AUTHORS
Jaakko Kooroshy
Head of SI Data &
Methodologies, ISD
+44 0 7557 782101
jkooroshy@
Lily Dai
Senior SI Research Lead, ISD
+44 0 7890 382666
@
Lee Clements
Head of SI Solutions, ISD
+44 0 207 797 3812
lclements@
Overview
The greening of the global economy presents significant opportunities to investors.
However, investors and policymakers face a common challenge: How can green
business activities be systematically identified, categorized, and measured across
diverse sectors, supply chains and asset classes to mobilize investment at scale?
The EU Taxonomy is an ambitious regulatory initiative that aims to address this
challenge. However, while the EU Taxonomy will set out a catalogue of green
criteria, it leaves it to markets to assess individual companies against these criteria.
Yet in their current form, corporate disclosures are typically insufficient—FTSE
Russell research has found that less than 30% of companies with green revenues
provide disclosures that are granular enough to allow investors to systematically break
out and quantify companies’ green business activities.
The research paper explains the need for green taxonomies, summarizes the
development of and approaches taken by the EU Taxonomy and the FTSE Russell
Green Revenues Classification System (GRCS), and examines the overlaps and
points of difference between the two approaches. Crucially, it explains how GRCS
dataset can provide a steppingstone for investors to comply with the requirements of
the EU Taxonomy regulation.
Market Navigation
Sustainable Investment | Green Revenues
Sizing the green economy:
Green Revenues and the
EU taxonomy
September 2020
mailto:jkooroshy@
mailto:@
mailto:lclements@
1
Acknowledgements
The authors would like to thank the following individuals for reviewing the paper and providing their
valuable insights and suggestions: Nathan Fabian (UN PRI), Helena Viñes Fiestas (BNP Paribas Asset
Management), Maurice Versaevel (PGGM), Eric Borremans (Pictet Asset Management), Silvio Corgiat
Mecio (LGIM), Anna Creed (Climate Bonds Initiative), Bruce Jenkyn- Jones (Impax Asset Management)
and Ana Harris (SSGA); as well as the members of the FTSE Russell Green Industries Advisory Committee.
All errors and omissions remain the authors.
David Harris, Aled Jones, Sara Lovisolo and Anoushka Babbar, at FTSE Russell and the London Stock
Exchange Group also made valuable contributions.
Table of contents
Executive summary 4
Section 1: Sizing the sustainable finance opportunity 5
Section 2: The EU Taxonomy 8
Disclosure obligations 9
Section 3: FTSE Russell’s Green Revenues Classification System (GRCS) 11
Section 4: EU taxonomy in practice 15
Measuring EU taxonomy alignment with FTSE Russell Green Revenues data 15
Appendix 1: Case studies 18
Case study 1: General Electric (GE) 18
Case study 2: Corning Incorporated 20
Case study 3: 21
Case study 4: Total 22
Appendix 2: Mapping FTSE Russell GRCS and EU taxonomy 24
Executive summary
The greening of the global economy—in response to the threat of climate change and other environmental
challenges—presents myriad opportunities to investors. However, investors and policymakers face a
common challenge: How can green business activities be systematically identified, categorized, and
measured across diverse sectors, supply chains and asset classes to mobilize investment at scale?
The EU Taxonomy is an ambitious regulatory initiative that aims to address this challenge. The Taxonomy
report (first published by the EU Technical Expert Group on Sustainable Finance in June 2019 and updated
in March 2020) sets out detailed criteria for 72 economic activities that make a significant contribution to
climate change mitigation and 70 to adaptation (for now covering two of the EU’s six environmental
objectives1).
The legal basis for the Taxonomy classification, the EU Taxonomy Regulation creates additional legal
disclosure obligations that are scheduled to come into force from January 2022:
c. 6000 large EU companies subject to the EU Non-Financial Reporting Directive (NFRD) will be
required to disclose whether, and to what extent, their activities are Taxonomy-aligned, in terms of
turnover, capex or opex; and
Providers of financial products, offered in the EU, that pursue sustainable investment or promote
environmental characteristics must demonstrate how they have used the Taxonomy and the proportion
of underlying investments that are Taxonomy-aligned.
Investors face a considerable practical challenge in meeting these requirements. While the EU Taxonomy
will set out a catalogue of green criteria, it leaves it to markets to assess individual companies against these
criteria. Yet FTSE Russell research shows that currently less than 30% of companies with green revenues
provide disclosures that are granular enough to allow investors to systematically break out and quantify
companies’ green business activities. These disclosures will improve over time, but this process is likely to
be gradual, particularly for non-EU companies.
In the meantime, rigorous estimates that can supplement disclosed data will have to play a key role in
determining green revenues for individual companies; and to provide investors with robust datasets to
measure the degree to which investment products and portfolios are aligned with the EU Taxonomy.
FTSE Russell’s Green Revenues data provides investors with a highly granular dataset for assessing over
16,000 stocks for their exposure to green business activities. The data is based on FTSE Russell’s Green
Revenues Classification System (GRCS) 2, now covering 10 green sectors and 133 green micro-sectors. This
classification system builds on earlier versions that have been used to track leading companies in the green
economy for indexes since 2008.
The EU Taxonomy and the GRCS are highly aligned on core activities, providing investors with an effective
and transparent tool to assess the exposure of equity portfolios to revenues from EU Taxonomy aligned
activities, in a granular and accurate manner.
This paper explains the need for green taxonomies, summarizes the development of and approaches taken by
the EU Taxonomy and the GRCS, and examines the overlaps and points of difference between the two
approaches. Crucially, it explains how the GRCS dataset can provide a steppingstone for investors to comply
with the requirements of the EU Taxonomy regulation.
1 See Section 2 for details.
2 The initial FTSE Environmental Market Classification System was developed by FTSE Russell in collaboration with Impax Asset
Management and based on a precursor of the GRCS, the Environmental Markets Classification System (EMCS).
4
Section 1: Sizing the sustainable finance opportunity
The emerging green economy is perhaps the defining opportunity of the 21st century. The investment
required to decarbonize the global economy and address other environmental challenges will be enormous.
To address climate change alone, $90 trillion of capital will need to be invested by 2030, according to the
New Climate Economy, a body co-chaired by Lord Nicholas Similarly, the European Commission
estimates that the bloc alone will have to invest an additional €175-€290 billion each year to reach net-zero
emissions by
Investors are increasingly seeking to identify the opportunities associated with this shift to the green
economy. The green investment theme has emerged over the last two decades as awareness has grown
of the sustainability challenges and constraints faced by the global economy. In 2019, inflows from US
investors into sustainability funds reached a record $21 billion—four times the levels of 2018,
according to Morningstar
Meanwhile, green economy companies have been growing as policy and regulation become more
supportive and consumers are increasingly concerned about environmental impacts. Over the past five
years (2015-2020), the FTSE Environmental Opportunities All Share Index, where constituents are
companies that generated at least 20% of their revenues from green products or services, has outperformed
its benchmark, the FTSE Global All Cap, by %.6
Figure 1: Performance of companies with at least 20% green revenues
800
700
600
500
400
300
200
100
0
FTSE Global All Cap Index - Oil & Gas FTSE
Environmental Opportunities All Share FTSE
Global All Cap
Source: FTSE Russell as of August 2020. Past performance is no guarantee of future results. Please see the end for important
legal disclosures.
