March 2021

Client engagement | Client story

A Multi-Asset, Green
Investment Approach“From our perspective, FTSE Russell were ahead of the curve, relative to thecompetition, in having a really impressive, granular set of green revenue data.
That, for us, was obviously very appealing.”– Daniel Bowie-Macdonald, Investment Specialist, Multi-asset Investing Aberdeen Standard Investments

About the client
ProfileObjectives

Solution

Aberdeen Standard Investments (ASI)
manages £455.6bn of assets forgovernments, pension funds, insurers,companies, charities, foundations andindividuals across 80 countries.

ASI was seeking a data model tohelp identify new investment
opportunities and support regulatory
reporting in its new Multi-Asset
Climate Solutions Fund.

FTSE Russell’s Green Revenues 2.0
data model measures the green
revenue exposure of more than
18,000 listed companies across 48
developed and emerging markets.

Aberdeen Standard Investments:
Client profile
Aberdeen Standard Investments (ASI) offers solutions that span equities,
multi-asset, fixed income, liquidity, sovereign wealth funds, real estate and private
markets. The firm’s aim is to transform new investment ideas into practical investment
products, designed to deliver real value for money to investors.
As at 30 June 2020, ASI managed a total of £455.6bn (€501.2bn/$562.9bn) of assets
on behalf of governments, pension funds, insurers, companies, charities, foundations
and individuals across 80 countries.

Client engagement | Client story

Objective: Find cross-asset climate
opportunities
In early 2021, ASI launched the Multi-Asset Climate Solutions (MACS) fund in
partnership with The Big Issue Group (TBIG), which works with over 1,700 vendors
who earn a living by selling the Big Issue magazine. ASI has committed to sharing
20% of the net revenue generated by the fund to support TBIG’s social causes. The
Fund is available for sale in the U.K.
The MACS fund seeks to invest in companies whose products and services play adecisive role in mitigating climate change and building a more sustainable future.
These companies are expected to grow rapidly as the world accelerates its shift
towards net zero carbon emissions. As a multi-asset fund, MACS enables investors
to participate in the climate shift whilst spreading risk across climate-focussed
equities and bonds, renewable infrastructure trusts and real estate.

Aberdeen Standard Investments
Multi-Asset Climate Solutions(MACS) fundLaunched in February 2021, the ASIMACS fund is designed for those whowant to invest in companies whose
products and services play a decisiverole in mitigating climate change andbuilding a more sustainable future.
These companies are expected to growrapidly as the world accelerates its shift
towards net zero carbon emissions.

The key aims of the MACS fund are to:–Find companies driving the shift to a zero-carbon green economy–

Use a multi-asset approach to diversify risk

–Help investors fund the climate transition with historically less volatile returns–

Promote investment in renewable energy, electric vehicles, smart working,energy-efficient buildings and other green technologies–

Exclude investment in fossil fuel producers and controversial activities

Solution: FTSE Russell’s Green
Revenues data model
To help identify the cross-asset-class climate change investment opportunities thatmost aligned with its objectives, ASI turned to FTSE Russell’s Green Revenues 2.0
data model.
This model measures the green revenue exposure of more than 18,000 listedcompanies across 48 developed and emerging markets, covering over 98% of thetotal global equity market capitalisation.
FTSE Russell identifies any company with revenues derived from environmental
products and services, classifies the green revenues based on FTSE Russell’sGreen Revenues Classification System (GRCS), and calculates a green revenues
percentage, representing the portion of green revenues generated in a single fiscal
year as a percentage of the company’s overall revenues.

FTSE Russell

2Client engagement | Client story

FTSE Russell’s Green Revenues Classification System (GRCS)
Water
infrastructure
andtechnology

Transportsolutions

The model was launched in 2020 tooffer enhanced granularity andusability data, featuring:

Energygeneration

Waste andpollution
control

EnergyequipmentGreenrevenues
revenues%$

Transport
equipment

Energymanagement
andefficiency

Environmental
resources
Food andagriculture

The Green Revenues 2.0
data model

Environmental
supportservices

Multiple sub sector allocation
No minimum revenue threshold

10Sectors

64

Subsectors

133

Micro sectors

Green revenues data can be mapped over time, calculated across any of the greensectors, subsectors, and micro sectors, and aggregated by company size,
traditional industrial classifications, country or region or globally.

–

An expanded taxonomy based ona broad range of green products
and services, covering 10 sectors,
64 subsectors, and 133 microsectors.

–

A green tiering system to assess
the level of net environmental
impact over seven environmental
objectives, assigned to three tiers.

–

An estimation methodology for allcompanies that do not disclose
this data based on additional
non-revenue disclosures andmodeling of available data at theindustry sub-sector level.

A detailed corporate financial history, dating back to 2008, allows users of themodel to identify and analyse the structural shift to a green economy acrosspublic companies.

Meeting regulatory reporting
requirements
Under a new action plan on sustainable finance, adopted in 2018, theEuropean Union (EU) took steps to integrate sustainability considerations into
its financial policy framework and to mobilise future financial flows to support
sustainable growth.
The plan included 10 key actions, the first of which was to establish a clear EU
Taxonomy – a formal classification system for sustainable economic activities.
This taxonomy came into force at the end of 2021 and imposes a number ofobligations on companies that offer investment products for sale within the EU.
Providers of financial products focused on sustainability are required to disclose
how, and to what extent, the underlying investments support economic activities
that are aligned with the taxonomy. And companies within the scope of the EU’s
Non-Financial Reporting Directive, which came into effect in 2018, now have todisclose whether and to what extent their activities are associated withenvironmentally sustainable economic activities.
The EU Taxonomy and FTSE Russell’s Green Revenues Classification System
are similar in structure and highly aligned on core activities. Although the GRCS
is somewhat broader in scope than the EU Taxonomy, its modular structure
allows GRCS users to exclude these elements when calculating taxonomyaligned revenues.

FTSE Russell

Additional information
Get more information about FTSE
Russell’s green revenues data model.
For other information on ourproducts and services, visit
lseg.com/ftse-russell

3

ABOUT FTSE RUSSELL
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