BSE launches ‘Greenex’ for eco-friendly investors

The Bombay Stock Exchange today launched the BSE Greenex - India's first index based on carbon efficiency, designed to set a benchmark for socially conscious investors.

Inaugurated by corporate affairs minister Veerappa Moily, the 20-share Greeenex comprises some of India's leading companies such as Tata Motors, Tata Steel, ICICI Bank, Larsen & Toubro, Housing Development & Finance Co, Reliance Infrastructure, Dr Reddy's Laboratories and real estate operator DLF.

"The cost of carbon-based energy production is increasing, and if companies become more efficient and reduce energy costs there is a chance of higher profitability," Ashishkumar Chauhan, BSE's deputy chief executive officer, said at the launch function.

"There are many socially aware investors willing to pay a premium to invest in green companies which often give better returns," he said.

The index can be used to develop green financial products, including mutual funds, exchange-traded funds and structured products, the BSE said in a statement.

The initiative has been launched in association with Germany's gTrade, Observer Research Foundation and IIM Ahmedabad. They have helped construct the Greenex to specifically promote green investing, with emphasis on financial performance and long-term viability.
The 20 BSE-Greenex companies have been selected on greenhouse gas numbers, free float market capitalisation, and turnover.