FTSE Russell has published its Statement of Compliance with the recommendations made by the International Organisation of Securities Commissions (Iosco), as laid out in the Principles for Financial Benchmarks and published in July 2013 (the Iosco Principles).
There are more than 1,000 structured products featuring FTSE benchmarks including the FTSE Global Equity Index Series, FTSE EPRA/NAREIT; and FTSE China 50 across markets, of which 551 are featured in live products; as well as over 5,000 products featuring Russell indices including 5,443 products featuring the Russell 2000, 14 products using the Russell 1000 and the Russell 1000 Growth, respectively; and seven linked to Russell 1000 Value.
The Iosco Principles aim to promote the reliability of benchmarks addressing issues surrounding governance; the quality of benchmark design and methodology; and the accountability of the benchmark administrator.
The index provider stated that it is committed to leading best global practice standards following the publication of its first statement in July 2014.
FTSE first announced its compliance with Iosco’s Principles for Financial Benchmarks in July 2014, and we are pleased to confirm that the combined FTSE Russell entity can now do the same, said Chris Woods, managing director governance, risk & compliance at FTSE Russell.
“We support and welcome the various regulatory initiatives which are designed to ensure that benchmarks are maintained according to robust and transparent methodologies, and that benchmark administrators have strong and independent governance structures in place,” said Woods. “This can only be beneficial in the long term as it provides index users with greater confidence in the industry.”
FTSE Russell will continue observing strong governance controls, “which benefit from robust procedures and experienced internal working groups”, supported by external advisory committees. This statement, said the index provider, also underpins the quality of FTSE Russell benchmarks and gives index users confidence that they accurately reflect the value of the asset classes being measured.
FTSE Russell is committed to promoting the highest possible governance standards within the industry and has endorsed its objectives to address conflicts of interest in the benchmark-setting process, enhance the reliability of benchmark determinations, and promote transparency and openness in all benchmark decisions, said Mark Makepeace, CEO of ESG, FTSE Russell, in a statement.
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