FTSE debuts nine new environmental indices

Investors wishing to track the performance of clean tech firms will from today have access to a raft of new benchmarks following the launch nine new indices designed to track the performance of different sub sectors within the environmental investment sector.

The indices, which have been developed by global index company FTSE Group and environmental investment company Impax, include benchmarks tracking the performance of investments in water technology firms, waste and pollution management companies, firms specialising in energy efficiency, and renewable energy developers.

The firms featured on the indices have been selected from a pool of 470 clean tech firms, each of which generate at least 20 per cent of their revenue from environmental opportunities. They are designed to allow companies to measure how their investments are performing against their peers.

Speaking to BusinessGreen.com, Lee Clement, investment manager at Impax, said that the new indices were a sign of the growing maturity of a clean tech sector that is no longer being regarded as a homogenous whole by investors.

"The fact that there is an appetite for these types of indices shows that the environment sector is maturing at pace," he said. "It used to be seen by investors as synonymous with renewable energy – or worst than that, just wind and solar – but now investors are looking at the full breadth of environmental businesses and are demanding more sophisticated information on different sub sectors."

He added that the new indices would help investors to work out which sub sectors are performing best and offering the best returns. "Over time these indices will allow people to better look at the characteristics of different sub sectors and select defensive catergories against growth categories, for example, " he said.