3 The New Climate Economy (2018), The 2018 Report of the Global Commission on the Economy and Climate, Executive Summary
4 A Clean Planet for all - A European strategic long-term vision for a prosperous, modern, competitive and climate neutral economy.
5 Chris Flood (2020), Record sums deployed into sustainable investment funds
96b36e597cfc.
6 Compound annual return over five years. Source: FTSE Russell as of 31st August 2020.
In
de
x
V
al
ue
Ja
n-
20
03
Se
p-
20
03
M
ay
-2
00
4
Ja
n-
20
05
Se
p-
20
05
M
ay
-2
00
6
Ja
n-
20
07
Se
p-
20
07
M
ay
-2
00
8
Ja
n-
20
09
Se
p-
20
09
M
ay
-2
01
0
Ja
n-
20
11
Se
p-
20
11
M
ay
-2
01
2
Ja
n-
20
13
Se
p-
20
13
M
ay
-2
01
4
Ja
n-
20
15
Se
p-
20
15
M
ay
-2
01
6
Ja
n-
20
17
Se
p-
20
17
M
ay
-2
01
8
Ja
n-
20
19
Se
p-
20
19
M
ay
-2
02
0
However, accurately identifying and measuring the exposure of companies to green products and services
across large investment universes is a challenging task. Conventional business classification frameworks,
for example ICB7 or GICS8, rarely distinguish between environmentally friendly and environmentally
damaging products. There is also a lack of granularity to capture nuances of emerging green products and
services in a wide range of sectors.
In addition, the lion share of green economic activity is undertaken by firms that combine both green and
non-green products and services (such as industrials)—and very few of these report on the proportion of
their business that is directed towards the green There are of course a growing number of
“pure play” green companies (such as wind turbine manufacturers, or electric vehicle companies), which
only account for a small portion of the green economy.
Such challenges notwithstanding, there is a clear benefit in finding common taxonomies or a common
classification system to describe the green economy. Global financial markets rely on such common
language to be able to identify green investment opportunities and measure the associated growth and
performance. Crucially, this enables investors to direct capital to these opportunities, and it facilitates the
creation of indexes and financial products through which capital can be deployed at scale. In addition, they
encourage corporate disclosure. Recognizing the growing number of investors looking to allocate capital to
the green economy, companies will seek to set out how their activities are aligned.
As policy makers identify ways to promote the green economy and increase investment flows into the low-
carbon transition, the provision of such classifications has also emerged as a policy priority – not least as a
yardstick to track the success, or failure, of the wider suite of green policies. For example, over the last two
years, the European Commission has been working on the EU Taxonomy to define sustainable economic
activities. Chinese regulators have created the Green Bond Endorsed Project Catalogue in 2015,
demonstrating what is green, specifically for its green bond Other countries such as the UK,
Canada, Japan and Malaysia are also exploring potential taxonomies for sustainable finance. The EU has
also set up an International Platform on Sustainable Finance to strengthen international cooperation on
taxonomies, disclosures, standards and labels.
This paper describes two of the most developed systems: the recently proposed EU Taxonomy for
sustainable activities, based on the report of the EU Technical Expert Group on Sustainable Finance; and
FTSE Russell’s Green Revenues Classification System (GRCS), which has been incrementally developed
under the oversight of an independent global advisory committee for over a decade. It looks at how these
two systems identify green products, services and economic activities, and how to use the GRCS to assess
associated revenues and demonstrate EU Taxonomy alignment. The paper also provides case studies on
General Electric, Total, Corning and .
7 Industry Classification Benchmark (ICB) is a globally utilized standard for the categorization and comparison of companies by industry and sector. It is
the official sector classification used across FTSE Russell indexes. benchmark-icb
8 The Global Industry Classification Standard (GICS®) was developed by S&P Dow Jones Indices and MSCI to provide accurate, complete and standard
industry definitions.
9 FTSE Russell (2018), Investing in the global green economy: busting common myths green-
economy-busting-common-myths
10 In June 2020 a consultation was launched on the consolidation of the Catalogue developed by the People’s Bank of China, together with the National
Development and Reform Commission and the China Securities Regulatory Commission.
Box 1: Sustainable Investment, Green Revenues and ESG
FTSE Russell defines Sustainable Investment as any investment approaches that explicitly and
meaningfully take sustainability considerations and data into account as part of the investment
process. This could be based on corporate ESG ratings, but also can include many other types of
metrics, ranging from screenings for controversial products or “green revenues” to carbon data or
diversity metrics.
Similar to the proposed EU Taxonomy, FTSE Russell Green Revenues Data aims to identify the green
attributes of products, services and economic activities, . what does the company do (such as
renewable energy generation); whereas the ESG data model measures a wide range of non-financial
factors (such as exposure to climate change, bribery and corruption, and labor relations) that can be the
source of material investment risks and opportunities during business operations, . how the company
is operating.
Section 2: The EU Taxonomy
To achieve the Paris Agreement on Climate Change and
the UN’s Sustainable Development Goals, the European
Commission has established the EU Taxonomy as part of its
Action Plan on Financing Sustainable The
Taxonomy identifies sustainable economic activities in
consideration of the EU’s six environmental objectives, with an
underlying goal of encouraging sustainable investment and
directing capital towards a green economy. It is also an
important enabler of the “European Green Deal,” an ambitious
set of EU sustainable economy
The EU Taxonomy Regulation (published in June 2020)
identifies six environmental objectives that the Taxonomy will,
ultimately, capture. These are:
1. Climate change mitigation
2. Climate change adaptation
3. Sustainable use and protection of water and marine
resources
4. Transition to a circular economy, waste prevention and
recycling
5. Pollution prevention and control
6. Protection of healthy ecosystems
Starting from the climate change mitigation objective, the
TEG has adopted a top-down process, first identifying priority
sectors (using the NACE industry classification system14) in
terms of the size of their emissions, or where they have the
potential to enable substantial reductions. It then identified
potential activities, within each sector, that can make a
significant contribution to mitigation. For each of these, it
provides technical screening criteria – emissions thresholds
from energy generation, or emissions reduction trajectories for
livestock production, for example. The Taxonomy report
provides a list of 72 economic activities with substantial
contribution to mitigation.
For the climate change adaptation objective, the TEG
proposed three principles to define activities with substantial
contribution to adaptation. These activities are required to:
reduce all material physical climate risks to the extent
possible; not adversely affect adaptation
Box 2: The EU Taxonomy Development Process
In December 2016, the EU High-Level Expert Group (HLEG)
on Sustainable Finance was established. Its final report,
published in January 2018, formed the basis of the EU’s Action
Plan on Financing Sustainable Growth, and the first of its key
recommendations was to “establish and maintain a common
sustainability taxonomy at the EU level”.
In March 2018, the European Commission passed the Action
Plan; and it created the Technical Expert Group (TEG) in May.
