ICE MSCI 

ESG Index 

Futures

October 2020
INTERCONTINENTAL EXCHANGE

Introduction: Strong Tailwinds for ESG integration

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Convergence of evolving Fiduciary Duties, increasing

Regulatory obligations, and strong Client Demand:

➢ Fiduciary Duties – Universal owners by nature with wide portfolio

holdings exposed to long term portfolio macro trends

➢ Regulatory – AIFM and MiFID firms will need to review processes

and resources as well as sustainability risks within risk

management processes (Mifid2, UCITS)

➢ Need for Risk Mitigation – High profile corporate controversies,

Risk/Return profiles of ESG indices, performance of ESG factors

during the COVID crisis

➢ Client demand – Large investors advocacy, evolving need from

clients to reflect their values
INTERCONTINENTAL EXCHANGE

• Global benchmarks in 

energy, ags, interest 

rates, FX & equity 

indexes

• NYSE Group is the most 

liquid group of equities 

markets 

• Early investor in global 

emissions markets

• Leading venue for 

green ETFs and indices

• Futures on the MSCI 

ESG Leaders and MSCI 

Climate Change Indices

ICE - Serving Global Markets

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• A common clearing 

technology platform 

across global 

jurisdictions

• Proven risk management 

frameworks and 

governance

• Over 6.2 million futures 

and OTC contracts 

traded daily

• Clearing on ICE Clear 

US for MSCI ESG 

Equity Index Futures

• Data from global 

exchanges & fixed 

income markets 

delivered in flexible 

efficient formats

• Unique access to over 

500 metrics of ESG 

Reference Data

• Multi-asset class index 

services with Green 

Bond Indices and 

Custom ESG indices 

for benchmarking and 

performance 

measurement

• Leader in large IPOs, 

tech IPOs and ETFs

• NYSE network of leading 

companies and market 

model offers unparalleled 

value

• Resources and 

educational 

opportunities on ESG 

for NYSE-listed 

companies

ESG solutions across trading, clearing, data & listings

Connecting participants to a global ecosystem of information, trading, 

clearing and capital raising

Global 

Markets

Central 

Clearing

Data 

Services 

Listings 

Leadership
INTERCONTINENTAL EXCHANGE

0

40

80

120

160

200

240

0

10

20

30

40

50

60

2014 2015 2016 2017 2018 2019 Q2' 20

# of ETFs and ETPs

• Since 2009, ICE & MSCI worked

together to build the leading

franchise of MSCI derivatives

US$15B ADV and US$125B OI

• Total Assets benchmarked to

MSCI ESG Indexes grew to over

$220 billion across institutional,

retail and ETF assets

• MSCI No. 1 in number of ETFs

and ETF assets linked

• Need for Exchange Listed futures

designed to facilitate integration

of ESG consideration in an

equity portfolio

ETFs and ETPs AuM US$ B

209

ETFs

US$ 55B MSCI

Growth in MSCI ESG ETFs vs. rest of the market

ETF AuM tracking 

MSCI ESG Indices

ETF AuM tracking 

other ESG indices 

160

ETFs

Other

Drivers for listing of MSCI ESG Index Futures

Fast growing Investors’ interest for derivatives solutions

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As of June 2020, 141% 

growth YOY in ETF AuM

tracking MSCI ESG Indices 

~ up US$22B YTD 
INTERCONTINENTAL EXCHANGE

MSCI ESG Leaders Index Futures

Fast growing indices, designed to provide a Best in Class approach

Increase overall ESG score while

maintaining Replicability and Limit

Biases:

• Includes the best MSCI ESG Rated

companies in each sector

• Market cap coverage of 50% of the Parent

Index with similar sector and region profile

• Seamless integration alongside the Parent

Index with Free float market cap weighted

Achieve maximum Carbon exposure

reductionwhile limiting trackingerror:

• Climate Change Index is a Forward looking

index that seeks to increase exposure to

companies that will benefit from a transition

to Low CarbonEconomy

• Low Carbon Index is a Current looking

index seeks to increase exposure to Carbonefficient companies and lower the weight to

large current and future carbon emitters

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INTERCONTINENTAL EXCHANGE

Challenges

• Standardizing the reference data sets 

➢ Different voluntary disclosure regimes

➢ Non standard set of values/metrics used

➢ Lack of comparable ESG data

• Gather market participants around 

common ESG methodologies and Index 

Families

➢ Many rating agencies and methodologies

➢ Index Providers compete to establish standards

• Diverging ESG Regulatory Regimes

➢ Comprehensive EU ESG Regime, Taxonomy & 

NFRD 

➢ Market demand driven US 

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A new world of sustainable finance to define

10-500 Data 

points evaluated by an ESG 

rater

>100 

Different ESG rating 

agencies

“Sustainable 

investment” in EU 

taxonomy is an economic 

activity that contributes to 

one of 6 environmental 

objectives
INTERCONTINENTAL EXCHANGE

Opportunities

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Source: “The Global Risks Report 2020” World Economic Forum

2020 Global Risks Report

For the first time, the top 5 Long Term 

Risks Likelihood perceived are ALL 

Environmental

• Index Provider Increased 

Transparency

➢ Reference Data

➢ Clearly Defined Methodology

• Addressing Climate Change 

and ESG integration

➢ Environmental Risks 

perceived across the World

➢ All major regions participating

• Growing Ecosystem of 

Green Financial Instruments

➢ ESG integration cross asset 

classes
INTERCONTINENTAL EXCHANGE

ICE Disclaimer

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