The Green Bond Select Index has been created to capture “the most liquid and tradable segment of green-labelled bonds issued globally”, the company said.
“Only green bonds that fulfill a strict set of requirements, such as designation of 'green' by the Climate Bonds Initiative, a debt rating aligned with its credit quality and a minimum outstanding par value are eligible for inclusion,” it said.
S&P Dow Jones Indices deputy head of product management Reid Steadman said “strong demand” for investment opportunities that took into consideration environmental, social and governance factors had driven the creation of the index.
“The S&P Green Bond Select Index is a benchmark for market participants seeking to monitor developments in this critical area of green finance,” he said.
VanEck has been licensed to develop an ETF off the index, the company said, S&P Dow Jones Indices said.
“We are seeing increasing interest from investors for ways to build sustainable, environmentally conscious portfolios, but until now they have had few investible fixed income index solutions,” said VanEck head of ETF product management and marketing Edward Lopez.
“We believe the S&P Green Bond Select Index provides an excellent foundation for financial products such as ETFs, which can provide efficient and cost-effective access to the green bond market.”
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