The TEG was made up of 35 members from civil society,
academia, business and finance. It was mandated to make
recommendations for the Taxonomy.
In June 2019, the TEG published its first technical report on the
Taxonomy, which explains its conceptual approach, the
underlying methodology, technical screening criteria for climate
change mitigation activities (environmental objective 1), use
cases and expected economic impacts.
In December 2019, the European Council and the European
Parliament reached political agreement on the EU Taxonomy
Regulation, meaning that its provisions will come into force at
the end of December
In March 2020, TEG’s final report was published with
additional details on the proposed climate change adaptation
criteria (environmental objective 2), and guidance on what
companies and financial institutions can disclose to demonstrate
EU Taxonomy alignment.
The European Commission is currently working on the
development of the delegate acts supporting the regulation, which
will set out the criteria for objective 1 and 2 and are expected to
be published by December 2020. The Commission is also seeking
to establish a Platform on Sustainable Finance, which takes over
from TEG, to provide criteria on environmental objectives 3-6 for
an extended Taxonomy.
Representatives of FTSE Russell and London Stock
Exchange Group participated as members of both the
HLEG and the TEG.
11 European Commission (2020).
12
13 European Commission (2020). TEG Final Report on the EU Taxonomy
14 NACE (Nomenclature générale des Activités économiques dans les Communautés Européennes) is an industry classification system used in the European Union to
collect and present statistical data on economic activities such as production, employment and national accounts. The use of NACE is mandatory within the European
Statistical System.
Box 3: Compliance with the Proposed EU Taxonomy
To qualify as “environmentally sustainable” under the proposed EU Taxonomy, an activity must
meet all three requirements below:
1. Make a substantial contribution to one of the six environmental objectives (such as
mitigation or adaptation activities discussed above);
2. Do no significant harm (DNSH) to the other five environmental objectives;
3. Meet minimal social safeguards (aligning with the OECD Guidelines on Multinational
Enterprises, the UN Guiding Principles on Business and Human Rights, and ILO
Conventions on Labor Standards)
efforts by others; and have adequate indictors to demonstrate adaptation-related outcomes. The Taxonomy
report includes 70 economic activities with substantial contribution to adaptation, 68 of which are also
activities with substantial contribution to mitigation.
The TEG has stressed that the technical report is not the last word on the screening criteria. The proposed
criteria will be reviewed by the Commission for inclusion in draft Delegated Acts supporting the
regulation, which will be opened to consultation with stakeholders. The final Delegated Acts covering
objectives 1 and 2 are expected to be published by December 2020.
The criteria established through the delegated acts are also expected to be subject to periodic revisions,
and further criteria will be developed for activities contributing to the other four environmental
Disclosure obligations
To drive the adoption of the Taxonomy, the EU Taxonomy Regulation imposes a number of obligations on
companies that offer investment products for sale within the EU, and on companies within scope of the EU
Non-Financial Reporting Directive (NFRD). These obligations are phased in from 2022 onwards, with full
applicability by 2023.
Financial and non-financial companies that are required to report information under the scope of the EU’s
Non-Financial Reporting Directive (NFRD) will have to disclose whether, and to what extent, their activities
are associated with environmentally sustainable economic activities. These disclosures should include the
proportion of their turnover, capital expenditures (capex) and operational expenditures (opex) that are aligned
with the Taxonomy. The regulation applies to around 6,000 large companies and groups across the
Financial market participants, who offer financial products in the EU that are intended for environmentally
sustainable investments, or that promote environmental objectives, will be required to disclose how, and to
what extent, the underlying investments support economic activities that are aligned with the EU Taxonomy.
This includes disclosures on the environmental objective(s) to which the underlying investments contribute,
and the share of investments that are aligned with the EU Taxonomy. Turnover, capex and opex associated
with Taxonomy-aligned activities can be used to calculate the proportion of underlying investments that are
Taxonomy-aligned. 17
15 The final Delegated Acts for environmental objective 3-6 will be published by December 2021.
16
17 European Commission (2020).
Other financial products will need to state that “The investments underlying this financial product do not
take into account the EU criteria for environmentally sustainable investments.”
We expect that regulations surrounding disclosure against the Taxonomy will over time generate much
greater volumes of data—and higher quality data—about sustainable economic activity.
This data will facilitate more sophisticated analytics that will help investors anticipate and respond to
emerging trends in the green economy. In turn, these will help to inform policymakers as they seek to
encourage investment that facilitates the transition to sustainable global economy.
However until companies globally, not only those in the EU, provide full transparency on the extent to
which taxonomy-aligned activities contribute to their revenues and capital expenditures, it will prove
challenging to precisely measure the green exposure of global investment portfolios and calculate the size
of the green The requirement for related disclosure by companies covered by the EU’s Non-
Financial Reporting Directive will, over time, address this issue (at least for companies covered by the
NFRD), but it is likely to take time for standardized disclosures to emerge. Investors must, therefore,
choose datasets that provide the best proxy to measure alignment with the EU Taxonomy.
18 See more details
Section 3: FTSE Russell’s Green Revenues
Classification System (GRCS)
FTSE Russell’s Green Revenues Classification System (GRCS) was created to help investors and financial markets
to better identify companies with green products and services, track their performance and facilitate the
construction of financial products that seek exposure to such companies.
It offers a practical solution to the challenges that financial market participants face in complying with the EU
Taxonomy Regulation. Indeed, in undertaking its financial impact assessment of the Taxonomy, the Joint
Research Centre of the European Commission used the FTSE Russell Green Revenues data to estimate the share
of financial investments that are currently funding EU Taxonomy-eligible
The GRCS identifies green products and services across the whole value chain covering 10 green sectors, 64
subsectors and 133 micro sectors (see Figure 2), based on seven environmental objectives—all six
environmental objectives set by the European Commission, plus “sustainable and efficient agriculture.”
Figure 2 The Green Revenues Classification System
19 European Commission Joint Research Centre (2019), The EU Sustainability Taxonomy: a Financial Impact Assessment
The GRCS is developed with guidance and input from the FTSE Russell Green Industries Advisory Committee20,
consisting of senior and leading expert members from the investment community, ensuring that the classification
system follows best practice and addresses market needs.
Over 16,000 equities across 50 developed and emerging markets are assessed and categorized against the GRCS as part
of the FTSE Russell Green Revenues dataset. Approximately 3,000 of these companies are identified as being engaged
in providing green products and services. For these companies, the Green Revenues dataset provides a detailed
breakdown of green activities and associated revenues, as well as an overall company green revenue estimate. This is
compiled through a thorough research process in a series of steps
1. Semantic screening.
The first stage is an automated “big data” step. Keywords based
on the GRCS such as “biofuel” or “electric vehicles” are being
used for automated screening of corporate disclosures to
identify companies involved in green business activities. Any
companies with matches are then verified by analysts for actual
involvement in products or services that qualify under the
GRCS.
