Index rates on social responsibility
A new index which tracks the performance of companies with the highest standards of corporate and social responsibility has outperformed more mainstream investment indexes, according to its designers.
Research and ratings agency RepuTex has launched a social responsible investment (SRI) index based on the S&P/ASX 300 Index, as well as an online service designed to provide investors with corporate social responsibility (CSR) information and research.
The index included 44 companies from the S&P/ASX 300 Index which RepuTex had given a CSR rating of “A” or higher, on assessment of their performance and risk exposure in corporate governance, environmental impact, social impact and workplace practices.
RepuTex chief executive Laurel Grossman said the index “went beyond ethical investment”, considering risk analysis and management which was relevant to a company’s mainstream financial performance.
Grossman said research on historic data from the 2004/05 financial year showed the index had outperformed the ASX All Ordinaries by 1.21 per cent and the S&P/ASX 300 by 0.23 per cent.
RepuTex chairman Graeme Lee said the S&P/ASX 300 had been chosen as the universe for the index because all companies included had passed tests in terms of size, market liquidity and trading volumes.
“All the companies that were in the ASX 300 were given the opportunity to undergo some corporate social responsibility assessment for the purposes of being considered for the [RepuTex] index. Some responded to that and some didn’t,” he said.
Companies were pre-screened to make sure they could achieve the single “A” rating and those which met the criteria were then assessed in further detail.
The index includes companies from a range of industry sectors, such as Westpac Banking Corporation, BHP Biliton, Telstra, Amcor and Coles Myer.
Lee said the index would be independently calculated by Standard & Poor’s on a daily basis.
He added financial advisers could access the index by phoning the company or visiting its website, which also included an on-line service incorporating research on 400 companies globally, including companies in the RepuTex SRI Index.
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
