London Stock Exchange: Valuation of companies carrying Green Economy Mark tops £67bn

The number of companies on the London Stock Exchange (LSE) awarded its Green Economy Mark has risen significantly since the launch of the labelling scheme last autumn, highlighting the growing influence and strong performance of companies providing green products and services.

LSE published its annual green economy report this morning, confirming that eight new issuers have been awarded the Green Economy Mark since the launch of the scheme last October, taking the total number carrying the label to 86 issuers with a combined market cap of over £67bn, up from £55bn at launch.

The new companies to secure the mark include a number of high profile firms, such as Cairn Homes, National Express Group, Gresham House, and TP Group.

The Green Economy Mark is available to companies and funds that list on the London Stock Exchange and derive more than 50 per cent of their revenues from green products and services, providing investors with a mechanism for investing in a wide range of green economy companies.

"London Stock Exchange congratulates all the issuers who have received the Green Economy Mark, bringing the total number of issuers to 86 across our markets," said Denzil Jenkins, Interim CEO of London Stock Exchange plc. "The Green Economy Mark underlines our commitment to finding innovative solutions to support the growing investor demand for actionable climate related financial information. As a leader in green finance, London Stock Exchange Group is ideally placed to support issuers and investors in the transition to a sustainable, low-carbon economy."

Today's report also highlighted the relatively strong performance of companies carrying the label.

Green Economy Mark issuers accounted for just two per cent of total market capitalisation on the exchange, but accounted for four per cent of the total number of equity issuers and eight per cent of total capital raised in the past 24 months.

"Collectively, issuers with the Green Economy Mark have outperformed the FTSE All-Share Index over the past two years by 36 per cent," the report added. "While the markets experienced significant volatility during the COVID-19 pandemic, Green Economy Mark equities have, in aggregate, demonstrated greater resilience and subsequently recovered faster than the rest of the market."

The report also suggested that the label is gaining traction with both investors and issuers. "For investors, the Mark provides a solution to the challenge of identifying an investible universe of green economy equities that can give them broad, cross-sector and international exposure, rather than a narrower focus on, for example, renewable energy infrastructure or pure-play clean technology companies," it stated. "For issuers, the Mark provides greater visibility to those investors and tangible evidence of their contribution to a sustainability strategy."

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