2. Business segments identification.
For those companies, where involvement of green products or
services is confirmed, the company-reported business segments
are analyzed and microsectors under the GRCS classification
are attached to the relevant segments. In this process, analysts
will also assess each reported segment to determine whether it
contains: (a) no green activities; (b) a mix of green and non-
green activities; or (c) only green activities. This provides the
basis for determining minimum green revenues (=revenue from
category c segments) and maximum green revenues (=revenue
from category b and c segments) for each company, which are
directly based on corporate disclosures.
3. Micro-sector breakdown.
For the lion’s share of companies with green revenues, public
disclosures will be insufficient to determine exact revenues
from individual types of green business activities (green ‘micro
sectors’). This is because revenue segments reported by
companies typically aggregate multiple green activities (say
‘renewables’ comprising wind, solar and biomass), or both
green and non-green business activities (say ‘power generation’
consisting of gas, solar and hydro power). This prevents not
only a granular revenue breakdown across green activities, but
in many cases makes it difficult to establish the overall green
revenue for a company.
20 FTSE Russell Green Industries Advisory Committee (formally the ‘FTSE Environmental Markets Advisory Committee’) includes members of the global
investment community, including asset managers and banks, as well as technical experts in environmental industries. The Committee is currently chaired
by Jack Ehnes, CEO of CalSTRS, and includes, or has included members with expertise from Aberdeen Standard Investments, GIC, Joint US-China
Collaboration on Clean Energy, Jupiter Asset Management, Morgan Stanley, PGGM, Pictet Asset Management, the World Bank and USS Investment
Management. The Committee has played an critical role in shaping this work and been meeting twice a year to incrementally develop the classification
system since FTSE’s work in this area began in 2007.
Box 4: Example − Green Revenues from
General Electric
The industrial multinational General Electric
(GE) categorizes its business into eight
segments and reports revenues.
Revenues from renewable energy and lighting
segments, which fully qualify under GRCS, and
separately disclosed revenue from locomotives
manufactures (%) in the transportation
segment, result in GE’s % minimum green
revenue. By adding the full revenue from the
power and transportation segments (which
contain both green and non-green activities) the
maximum green revenue is established at
%.
Information such as technology types, numbers
of product lines and revenues at acquisition are
then used to estimate green revenues from the
power and transportation segments at % and
%, respectively. Adding this to the revenue
from the fully green segments yields the more
precise company-specific green revenue
estimate of % (see Appendix 1 for more
details).
Because all of GE’s activities that qualify under
the GRCS are also eligible under the EU
Taxonomy, this also represents the estimate of
GE’s EU taxonomy-aligned revenue (see
Section 4).
In these cases, further research is required to break down the revenues associated with each business
segment to obtain revenues associated with each green micro sector and to establish their share in the
company’s overall revenues. FTSE Russell achieves this through:
Requests for supplementary disclosure. All companies are engaged directly by FTSE Russell to
verify the green revenue assessment, and, where required, are asked to confirm the breakdown of
revenues by green activity and the overall green revenue.
Company-specific estimates. Where companies provide limited revenue disclosures and do not
respond to the request for disclosure, analysts will identify additional data, such as non- revenue data
(. production volumes) and/or relevant market or peer data (such as market share of a product) that
can form a reasonable basis for estimating revenues from each green micro sector.
Sector-specific estimates. For companies, where limited additional information is available to generate
robust company-specific estimates, a quantitative model is used to estimate green revenues using
reported data from sector peers (an approach akin to carbon emissions models). The model uses data
input from disclosure and company-specific estimates to extrapolate green revenues at sector level. The
green revenue of a specific company depends on the sector in which the company operates.
In all three cases, the resulting data is triangulated against the minimum and maximum green revenue data
established during the business segment identification, to ensure robust estimates are built on publicly
available corporate disclosure.
As corporates begin to make more detailed disclosures on green revenues—currently less than 30% of
companies with green revenues provide disclosures (either as part of public filings or on request) that are
granular enough to identify their green revenues—the role of estimated data in measuring green revenues
will decline over time. The new mandatory disclosures for EU companies are likely to be an important
catalyst for such disclosures.
However, disclosure improvements are likely to be gradual, and estimated green revenue data will play a
critical role for investors in coming years – not only in enabling investors to allocate capital to green
investment opportunities at scale, but also in reporting on green revenues and complying with the
reporting requirements under the EU taxonomy.
EMCS GRCS GRCS
Thematic, green
focus across
7 Sectors
Wider range of activities 8
Sectors
Expanded set of activities
– 10 Sectors,
providing comprehensive
EU Taxonomy alignment
Minimum revenue
threshold (20% or 50%)
No minimum revenue
threshold
Green Tiering covering
all 6 EU objectives
Singular use case: index /
benchmark construction
(FTSE Env.
Markets)
Wider range of use cases
Transparent estimation
model to improve revenue
data accuracy
Core use cases include
compliance with EU
Sustainable Finance
objectives
Box 5: GRCS − A Decade of Evolution
The roots of the GRCS stretch as far as 2008 when FTSE Russell and the Impax Asset Management
launched the Environmental Markets Index The collaboration between FTSE Russell and
Impax continues today. The initial Environmental Markets Classification System had a thematic focus
on sectors including clean energy, energy efficiency, water and waste management and were assessed
and included in the index family based on revenue
On this basis, FTSE Russell created the GRCS in 2013 that offered a wider scope and improved
granularity. It provided a broader view of what could be considered green and therefore catered to a
wider range of use cases including portfolio monitoring and reporting, portfolio construction and
benchmarks.
The latest iteration of the classification system, GRCS , was launched in September 2020. It takes a
broad, bottom-up view of the green economy, capturing products and services across the whole value
chain. These products and services are analyzed based on their impact on climate change mitigation and
adaptation, water, resource use, pollution, and agricultural efficiency, which are well aligned with the
EU’s environmental objectives.
2008 2013 2020
21
22 Companies are required to have at least 50% of their business derived from environmental markets and technologies to be eligible for the FTSE
Environmental Technology Index Series; at least 20% of their business derived from environmental markets and technologies to be eligible for the FTSE
Environmental Opportunities Index Series.
Section 4: EU taxonomy in practice
Measuring EU taxonomy alignment with FTSE Russell Green
Revenues data
FTSE Russell’s Green Revenues data provides a granular, robust and transparent solution to assess and
report on EU Taxonomy alignment for individual companies, investment products and broader portfolios.
While not identical, the proposed EU Taxonomy and FTSE Russell’s Green Revenues Classification System
are broadly similar in structure and highly aligned on core activities, giving investors an effective tool to
conveniently identify companies involved in the green economy and quantify the share of their revenues
that is likely to qualify under the proposed EU Taxonomy.
Although the GRCS is somewhat broader because it addresses environmental objectives that are not yet
covered by the EU Taxonomy (such as waste management and pollution control solutions) in its current
form based on the TEG report, its modular structure allows to exclude these elements from the calculation
of EU Taxonomy-aligned revenues. Figure 3 schematically illustrates the process and Appendix 1 provides
four case studies for General Electric, Corning Incorporated, and Total, showing how we
identify revenues under the GRCS and measure EU Taxonomy alignment respectively.
