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Indices & Screening

Sustainable Finance

Indices & Screening

When creating sustainable financial indices, CFA aims to fill observed market gaps and enabling the growth of the sustainable finance market in Asia. CFA provides customized index solutions based on high-quality databases and proprietary methodologies. Each index is developed to tackle specific sustainability issues and uses screening and ranking to reward the best practitioners and to ensure high integrity.

Our Indices

Global X Green J-REIT ETF
Global X Green J-REIT ETF is issued based on the Solactive Carbon Care Asia Pacific Green REIT Index
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Solactive CarbonCare Asia Sustainability Bond Index
The Solactive CarbonCare Asia Sustainability Bond Index is the first index of its kind to measure the growth of green, social and sustainability bonds in the Asia Pacific region.
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Solactive CarbonCare Asia Pacific Green REIT Index
The Solactive CarbonCare Asia Pacific Green REIT Index is the first of its kind to allow investors to identify companies which demonstrate strong sustainability performance and commitments to meet the carbon reduction targets set out in the Paris Climate Agreement.
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Our Screening

With support of AI technology, CFA provides ESG screening services to clients to ensure their investment products fit robust ESG criteria. As a trusted ESG advisor, CFA will evaluate information on companies’ ESG performance, including (but not limited to): Environmental criteria such as climate change impact, pollution management, resource efficiency, and biodiversity conservation; Social criteria including labor practices, human rights, diversity and inclusion, and community relations; and Governance criteria involving board structure and independence, executive compensation, business ethics, and shareholder rights, etc.

Our client: 1.5℃ ESG Focused Hedge Fund

  • 1.5℃ ESG Focused Hedge Fund, aims to provide liquid, low volatility and ESG thematic investment opportunities for professional investors, is developed through a collaboration between StormHarbour and Climate Finance Asia.
  • The fund uses AI machine learning techniques to picking the most economically-promising stocks, the least economically-promising stocks, and apply negative screening based on ESG factors.
  • Using this technique, the fund has back testing historical data from 2016 – 2022, results in an annualized return of ~19% and a Sharpe ratio 2.62.
  • With this AI Fintech solution, CFA helps asset managers, asset owners and family offices to setup customized ESG / green thematic funds.

Global X Green J-REIT ETF

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  • Global X Green J-REIT ETF is issued based on the Solactive Carbon Care Asia Pacific Green REIT Index
  • It aims to invest in J-REITs that invest in environmentally friendly properties (green buildings)


Global X Green J-REIT ETF:

https://globalxetfs.co.jp/en/funds/2855/index.html

Solactive CarbonCare Asia Sustainability Bond Index

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The Solactive CarbonCare Asia Sustainability Bond Index is the first index of its kind to measure the growth of green, social and sustainability bonds in the Asia Pacific region. Co-developed by CCA and the German index provider Solactive AG, this index was launched in December 2019 with the aim to accelerate the development of green bonds in the region and to enable investors to track the performance of Asia-Pacific bonds that can demonstrate high integrity and transparency in environmental and social contributions.

As a rules-based index, only bonds that are issued to contribute to environmental sustainability or to address social challenges with a positive impact in the region are eligible for inclusion. The eligible bonds are required to pass a two-layered screening by CCA in order to be included in the index. The screening is intended to examine the transparency standards of the bond issuers and ensure that the proceeds from the bond issuance are designated for projects that have significant positive outcomes. This screening by CCA is in line with international best practices under its proprietary Green and Social Taxonomy.

This index also aims to become a valuable tool for asset owners in managing their ESG mandates and to serve as a reference for the wider investment community.

As of January 2021, the index includes 130 bonds. The index is quoted in USD and calculated as a total return index.

Solactive CarbonCare Asia Sustainability Bond Index: 

https://www.solactive.com/indices/?index=DE000SLA9ST6

Solactive CarbonCare Asia Pacific Green REIT Index

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The property sector is responsible for approximately one-third of global greenhouse gas emissions and 40% of global energy consumption. This development drives growing interest from global real estate investors to integrate sustainability into their investment process. The Solactive CarbonCare Asia Pacific Green REIT Index is the first of its kind to close this gap and allow investors to identify companies which demonstrate strong sustainability performance and commitments to meet the carbon reduction targets set out in the Paris Climate Agreement.

Co-developed by Carbon Care Asia and Solactive, the Solactive CarbonCare Asia Pacific Green REIT Index was launched in Nov 2020. As many of the most precious properties in Asia Pacific are located in cities vulnerable to sea-level rise and extreme climatic events, the index serves as a valuable tool for investors to differentiate climate-conscious REITs which can protect their assets better from future shocks, from the rest of the pool.

It is a rules-based index and includes Asia Pacific REITs that own the highest percentage of green-certified buildings in their portfolio and which are committed to climate-aligned emissions reduction targets. Additionally, the index applies weights to reward best practices and industry climate leaders in the Asia Pacific region. The weighting methodology on securities is based upon a combination of factors such as the percentage of Certified Green Building Area owned; or a commitment to a Net Zero Emissions (NZE) target no later than 2050 or a Science-Based Target (SBT).

As of January 2021, the Solactive CarbonCare Asia Pacific Green REIT Index holds 49 REITs. The index is quoted in USD and calculated as a total return index.

Solactive CarbonCare Asia Pacific Green REIT Index: 

GTR: https://www.solactive.com/indices/?index=DE000SL0BUG7

NTR: https://www.solactive.com/indices/?index=DE000SL0BUF9

PR: https://www.solactive.com/indices/?index=DE000SL0BUE2