How do the TSC Water Security Indices differ from other Water Indices in the market?
Existing water indices are highly concentrated (30-50 companies) and invest solely in companies that are in the Water industry (manufacture Water purification/recycling products and Water utilities.) Their scope provides less diversification, scalability and no measurement of Water risk. The TSC Water Security Indices are the only indices that invest across all sectors while incorporating their proprietary Water risk measures.
Why does the Index include so many companies rather than simply target "best" Water Stewardship?
The TSC Water Security Indices apply a comprehensive approach to ensure that index membership best reflects large capitalisation equities across all sectors. This results in much higher correlation to equity markets while meaningfully reducing the water footprint vs. the benchmark.
Why do the TSC Water Security Indices exclude gambling, tobacco and defense contractors?
Companies from these industries are generally considered unethical and unsustainable investments and in order to adhere to ESG criteria, the TSC Water Security Indices exclude these companies as a matter of compliance.
Why do the TSC Water Security Indices exclude the worst ESG/SDG companies?
Companies with the lowest ESG/SDG Combined Ratings are considered to be non-compliant with UN Sustainability and ESG Principles.
What is the source of the TSC Water metrics?
The TSC Water Security Indices source all raw metrics from Refinitiv, who are a market leader in the provision of Water data. As the key input to index rebalancing, TSC apply proprietary techniques in order to quantify water risk at the company level.
Are Water metrics required to be reported by companies?
Water measures are reported by many companies in their annual report and other public filings. While there are no regulatory requirements for companies to provide this information, more and more companies are reporting their water usage and stewardship each year in response to public pressure. As the focus on Climate at the company level increases, the number of companies including water metrics is expected to increase. The TSC Water Security Indices help to engage with those companies who do not report which TSC believes will incentivise better reporting.
How many companies report Water measures today?
594 of the 600 largest US companies report some or all Water measures. In the Eurozone, 242 of the largest 250 companies report some or all water measures. The number of Water measures reported by companies is increasing and is expected to increase as further pressure is applied to managements to provide more Water data.