The outcome: the world’s first water security indices
After normalising and scaling the Refinitiv water data, TSC was able to design a suite of water security indices for the US and Eurozone with a global index planned for the second half of 2021:
1. The TSC US Water Security Index®
2. The TSC Euro Water Security Index® 3. The TSC Global Water Security Index®
Once water risk is quantified, it informs index constituent weightings. The company has also leveraged the digital platform of index administration innovators, Moorgate Benchmarks in London, so that global investors can access the indices in real time.
The bonus: lower carbon footprint
Discussions with a leading US asset manager for purposes of launching TSC Water Security UCITS discovered that an unexpected benefit of good water stewardship is a lower carbon footprint – which is logical when considering that companies who manage their water well also target better carbon efficiency. The TSC Water Security Indices carbon footprint is 49% lower in the Eurozone and 20% lower in the USA than their equity benchmarks.
Tapping into Refinitiv’s high-quality data, market-leading expertise and superior technology, TSC has sponsored a ground-breaking range of investable indices that helps advance the financial community by providing greater exposure to low-water-risk and lower carbon emissions thereby addressing SDG 6 (Clean Water) as well as SDG 13 (Climate Action).
The TSC Water Security Indices can be invaluable to a broad spectrum of financial professionals, used as the foundation of innovative financial instruments that meet global demand for responsible investment. Moreover, they can help clients gain a better understanding of climate and water risk.