Private Capital Awards 2023: Index providers zero in on ESG

Asset Management / Awards / Wealth Management

Sustainability investing requires high levels of technical competence and transparency

The Asset 27 Jul 2023

The focus on sustainability in a challenging market environment is making investors more demanding of their index providers. This follows the trend last year when sustainability became embedded in indices for almost all asset classes and investment strategies.

During the period under review, it became evident that index providers must have high levels of technical capability when it comes to environmental, social, and governance (ESG) investing. Clients require superior analyses and recommendations when they transition their portfolios to sustainability strategies, particularly in terms of ESG scoring and science-based methodology. These technical capabilities must match what the index providers present to their clients on paper.

Another trend is that clients are putting greater importance on the ability of their index providers’ ESG teams to handhold them throughout the indexing process. Index providers who are more open to client suggestions and feedback gain trust and loyalty in the market.

Clients are also demanding increased transparency from their index providers, who must be able to clearly explain their index strategies and methodologies particularly as they relate to sustainability.

Index providers must be able to explain and interpret new ESG regulations in ways that will allow clients to expand their understanding and knowledge of such regulations.

Regional clients are also looking at the fee structure of index providers to ensure cost efficiency under current market conditions. One issue they have raised is that the fee structure of some index providers is more suitable for global clients who have better economies of scale.

Clients are seeking more product customization, quicker product delivery, and more comprehensive data and research.

It is in this context that we are announcing the winners of the Best Index Provider Awards of The Asset Triple A Private Capital Awards for Private Banks, Wealth & Investment Bank Advisers, Solutions and Index Providers 2023.

This year, there were no awards given for “Best Index Provider, Innovation”, “Best Index Provider, Strategy”, and “Best Index Provider, Digital Assets”.

FTSE Russell

FTSE Russell’s ability to be nimble and accommodating to client requirements has enabled them to win mandates, particularly in the fixed-income asset class. Its ability to produce tailor-made, customized indices to fit client requirements makes it the best index provider during the awards period.

FTSE Russell is recognized as:

Best Index Provider, Asia
Best Index Provider, Fixed Income, Asia
Best Index Provider, ESG, Asia (Highly Commended)

S&P Dow Jones Indices

S&P Dow Jones Indices displayed its leadership in ESG indexing during the awards period. It also continues to be the dominant index provider, particularly in equities, in the Asia-Pacific region.

S&P Down Jones Indices is recognized as:

Best Index Provider, ESG, Asia
Best Index Provider, Equity, Asia
Best Index Provider, Multi-Asset, Asia
Best Index Provider, Commodities, Asia
Best Index Provider, Thematic, Asia

China Securities Index

China Securities Index (CSI) remains the leading index provider in China, with 1.64 trillion yuan (US$229 billion) of assets tracking its indices. It has continued to display its ability to provide accurate, timely and quality ESG data to serve both index-related needs and other market demands. Last year CSI also launched Beijing Stock Exchange 50 Index to tap new market opportunities.

China Securities Index Company Limited is recognized as:

Best Index Provider, China

ChinaBond Pricing Center

ChinaBond Pricing Center (CBPC) continues to be the market leader in servicing fixed-income products in China. Assets under management (AUM) of onshore funds tracking ChinaBond’s indices stand at 366.7 billion yuan, and funds with AUM of 4.6 trillion yuan are benchmarked against ChinaBond’s indices. The index provider continues to refine its in-house ESG rating framework, which is the first in China to cover 9,000 issuers and A-share-listed companies. CBPC’s service quality is well recognized by its clients.

ChinaBond Pricing Center is recognized as:

Best Index Provider, ESG, China
Best Index Provider, Fixed Income, China

CCX Indices

CCX Indices’ strong track record is recognized by wealth management clients, especially when it comes to its customization capabilities and efficiency in launching indices. Although coming to the market relatively recently, the index provider has been actively collaborating with well-established peers to boost market impact.

CCX Indices is recognized as:

Best Index Provider, Fixed Income, China (Highly Commended)

Qontigo

Qontigo provides clients with tailored thematic solutions through its open architecture and modern technology that efficiently integrate with its clients’ processes.

Qontigo is recognized as:

Best Index Provider, Thematics, Asia (Highly Commended)

Hang Seng Index

As the leading index provider in Hong Kong, Hang Seng Index offers solutions focusing on biotech, healthcare, innovation, ESG and technology, enabling it to cater to its clients’ increasingly sophisticated requirements in the thematics space.

Hang Seng Index is recognized as: