Index construction for sustainable development investing

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalpeer-review

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Author(s)

  • Alexander Bassen
  • Christian Fieberg
  • Othar Kordsachia
  • Kerstin Lopatta
  • Bastian Nendza

Related Research Unit(s)

Detail(s)

Original languageEnglish
Pages (from-to)702-722
Journal / PublicationJournal of Sustainable Finance & Investment
Volume13
Issue number1
Online published2 Aug 2022
Publication statusPublished - 2023

Abstract

We implement the definition for Sustainable Development Investing (SDI) developed by the Global Investors for Sustainable Development (GISD) Alliance to construct an investable global SDI-aligned equity index. To this end, we create a proprietary methodology to rate companies’ SDI contribution using the Sustainable Development Goals (SDGs) as the appropriate unit of measurement. We find that the inclusion of SDI preferences in a multi-objective portfolio yields similar risk-return characteristics as a benchmark portfolio. This article informs institutional investors and index providers about practical approaches to implement the SDI definition with recently developed commercial data solutions. In this context, we review and provide an overview of data availability for the classification of companies’ alignment to the SDGs based on their products and services. © 2022 Informa UK Limited, trading as Taylor & Francis Group

Research Area(s)

  • CSR ratings, equity indices, Sustainable Development Goals, Sustainable Development Investing

Citation Format(s)

Index construction for sustainable development investing. / Bassen, Alexander; Fieberg, Christian; Kordsachia, Othar et al.
In: Journal of Sustainable Finance & Investment, Vol. 13, No. 1, 2023, p. 702-722.

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalpeer-review