Index profile

Global Challenges Index (GCX)

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Principles

The Global Challenges Index is a real innovation on the financial market. For the first time, it maps out trends in the model of sustainable development consistently and intelligibly in an index. Sustainability-oriented investors will profit from the Global Challenges Index, which

- defines “sustainability” in concrete terms by focusing on seven future-relevant fields for action,
- sets stringent and consistent performance criteria for the companies listed and
- identifies pioneering companies that make active use of the opportunities provided by global change.

The Global Challenges Index focuses on seven global challenges for this millennium which politics, society and the economy must face up to:

- combating the causes and consequences of climate change;
- securing adequate provision of drinking water;
- stopping deforestation;
- preserving biodiversity;
- dealing with population development;
- combating poverty;
- supporting responsible governance structures.

The Global Challenges Index comprises companies which are actively facing up to this responsibility and have made substantial, forward-looking contributions to surmounting the global challenges.

The Index contains 50 securities from globally active large companies as well as small and medium-sized companies (SMEs), which are promoting sustainable development through their range of products and services and are simultaneously opening up opportunities for the future development of their business.

The composition of the Index is reviewed end of March and September each year. Companies which no longer satisfy the defined requirements will be replaced at these times.

Excluding criteria

The selection of companies for the GCX is based on comprehensive positive and negative criteria. In addition to the exclusion of controversial areas of business (e.g. nuclear power, biocides, genetic engineering in agriculture and armaments), companies which in their business practices violate recognized standards in the areas of the environment, labour rights and human rights, as well as corporate governance, will also be excluded from the Index. Please find more information on the criteria on

www.gc-index.com/en/index/methode/kriterien.php.

Positive criteria

A two-stage selection process ensures that only companies which have integrated sustainability into their business processes and are simultaneously actively tackling the global challenges are included in the Index:

In the first step, oekom research uses its Corporate Responsibility Ratings to identify which companies take particular account of environmental and social criteria in their business processes. Only companies which satisfy the rating’s stringent requirements will make the shortlist for selection for the Index (absolute best-in-class approach). Companies which violate specified exclusionary criteria (see right) are excluded on principle.

In the second step, oekom research selects those companies which make a substantial contribution to surmounting the global challenges and at the same time make use of new market opportunities, e.g.

- ensuring the long-term availability of resources, for example through sustainable forestry and fisheries management,
- reducing market-price risks, for example through increasing energy efficiency and ensuring access to raw materials,
- preserving competitiveness through technical innovation, for example in the area of renewable energies,
- opening up new markets, for example in the area of microfinance,
- dealing with population development;
- maintaining and improving their social acceptance and reputation.

A financial analysis ensures that the selected companies also satisfy the minimum requirements in terms of market capitalisation.

An independent advisory board advises oekom research on developing the concept, on defining the positive and exclusion criteria and on identifying suitable securities.

Please find an overview on the positive criteria on

www.gc-index.com/de/index/methode/kriterien.php.

Research done by

Oekom Research AG

 
Funds based on the index Ein Überblick über die für den GCX vergebenen Lizenzen findet sich unter: www.boersenag.de/de/investments/nachhaltige_investments/ Produkte_GCX
Finance-/tech. - support by Deutsche Börse AG
Benchmark none
Company profiles Profile aller im Index gelisteten Unternehmen inklusive einer Begründung für die Auswahl finden sich unter www.gc-index.com/de/index/indexstruktur
 

This indice profile is aligned with the index provider.