with low UNGC Scores, in addition to the bottom 25% of companies within global GICS industry groups, as ranked by S&P DJI ESG Scores.

  • Step 2: Rank companies by S&P DJI ESG Score. Select top-ranked constituents, targeting 75% of the market cap in each S&P/ASX 200 GICS industry group, with the goal of achieving broadly sector-neutral exposure relative to the S&P/ASX 200.

  • Step 3: Weight companies by float-adjusted market capitalization.


S&P DJI ESG Scores are unique in that they focus on the most financially material and relevant ESG signals within specific industries. The scores leverage industry-acclaimed assessment data from renowned ESG data specialist, SAM, part of S&P Global.


  • Environmental

    Environmental


    10%

    more exposure to companies that integrate climate change risks and opportunities into their risk management programs.

    9%

    more exposure to companies that publicly report their total direct carbon emissions, energy consumption, waste disposed, and water consumption.

    10%

    more exposure to companies that are committed to improving their climate-related performance with science-based targets.

  • Social

    Social


    8%

    more exposure to companies monitoring and disclosing the breakdown of workforce based on minority groups.

    9%

    more exposure to companies assessing human rights issues across their business.

    8%

    more exposure to companies that externally verify their lost-time injury frequency rate for employees.

  • Governance

    Governance


    10%

    more exposure to companies that analyze and address material ESG issues as sources of long-term value creation.

    7%

    more exposure to companies where the board is headed by a non-executive and independent chairperson.

    10%

    more exposure to companies with a public Supplier Code of Conduct that covers working conditions, child labor, and environmental production standards.


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Additional Resources