BM&FBOVESPA and BNDES Launch the Carbon Efficient Index

Index presented today in Sao Paulo seeks to develop environmental management practices that emphasize climate change

Dec 02, 2010, 14:18 ET from BM&FBOVESPA

SAO PAULO, Dec. 2, 2010 /PRNewswire-FirstCall/ -- BM&FBOVESPA and the BNDES launched on Thursday the Carbon Efficient Index (ICO2), which measures the return on a theoretical portfolio made up of those companies in the IBrX-50 index (constituted by the 50 most liquid shares on the Exchange) that adhered to the new initiative. The ICO2 index is calculated according to companies' free float and their greenhouse gas (GHG) emissions coefficient.

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In addition to the companies that are currently listed on IBr-X 50 and which joined ICO2, there were other firms considered that have highly liquid shares on the Exchange and the potential to join IBrX-50 at a later date. Of the 58 companies approached in all, 51 opted for voluntary adherence to the ICO2. The first portfolio, which comes into effect Thursday (December 2), will be made up of 42 companies, as follows:

ALL, AmBev, B2W, Banco do Brasil, BM&FBOVESPA, Bradesco, Bradespar, Brasil Ecodiesel, BRF Foods, Brookfield, CCR, Cemig, CESP, Cielo, Cosan, Cyrela, Eletrobras, Embraer, Fibria, Gafisa, Gol, Itau, Itausa, JBS, LLX, Lojas Americanas, Renner, Marfrig Group, MMX, MRV Engenharia, Natura, OGX, Grupo Pao de Acucar, PDG Reality, Redecard, Rossi, Santander, TAM, Oi, Tim, Vale and Vivo.

Nine companies adhered to the initiative and participated in the process, but will not be part of the first Carbon Efficient Index portfolio because they are not currently members of IBrX-50. They are:

Braskem, Copel, CPFL, Duratex, AES Eletropaulo, Klabin, Light, Ultra and Souza Cruz.

The index will be rebalanced quarterly based on companies' free float, and annually (every September) based on their emission coefficient. The Exchange opted for an inclusive methodology in the first year of the index. This means presentation of emission inventories was not obligatory, but companies did have the opportunity to supply contributory information for an estimate of their CO2 emissions. The harmonization of data was conducted by global environment research company Trucost.

As of next year, there will be obligatory inventories that include companies' direct emissions and their indirect emissions resulting from electricity consumption. In 2012 there will be more emission sources considered, based on a study to be made in 2011.

For BM&FBOVESPA and BNDES, the very act of adhesion to the ICO2 shows companies' commitment to climate-related questions, to transparency regarding emissions and that companies are preparing for a low carbon economy. ICO2 methodology does not measure GHG emission management/mitigation. To help visualize these initiatives, the Exchange has created a specific area on the Em Boa Companhia (In Good Company) website for member companies to publish their emission inventories and other GHG emission actions.