Figure 3 Demonstrating EU Taxonomy-aligned Green Revenues
To identify the EU Taxonomy-aligned GRCS micro sectors, a mapping of the sustainable economic
activities under the EU Taxonomy and the micro sectors covered by the FTSE Russell GRCS has been
undertaken (see Appendix 2 for details).
This mapping demonstrates that GRCS is much broader than the EU Taxonomy and therefore
encompasses all the main sustainable activities covered by the EU Taxonomy. Core green economy
activities that account for the lion’s share green revenues − such as renewable power generation, low
carbon transport or green buildings – are unsurprisingly eligible under both the EU Taxonomy and the
GRCS as they are making substantial contribution to climate change mitigation.
There are a number of activities that are covered by the GRCS but currently not captured by the EU
Taxonomy, notably several activities related to water, waste and pollution control. This is mostly due to the
fact that the current version of the EU Taxonomy has not yet covered all six of their environmental
objectives. It is limited to economic activities, making substantial contributions to climate change mitigation
or adaptation, and does not yet capture other environmental objectives such as pollution control.
The GRCS also includes some activities that are related to the green economy but are simultaneously
associated with potential environmental challenges (. nuclear power generation or lithium mining).
These activities are captured by the GRCS as ‘Tier 3’ activities to give investors flexibility in how they
want to consider these revenues but are currently not eligible under, or covered by the EU Taxonomy
report.
In both cases, green revenues associated with these non-compliant activities are excluded by FTSE
Russell from the calculation of EU Taxonomy-aligned revenues.
Some activities, though covered by both the proposed EU Taxonomy and the GRCS, are considered
with slightly different environmental objectives in mind. For example, the GRCS considers organic food
producers and distributors green because organic farming takes account of the impacts on the broader
ecosystem (. climate change, soil fertility, waste & pollution and animal welfare), which is more
environmentally friendly compared to non-organic farming This is aligned with the EU’s
environmental objectives of climate change mitigation, biodiversity & ecosystem, and pollution prevention
and control. However, the approach to agriculture under the currently proposed EU taxonomy only focuses
on the environmental objective of climate change mitigation, including land management and carbon
sequestration (covered by the “Growing of Perennial/Non-perennial Crops” activity).24
FTSE Russell includes these activities in the calculation of EU Taxonomy-aligned revenues, because
the vast majority of revenues associated with these activities is likely to qualify under the Taxonomy,
even if they are captured under a slightly different rationale in the GRCS.
A limited number of carbon-intensive activities25—including . the production of cement, livestock,
aluminum or plastics—can under certain circumstances qualify under the EU Taxonomy based on the
TEG report, which allows revenues from such activities to be captured if companies can demonstrate that
these activities meet stringent, “best-in-class” environmental performance criteria.
The bulk of such revenues are likely to be captured under GRCS as part of recycled materials
. for plastics or aluminum. In practice, it will be difficult to meet the EU environmental
performance criteria in the production of virgin materials, except in some instances (. aluminum
produced using exclusively hydropower). So far, our research has not identified meaningful
revenues of this type in these sectors that could be systematically identified. However, FTSE
Russell continues to review the GRCS criteria in this area, particularly as disclosures in these
sectors improve.
Classifications of environmentally sustainable activities and the performance thresholds that define these
activities will continue to change over time. Maintaining classification systems to define green activities
will therefore remain a continuous process as climate targets, new green technologies and company
disclosures evolve. The EU Taxonomy, the GRCS and other green taxonomies are likely to reflect this,
and we expect to see further convergence of such
23
24 European Commission (2020). TEG Final Report on the EU Taxonomy
taxonomy_en.
25 The EU Taxonomy considered these activities as “transitioning” activities, which should improve performance continuously.
classification systems as part of the effort of building a common language for markets to describe and
measure the green economy.
Note that for full EU Taxonomy compliance, in addition to making substantial contribution to one of the
six environmental objectives, companies are also required to do no significant harm (DNSH) to the other
five objectives, and to meet minimal social safeguards (MSS). These two requirements work in a way
similar to the ESG overlay that screens out activities with significant environmental or social risks, which
is more relevant to ESG Data Model instead of Green Revenues that purely identifies products and
services with environmental benefits.
The proposed technical screening criteria to define substantial contribution to environmental objectives
under the EU Taxonomy, such as 100gCO2/kWh threshold for electricity generation, is likely to pose
challenges for different types of financial asset classes. The application of such thresholds is more
straightforward for green bonds, where the use of proceeds is usually designated to specific projects or
activities and is normally being disclosed according to the Green Bond Principles. But these thresholds will
prove more difficult for other asset classes such as listed equities, given the range of products and services
across broad value chains in which companies participate and lower current levels of granular disclosure on
green products and services. Currently it is very challenging to fully implement such technical screening
criteria across the broad listed equity market in a consistent way due to lack of disclosure. As such FTSE
Russell’s GRCS use the disclosed data available plus an activity-based approach to capture the degree of
revenue exposure to the green economy.
In summary, the use of the GRCS presented in this paper is an initial step towards measuring potential
alignment of portfolios with the EU Taxonomy. Further developments will be associated with checking
that activities meet both the technical screening criteria for significant contribution and those for DNSH
and MSS (as currently outlined by the TEG report).
Appendix 1: Case studies
Case study 1: General Electric (GE)
Industrials generally have a greater potential for green products or services than other business sectors due
to their diversified operations and broad coverage of value chains. For example, GE has a business portfolio
with products and services across a wide range of sectors. The company—which was founded partly to
commercialize Thomas Edison’s incandescent lightbulb— is now playing a leading role in manufacturing
new technologies such as renewables that are central to the low-carbon transition.
Figure 4 Green Revenues of General Electric Green Revenues
As Figure 4 shows, GE reports its revenues based on eight business segments. The Oil & Gas, Healthcare
and Capital segments are not considered green by either the FTSE Russell GRCS or the current EU
Taxonomy.
GE Aviation manufactures aircraft engines. Although aviation is a significant source of carbon emissions,
products and services that enable advances in the environmental impact of aviation that go above and
beyond business-as-usual improvements in fuel economy are considered as green activities by the FTSE
Russell GRCS. However, GE’s latest model is designed to achieve a 10% improved efficiency compared to
the previous generation, and a 2% fuel efficiency advantage over other similar engines available in the
These improvements are equivalent to the standard practice in the industry, meaning that the FTSE
Russell GRCS does not consider GE Aviation as green.
26
GE Aviation is not covered by the proposed EU Taxonomy. Although the current version of the EU
Taxonomy recognizes the importance of reducing carbon emissions from the aviation industry, the
criteria and potentially a list of eligible economic activities are yet to be developed.
The Power, Renewable Energy, Lighting and Transport segments do provide green products and
services according to both the FTSE Russell GRCS and the EU Taxonomy.
