NSE's latest index lets you invest in companies following ahimsa
What's the story
NSE Indices Limited, the index services subsidiary of the National Stock Exchange (NSE), has launched the Nifty500 Ahimsa Index. The index tracks companies from the Nifty 500 universe whose business practices align with the principles of ahimsa or non-violence. The move is aimed at investors looking for exposure to businesses that do not engage in activities harmful to animals or mankind.
Index development
Developed in partnership with the Ahimsagain Foundation
The Nifty500 Ahimsa Index has been developed in partnership with the Ahimsagain Foundation. It is based on the foundation's Ahimsa Investment Movement (AIM) framework, which evaluates companies based on how well their products, services, and business practices align with ahimsa principles. Under this framework, companies are classified into three categories: Green (aligned), Orange (moderate concerns), and Red (significant involvement in harmful activities).
Inclusion criteria
Only companies classified as 'Green' are eligible for inclusion
Only companies classified as 'Green' under the AIM framework are eligible for inclusion in the Nifty500 Ahimsa Index. Those placed in the Orange and Red bands are excluded. This ensures that only businesses demonstrating a strong commitment to responsible and sustainable practices are included in this unique index, which combines ethical investment considerations with broad-based exposure to the equity market.
Future prospects
The index will be reconstituted semi-annually
The Nifty500 Ahimsa Index is also expected to serve as a benchmark for asset managers and aid in the creation of passive investment products such as exchange-traded funds (ETFs), index funds, and other structured investment solutions. The index has a base date of April 1, 2016, with a base value of 1,000. It will be reconstituted semi-annually with each stock's weight determined by its free-float market capitalization.