Company News » Firms axed after FTSE4Good review

Cairn Energy, the UK oil and gas producer, has been taken off the
responsible investment index as part of a weeding out of firms that do not
comply with new climate change criteria.

In a half-yearly review, Cairn Energy was the only UK company dropped from
the index.

Otherwise, the UK became a dominant force in the responsible investment
index, with 12 new UK companies being accepted as constituents. Japan saw three
of its companies kicked off, but 11 new ones admitted.

The seven deletions from the index as a result of the climate change
requirements are:
• Asahi Glass, Japan;
• Hitachi Metals, Japan;
• Tokuyama Corporation, Japan;
• HeidelbergCement, Germany;
• Lanxess, Germany; and
• Eastman Chemical, US.
An independent panel audits the companies to be included in the index, with
members including representatives from Legal & General and Barclays.

One year ago, the index outlined new criteria involving companies that wanted
to be included having to prove adherence to climate change requirements, in
addition to existing requirements such as human rights, countering bribery and
supply chain labour standards criteria.

The FTSE is to implement more requirements relating to carbon dioxide
emissions. By July, companies deemed ‘high-operational impact’ by the compilers
will have to comply with new management and performance requirements, such as
identifying long-term strategic goals for reducing their carbon emissions. Those
deemed a medium-operational impact company will not have to comply with those
requirements until January 2009.