The Power segment offers grid solutions, power conversion and automation and control services, which
support energy management and efficiency. We estimate the associated revenue to be % of GE’s total
GE Renewable Energy delivers equipment and services for wind and hydropower energy
generation; it accounts for % of total revenue as disclosed. The Lighting segment focuses on LED
technology, generating % of total revenue. The Transportation segment produces locomotives and
offers digital solutions, with an estimated revenue of %.28
GE’s green products and services recognized by the FTSE Russell GRCS as explained above are all also
covered by the EU Taxonomy. We estimate that GE’s green revenues from these products and services
represent % of total
Despite the stiff competition in the renewable energy space, GE’s investment in digital strategy and
technology innovation provides opportunities for additional green products or services. The strategy
includes improvement of efficiency and flexibility of hydropower technologies, which enables grids to
accommodate more renewable energy; and enhancement or repower of wind turbine
27 As disclosed, the revenue from all these products and services plus GE Hitachi Nuclear is $. Deducting GE Hitachi Nuclear ’s revenue of $1bn, GE’s
total revenue from grid solutions, power conversion, and automation and control is estimated to be $ (%).
28 As disclosed, the revenue from locomotives production is $900m; total revenue from marine, stationary, drilling and digital solutions is
$400m, assuming revenue from digital solutions is $400m/4=$100m.
29 Excluded revenues from nuclear equipment manufacturing, which is %.
30 General Electric (2019). United States Securities and Exchange Commission Form 10-K.
Case study 2: Corning Incorporated
There is an increasing awareness of the importance of pollution prevention and control technologies,
given the air and water quality, and land contamination issues around the world, particularly in
emerging markets such as India and China.
Figure 5 Green Revenues of Corning Incorporated
Corning Incorporated, with its core business in material science, generates revenues from five business
segments (See Figure 5). Its Life Science, Specialty Materials, Optical Communications, and Display
Technologies segments have no clear environmental benefits and thus are not considered as green under
either the FTSE Russell GRCS or the EU Taxonomy.
Its Environmental Technology segment involves the manufacture of ceramic substrates and filter
products for pollution control systems in the transport sector, and therefore is regarded as green by the
FTSE Russell GRCS. The reported revenue from this segment (. the green revenue) is % of
Corning’s total revenue; this percentage is expected to increase as the company aims to double the sales
from the Environmental Technologies segment by
However, the products produced by Corning’s Environmental Technology segment are not recognized as
aligned with the EU Taxonomy. As the EU Taxonomy currently covers only climate change mitigation and
adaptation, it doesn’t include economic activities related to transport pollution reduction. Nevertheless,
“Pollution Prevention and Control” is one of the six underlying environmental objectives of the EU
Taxonomy for criteria development32, and we expect that future iterations of the Taxonomy will cover such
activities.
31 Corning Investor Day 2019. Day-
2019/
32 European Commission (2020). TEG Final Report on the EU Taxonomy
taxonomy_en.
Case study 3:
The technology sector accounts for the five largest companies within the FTSE All World Index (Microsoft,
Apple, Amazon, Facebook and Alphabet), which represent about 9% of its total market Their exposure to
the green economy mainly originates from their cloud computing businesses, which improve energy efficiency
and reduce resource consumption compared to on-site data centers.
Figure 6 Green Revenues of
Amazon reports revenues according to three segments (Figure 6). The majority of the green products or services it
provides come from the Amazon Web Services (AWS) segment (11% of total revenue), which includes computing,
storage and other data This cloud computing activity is considered green by both the FTSE Russell GRCS
and the EU Taxonomy.
Geographical segments for North America and International consist of retail sales of consumer products and
subscriptions through online stores, which do not generate clear environmental benefits. However, Whole Foods
Market (WFM), a certified organic food grocer acquired by Amazon in 2017, is considered green under the FTSE
Russell GRCS and is aligned with the EU Taxonomy.
The revenue from WFM is estimated to be % of Amazon’s total, based on disclosed revenue of physical stores by
Amazon in 2017 ($), and the disclosed percentage of organic food sales (30%) by WFM in 2016, as the latest
information is not available.
Therefore, % of Amazon’s revenues are green under the FTSE Russell GRCS and the EU Taxonomy.
With the great potential of the cloud computing market and the CEO’s commitment to address climate change,
green revenues from Amazon and other tech titans are expected to grow.
33 Data source: FTSE Russell (2020).
34 Amazon 2018 Annual Report
Case study 4: Total
Although most of their assets are still in non-green or brown sectors, some oil and gas companies are
starting to adapt their business models and increase their exposure to the green economy.
For example, Total has been increasing its involvement in green activities through acquisitions of and
investments in clean energy companies such as SunPower, Quadran, Total Eren and Saft.
Figure 7 Green Revenues of Total
Total has five business segments, as illustrated by Figure 7, of which three are not considered green
under either the FTSE Russell GRCS or the EU Taxonomy: The Exploration & Production and
Refining & Chemicals businesses generate high carbon emissions and negative environmental impacts.
The Corporate segment does not deliver any environmental benefits or impacts.
The Gas, Renewables & Power segment provides some green products and services, including renewable
energy (solar, wind, hydropower and bioenergy generation), batteries and energy efficiency (such as
improvement and management of energy performance of buildings, equipment, utilities and processes).
The estimated revenue from these activities is % of total revenue. The estimation is primarily based on
information about Total’s subsidiaries.
Specifically, these estimates are derived from disclosed revenues from pure plays acquired by Total,
including SunPower, Quadran and Green Flex, and estimated revenue from Total Solar based on
generation These show that Total generates % of its revenues from renewable energy
and % from energy efficiency services. Saft contributes another %,
35 The net capacity at Total Solar is as about twice that of Total Eren, a renewable energy company with a total revenue of $, where Total has a
23% interest. Assuming revenues from Total Solar are also twice those of Total Eren, with Total’s revenue of $, the green revenue percentage
from Total Solar is × 2 /209,363 = %.
assuming half of the end markets (buildings, utilities and transportation), where it provides high- tech
batteries are green.
Under the Marketing & Services segment, Total offers electric vehicle/hydrogen charging services at
existing service stations, which represent an important part of a low-carbon transport system. However,
there is limited information to make robust estimation on the revenues from these services.
All green products and services identified at Total are aligned with the EU Taxonomy. That is, % of
Total’s revenue is green under both the FTSE Russell GRCS and the EU Taxonomy.
Total is also building a footprint in carbon capture and storage, smart grid, biopolymers and plastic
recycling across business segments. However, with limited disclosure and insufficient granularity of
revenues breakdown, it is challenging to identify or estimate green revenues from these businesses. As
Total is investing in R&D for digital and low-carbon technologies (c.$667million in 2018),36 continued
growth of green revenues is expected.
