Starting with the largest listed companies in the world by market capitalization (approx. 1645), Osmosis analyses the disclosing universe of public companies, i.e. the world’s largest public companies that disclose sufficiently on their energy consumption, waste creation and water consumption, in the public domain through their annual reports and sustainability reports. Only companies which disclose on GHG Equivalent Emissions, water consumption and waste generation will be scored. These factors are combined and calculated into a Resource Efficiency Factor Score, i.e. for each stock within the universe of companies disclosing environmental and resource efficiency data a unique multi-factor score is calculated.
The Resource Efficiency Factor Scores are analysed within their sector and re-calculated in respect of each company upon publication it’s newly released environmental data. A company that either does not disclose sufficiently on the three resource consumption factors (energy, water and waste) or is within the financial & REITs sector, receives a zero factor score within the tight tracking error portfolios, and is currently excluded from the high active risk and style portfolios, which selection pool is reduced toa pool of ~695 companies.