SIX has unveiled new ESG indices in the Swiss equity and bond markets to meet increased investor demand for sustainable strategies.

The Swiss Stock Exchange now offers two SPI ESG indices for equities based on the Swiss Performance Index (SPI).

For bonds there are 20 new SBI ESG indices available, all based on the Swiss Bond Index (SBI).

In developing its ESG indices, SIX has drawn on data sources including the independent Swiss sustainability rating agency Inrate. The ESG Impact Rating developed by Inrate measures the positive and negative impacts of companies on the environment and society.

To be included in the indices, a company must have an ESG Impact Rating of at least a C+ and generate no more than five percent of its revenue in a critical sector. Critical sectors include adult entertainment, alcohol, armaments, gambling, genetic engineering, nuclear energy, coal, oil sands and tobacco.

Index candidates also cannot appear in the exclusion list of the Swiss Association for Responsible Investments.

Marion Leslie, head of financial information and a member of the SIX executive board, said: "SIX is introducing ESG indices with broad coverage of Swiss equities and bonds for the first time. In doing so, we are creating new opportunities for investors to target their investments with sustainable criteria. This is in line with our strategy to consistently evolve our data offering to provide solutions for future market needs."

Inrate’s chief executive officer, Christoph Müller, added: "Investors integrate ESG into their investments in order to incorporate general concerns and values of society and to expand the data basis for investment decisions. This requires a high degree of comparability, systematics and, if possible, quantification. Inrate wants to take the leading role in this."