36 Total (2019). Integrating Climate into Our Strategy.
EU TAXONOMY
SECTOR NACE
CLASSIFICATION
ACTIVITY
A
gr
ic
ul
tu
re
, f
or
es
try
an
d
fi
sh
in
g
A2 Afforestation
A2 Rehabilitation, Reforestation
A2 Reforestation
A2 Existing Forest Management
A2 Conservation forest
Growing of perennial crops
Growing of non-perennial crops
Livestock production
FTSE RUSSELL GRCS
MICRO-SECTOR CODE SECTOR
Sustainable Forestry Food & Agriculture
Sustainable Forestry Food & Agriculture
Sustainable Forestry Food & Agriculture
Sustainable Forestry Food & Agriculture
Sustainable Forestry Food & Agriculture
Organic & Low Impact Farming Food & Agriculture
Organic & Low Impact Farming Food & Agriculture
EU TAXONOMY
SECTOR NACE
CLASSIFICATION
ACTIVITY
M
an
uf
ac
tu
ri
ng
C Manufacture of low carbon technologies
Manufacture of cement
Manufacture of aluminum
Manufacture of iron and steel
Manufacture of hydrogen
Manufacture of other inorganic basic chemicals -
Manufacture of carbon black
Manufacture of other inorganic basic chemicals -
Manufacture of disodium carbonate (soda ash)
Manufacture of other inorganic basic chemicals -
Manufacture of chlorine
Manufacture of other organic basic chemicals
Manufacture of fertilizers and nitrogen compounds
Manufacture of plastics in primary form
FTSE RUSSELL GRCS
MICRO-SECTOR CODE SECTOR
Geothermal, Hydropower, Solar, Wind, , Energy Equipment,
Ocean&Tidal, Electrified Road Vehicles , Transport Equipment,
& Devices (inc hydrogen powered), , Energy Management &
Trains (Electrified & Magnetic), Shipping, , Efficiency
Buildings & Property ,
,
,
,
,
,
,
,
,
,
Recyclable Materials Environmental Resources
Recyclable Materials Environmental Resources
Organic & Low Impact Farming Food & Agriculture
Recyclable Materials Environmental Resources
Appendix 2: Mapping FTSE Russell GRCS and EU taxonomy
The table below illustrates the mapping of sustainable economic activities under the proposed EU Taxonomy and microsectors
covered by the FTSE Russell GRCS. Note that it does not include activities/micro sectors that are covered by the FTSE Russell
GRCS but not the proposed EU Taxonomy.
Activities/Microsectors that are covered by both the FTSE Russell GRCS and the proposed EU Taxonomy with the same environmental objective Activities/Microsectors
that are covered by both the FTSE Russell GRCS and the proposed EU Taxonomy with slightly different environmental objectives Activities/Microsectors that are
covered by the proposed EU Taxonomy but not the FTSE Russell GRCS
EU TAXONOMY
SECTOR NACE
CLASSIFICATION
ACTIVITY
E
le
ct
ri
ci
ty
, g
as
, s
te
am
a
nd
a
ir
c
on
di
tio
ni
ng
s
up
pl
y
District Heating/Cooling Distribution
Installation and operation of Electric Heat Pumps
Cogeneration of Heat/cool and Power from
Concentrated Solar Power
Cogeneration of Heat/cool and Power from
Geothermal Energy
Cogeneration of Heat/cool and Power from Gas (not
exclusive to natural gas)
Cogeneration of Heat/cool and Power from
Bioenergy (Biomass, Biogas, Biofuels)
Production of Heat/cool from Concentrated Solar
Power
Production of Heat/cool from Geothermal
Production of Heat/cool from Gas (not exclusive to
natural gas)
Production of Heat/cool from Bioenergy (Biomass,
Biogas, Biofuels)
Production of Heat/cool using Waste Heat
FTSE RUSSELL GRCS
MICRO-SECTOR CODE SECTOR
Buildings & Property Energy Management &
Efficiency
Buildings & Property Energy Management &
Efficiency
Cogeneration (Renewable) Energy Generation
Cogeneration (Renewable) Energy Generation
Cogeneration (Gas) Energy Generation
Cogeneration (Biomass) Energy Generation
Buildings & Property Energy Management &
Efficiency
Buildings & Property Energy Management &
Efficiency
Buildings & Property Energy Management &
Efficiency
Buildings & Property Energy Management &
Efficiency
Buildings & Property Energy Management &
Efficiency
EU TAXONOMY FTSE RUSSELL GRCS
SECTOR NACE ACTIVITY MICRO-SECTOR CODE SECTOR
CLASSIFICATION
Production of Electricity from Solar PV Solar (general) Energy Generation
Production of Electricity from Concentrated Solar Solar (general) Energy Generation
Power
Production of Electricity from Wind Power Wind (General) Energy Generation
Production of Electricity from Ocean Energy Ocean and Tidal Energy Generation
Production of Electricity from Hydropower Small Hydro, Large Hydro , Energy Generation
Production of Electricity from Geothermal Geothermal Energy Generation
Production of Electricity from Gas Clean Fossil Fuels Energy Generation
(not exclusive to natural gas)
Production of Electricity from Bioenergy (Biomass, Biogas, Biomass (Grown), Biomass , Energy Generation
Biogas and Biofuels) (Waste) ,
Transmission and Distribution of Electricity Smart and Efficient Grids Energy Management &
Efficiency
D Storage of Electricity Power storage (Battery), Power Storage , Energy Management &
(Pumped Hydro) Efficiency
D Storage of Thermal Energy Power storage (Battery), Power Storage , Energy Management &
(Pumped Hydro) Efficiency
D Storage of Hydrogen Power storage (Battery), Power Storage , Energy Management &
(Pumped Hydro) Efficiency
Manufacture of Biogas or Biofuels Biogas, Biomass (Grown), Biomass , Energy Equipment
(Waste) ,
Retrofit of Gas Transmission and Distribution
E
le
ct
ri
ci
ty
, g
as
, s
te
am
a
nd
a
ir
c
on
di
tio
ni
ng
s
up
pl
y
Networks
EU TAXONOMY
SECTOR NACE
CLASSIFICATION
ACTIVITY
Tr
an
sp
or
t a
nd
S
to
ra
ge
Infrastructure for low carbon transport (water
transport)
Infrastructure for low carbon transport (land
transport)
Passenger Rail Transport (Interurban)
Freight Rail Transport
Public transport
Freight transport services by road
Interurban scheduled road transport
Inland passenger water transport
Inland freight water transport
H Passenger cars and commercial vehicles
FTSE RUSSELL GRCS
MICRO-SECTOR CODE SECTOR
Smart City Design & Engineering,
Railway (Infrastructure), Bikes and
Bicycles
,
,
Environmental Resources,
Transport Equipment
General Railways, Electrified Railways ,
Transport Solutions
General Railways, Electrified Railways ,
Transport Solutions
Electrified Railways, Bus and Coach
operators
,
Transport Solutions
Electrified Road Vehicles & Devices (incl
Hydrogen powered)
Transport Equipment
Electrified Road Vehicles & Devices (incl
Hydrogen powered)
Transport Equipment
Shipping Transport Equipment
Shipping Transport Equipment
Electrified Road Vehicles & Devices (incl
Hydrogen powered)
Transport Equipment
EU TAXONOMY FTSE RUSSELL GRCS
SECTOR NACE
CLASSIFICATION
ACTIVITY MICRO-SECTOR CODE SECTOR
Water collection, treatment and supply Water Utilities Water Infrastructure &
Technology
Centralized wastewater treatment Water Utilities Water Infrastructure &
Technology
Anaerobic Digestion of Sewage sludge Water Utilities Water Infrastructure &
Technology
Separate collection and transport of non- hazardous
waste in source segregated fractions
Recycling Services Waste & Pollution Control
Anaerobic digestion of bio-waste Organic Waste Process Waste & Pollution Control
Composting of bio-waste Organic Waste Process Waste & Pollution Control
Material recovery from non-hazardous waste Recyclable Materials Environmental Resources
Landfill gas capture and utilization Waste to Energy Energy Generation
Direct Air Capture of CO2 Carbon Capture & Storage Energy Equipment
