The Green Economy – a new growth market

When investors think of ‘green’, often their first thought is of renewable energy and obvious clean technologies such as electric cars. But the green economy is extremely diverse. It is made up of companies and investment vehicles of all sizes, in all geographies and almost every industry.

But without a specific industrial classification, it can be challenging to identify an investible universe of ‘green’ equities – and highlight your business to investors.

That’s why London Stock Exchange has developed the Green Economy Classification and Mark.

Our Green Economy Mark provides clarity

London Stock Exchange Group’s Green Economy Mark was created to help investors and issuers address this information gap and facilitate investment.

It identifies listed companies and funds that generate over 50% of their total annual revenues from products and services across all industries that contribute to the global green economy.

For the first time, investors can see beyond the ‘pure play’ green companies, to those that have a growing business activity in this area. Consider the ways this could benefit your company...

Features of the Green Economy Mark
  • Accessibility: The Mark is available to qualifying equity issuers (both companies and listed funds) on all segments of London’s Main Market and AIM.
  • Visibility: It improves the visibility of companies and funds that are making a material contribution to the Green Economy.
  • Community: Be part of a cohort of Green Economy companies and funds invited to dedicated events, and collectively supported by our Green Economy experts.
Benefits of the Mark to issuers
  • Existing Issuers: Raise your profile among Green Sector investors, as an added-value benefit included within your current listing fees (in addition to all current listing benefits).
  • New Issuers: Gain additional profile at IPO as a new Green Economy issuer – to broaden and diversify your investor base.
  • All Issuers: Align your disclosures with the index inclusion requirements of FTSE Russell – as used by the largest asset owners and asset managers worldwide.

London’s Green Economy in focus

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Green Economy companies are listed on London Stock Exchange
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Aggregate market capitalisation of Green Economy companies on London Stock Exchange’s markets
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Total annual revenues from green activities in order to qualify as a Green Economy company

Qualifying for the Green Economy Mark

The Green Economy Mark can be awarded to equity issuers listed on London Stock Exchange’s Main Market or AIM, in any segment.

You do not need to be a ‘pure play’ green company in order to obtain a Green Economy Mark – but you must generate material revenue from green activities (50%+).

Your company or fund can qualify for our Green Economy Mark in a number of ways:

  • If you are covered by FTSE Russell’s Research for Green Revenues with green revenues exceeding 50% of annual revenue.
  • If you disclose revenues aligned with FTSE Russell’s Green Revenues Taxonomy that in aggregate represent 50% or more of your total annual revenue in your audited financial accounts.
  • If you are included in the FTSE Environmental Technology Index Series.
  • If your listed fund can demonstrate to the satisfaction of London Stock Exchange that the fund’s activities are aligned with the FTSE Russell Green Revenues Taxonomy.

Insights from the Green Economy

London Stock Exchange has been helping issuers raise green finance for many years, to support the transition to a sustainable low-carbon economy.

Energising finance for The Renewables Infrastructure Group (TRIG)

Renewable energy funds are an important structure that drive capital to the green economy. Listed green funds have been a success story at the London Stock Exchange Group, with 22 green funds with a collective market capitalisation of £8.7 billion. Around half of these focus on renewable energy projects worldwide, while others focus on clean technologies such as energy storage and energy efficiency.

The Renewables Infrastructure Group (TRIG) was admitted onto the Premium segment of London Stock Exchange main market in 2013, and invests in a range of operational renewable energy assets. TRIG is invested in over 70 wind, solar and battery storage assets across Europe with an aggregate generating capacity in excess of 1.5GW. Its market capitalisation has increased by more than 380% since listing, currently £1.83 billion.

Green ‘Yieldco’ model thrives in London

Yieldcos are a particular type of Listed Closed-End Fund, that have been used in the energy sector for some time. They are now increasingly popular in relation to clean energy technologies.

Of London’s 22 green funds, 12 are Yieldcos, with focus ranging from global renewable energy generation from multiple sources, to battery storage and energy efficiency. Yieldcos currently on the London market have an aggregate market capitalisation of over £7.5 billion.

Your Guide to Green Finance

Learn more about the green economy and sustainable finance opportunities in this helpful guide to 'Navigating the Green Finance Landscape'.

The guide explains the policy and market context of green finance – and how London’s issuers are using green finance tools to support their growth and the transition to a sustainable low-carbon economy. Access your copy now.

Download the guide

Estimate your ESG disclosure score

A company’s ESG Disclosure Score reflects its levels of transparency and disclosure of the most financially material Environmental, Social, and Governance data and metrics. It enables companies in all industries to compare their performance with their peer group and best practice.

Use this quick online assessment tool to estimate your ESG Disclosure Score in relation to the industry benchmark for your sector.

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Contact us to learn more

To discuss your sustainable finance and green investment options in London, please complete the contact form.

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