Capture of anthropogenic emissions Carbon Capture & Storage Energy Equipment
Transport of CO2 Carbon Capture & Storage Energy Equipment
W
at
er
, s
ew
er
ag
e,
w
as
te
a
nd
re
m
ed
ia
tio
n
Permanent Sequestration of captured CO2 Carbon Capture & Storage Energy Equipment
Construction of new buildings Buildings & Property Energy Management &
Efficiency
Building renovation Buildings & Property Energy Management &
Efficiency
Individual renovation measures, installation of
renewables on-site and professional, scientific and
technical activities
Buildings & Property Energy Management &
Efficiency
C
on
st
ru
ct
io
n
an
d
re
al
e
st
at
e
ac
tiv
iti
es
L68 Acquisition and ownership of buildings Sustainable Property Operator Energy Management &
Efficiency
EU TAXONOMY FTSE RUSSELL GRCS
SECTOR NACE
CLASSIFICATION
ACTIVITY MICRO-SECTOR CODE SECTOR
Data-driven climate change monitoring solutions Efficient IT Energy Management &
Efficiency
IC
T
Data processing, hosting and related activities Cloud Computing Energy Management &
Efficiency
Fi
na
nc
e
an
d
In
su
ra
nc
e
A
ct
iv
iti
es
Non-life insurance
Flood Control Water Infrastructure &
Technology
Meteorological Solutions Water Infrastructure &
Technology
Pr
of
es
si
on
al
,
Sc
ie
nt
if
ic
a
nd
Te
ch
ni
ca
l A
ct
iv
iti
es Engineering activities and related technical
consultancy dedicated to adaptation to climate
change
Natural Disaster Response Water Infrastructure &
Technology
Asia-Pacific
Hong Kong +852 2164 3333
Tokyo +81 3 4563 6346
Sydney +61 (0) 2 8823 3521
North America
+1 877 503 6437
EMEA
+44 (0) 20 7866 1810
To learn more, visit ; email info@; or call your regional Client
Service Team office
About FTSE Russell
FTSE Russell is a leading global provider of benchmarks, analytics and data solutions with multi-asset capabilities, offering a
precise view of the markets relevant to any investment process. For over 30 years, leading asset owners, asset managers, ETF
providers and investment banks have chosen FTSE Russell indexes to benchmark their investment performance and create
investment funds, ETFs, structured products and index-based derivatives. FTSE Russell indexes also provide clients with tools
for performance benchmarking, asset allocation, investment strategy analysis and risk management.
© 2020 London Stock Exchange Group plc and its applicable group undertakings (the “LSE Group”). The LSE Group includes (1) FTSE International Limited
(“FTSE”), (2) Frank Russell Company (“Russell”), (3) FTSE Global Debt Capital Markets Inc. and FTSE Global Debt Capital Markets Limited (together, “FTSE
Canada”), (4) MTSNext Limited (“MTSNext”), (5) Mergent, Inc. (“Mergent”), (6) FTSE Fixed Income LLC (“FTSE FI”), (7) The Yield Book Inc (“YB”) and (8)
Beyond Ratings . (“BR”). All rights reserved.
FTSE Russell® is a trading name of FTSE, Russell, FTSE Canada, MTSNext, Mergent, FTSE FI, YB and BR. “FTSE®”, “Russell®”, “FTSE Russell®”, “MTS®”,
“FTSE4Good®”, “ICB®”, “Mergent®”, “The Yield Book®”, “Beyond Ratings®” and all other trademarks and service marks used herein (whether registered or
unregistered) are trademarks and/or service marks owned or licensed by the applicable member of the LSE Group or their respective licensors and are owned, or
used under licence, by FTSE, Russell, MTSNext, FTSE Canada, Mergent, FTSE FI, YB or BR. FTSE International Limited is authorised and regulated by the
Financial Conduct Authority as a benchmark administrator.
All information is provided for information purposes only. All information and data contained in this publication is obtained by the LSE Group, from sources believed
by it to be accurate and reliable. Because of the possibility of human and mechanical error as well as other factors, however, such information and data is provided "as
is" without warranty of any kind. No member of the LSE Group nor their respective directors, officers, employees, partners or licensors make any claim, prediction,
warranty or representation whatsoever, expressly or impliedly, either as to the accuracy, timeliness, completeness, merchantability of any information or of results to
be obtained from the use of FTSE Russell products, including but not limited to indexes, data and analytics, or the fitness or suitability of the FTSE Russell products
for any particular purpose to which they might be put. Any representation of historical data accessible through FTSE Russell products is provided for information
purposes only and is not a reliable indicator of future performance.
No responsibility or liability can be accepted by any member of the LSE Group nor their respective directors, officers, employees, partners or licensors for (a) any loss
or damage in whole or in part caused by, resulting from, or relating to any error (negligent or otherwise) or other circumstance involved in procuring, collecting,
compiling, interpreting, analysing, editing, transcribing, transmitting, communicating or delivering any such information or data or from use of this document or links
to this document or (b) any direct, indirect, special, consequential or incidental damages whatsoever, even if any member of the LSE Group is advised in advance of
the possibility of such damages, resulting from the use of, or inability to use, such information.
No member of the LSE Group nor their respective directors, officers, employees, partners or licensors provide investment advice and nothing contained herein or
accessible through FTSE Russell products, including statistical data and industry reports, should be taken as constituting financial or investment advice or a financial
promotion.
Past performance is no guarantee of future results. Charts and graphs are provided for illustrative purposes only. Index returns shown may not represent the results of
the actual trading of investable assets. Certain returns shown may reflect back-tested performance. All performance presented prior to the index inception date is back-
tested performance. Back-tested performance is not actual performance, but is hypothetical. The back-test calculations are based on the same methodology that was in
effect when the index was officially launched. However, back-tested data may reflect the application of the index methodology with the benefit of hindsight, and the
historic calculations of an index may change from month to month based on revisions to the underlying economic data used in the calculation of the index.
This document may contain forward-looking assessments. These are based upon a number of assumptions concerning future conditions that ultimately may prove to be
inaccurate. Such forward-looking assessments are subject to risks and uncertainties and may be affected by various factors that may cause actual results to differ
materially. No member of the LSE Group nor their licensors assume any duty to and do not undertake to update forward-looking assessments.
No part of this information may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying,
recording or otherwise, without prior written permission of the applicable member of the LSE Group. Use and distribution of the LSE Group data requires a
licence from FTSE, Russell, FTSE Canada, MTSNext, Mergent, FTSE FI, YB, BR and/or their respective licensors.
