Also known as: M9CXJESR Index (Bloomberg) · 713538 (MSCI code)
At a glance
- Review frequencySemi-annual
- Constituent count50
| Field | Value | Source text | Reading (model) |
|---|---|---|---|
| M1 Identity, objective, classification · 10 fields | |||
| Weighting method | free float-adjusted market capitalization-weighted | is a free float-adjusted market capitalization-weighted indexOpen p.3 ↗ |
The index is free float-adjusted market capitalization weighted. |
| Sector coverage target | 50% | The Index construction has a target coverage of 50% by number of securities in each Global Industry Classification Standard (GICS®)1 sectorOpen p.3 ↗ |
Index construction targets 50% by number of securities in each GICS sector of the Parent Index. |
| Index name | MSCI Nihonkabu ESG Select Leaders Index | The MSCI Nihonkabu ESG Select Leaders Index (the “Index”) is a free float-adjusted market capitalization-weighted indexOpen p.3 ↗ |
The official index name is the MSCI Nihonkabu ESG Select Leaders Index. |
| Administrator | MSCI Limited; MSCI Deutschland GmbH | MSCI Indexes are administered by MSCI Limited and MSCI Deutschland GmbH.Open p.8 ↗ |
MSCI Indexes are administered by MSCI Limited and MSCI Deutschland GmbH. |
| Index family | MSCI Nihonkabu ESG Select Leaders | MSCI Nihonkabu ESG Select Leaders Index MethodologyOpen p.1 ↗ |
The index belongs to the MSCI Nihonkabu ESG Select Leaders methodology family. |
| Parent index | MSCI Nihonkabu Investable Market Index | selected from the MSCI Nihonkabu Investable Market Index (“Parent Index”) based on Environmental, Social and Governance (“ESG”) criteria.Open p.3 ↗ |
The Parent Index is the MSCI Nihonkabu Investable Market Index. |
| Objective | The Index is designed to represent the performance of companies selected from the MSCI Nihonkabu Investable Market Index based on ESG criteria. | designed to represent the performance of companies that are selected from the MSCI Nihonkabu Investable Market Index (“Parent Index”) based on Environmental, Social and Governance (“ESG”) criteria.Open p.3 ↗ |
The index is designed to represent the performance of Parent Index companies selected using Environmental, Social and Governance criteria. |
| Market classification | Developed | MSCI Nihonkabu Investable Market IndexOpen p.3 ↗ |
The index targets Japanese equities, which are classified as a developed market. |
| Size segment | IMI | MSCI Nihonkabu Investable Market Index (“Parent Index”)Open p.3 ↗ |
The parent index is an Investable Market Index, indicating an IMI size segment. |
| Index family type | ESG | based on Environmental, Social and Governance (“ESG”) criteria. These criteria exclude constituents based on involvement in specific business activities, as well as ESG ratings and exposure to controversies.Open p.3 ↗ |
The index is an ESG index because constituents are selected based on ESG ratings, scores, controversies and business involvement criteria. |
| M2 Universe · 3 fields | |||
| Underlying universe definition | constituents of the Parent Index | The Underlying Universe for the Index is defined by the constituents of the Parent Index.Open p.4 ↗ |
The underlying universe consists of constituents of the Parent Index. |
| Markets | Japan | MSCI Nihonkabu Investable Market Index (“Parent Index”)Open p.3 ↗ |
The index covers Japanese equities through the MSCI Nihonkabu Parent Index. |
| Parent universe index | MSCI Nihonkabu Investable Market Index | The Underlying Universe for the Index is defined by the constituents of the Parent Index.Open p.4 ↗ |
The underlying universe is defined by constituents of the MSCI Nihonkabu Investable Market Index. |
| M3 Eligibility screens · 7 fields | |||
| ESG rating minimum | BB | Companies are required to have an MSCI ESG Rating of ‘BB’ or above to be eligible for inclusion in the Index.Open p.4 ↗ |
Companies must have an MSCI ESG Rating of BB or above to be eligible. |
| Controversies score minimum | 3 | Companies are required to have an MSCI Controversies Score of 3 or above to be eligible for inclusion in the Index.Open p.4 ↗ |
Companies must have an MSCI Controversies Score of 3 or above to be eligible. |
| Unrated company rule | Companies not assessed by MSCI ESG Ratings or MSCI Controversies are ineligible. | Companies not assessed by MSCI Solutions on data for any of the following MSCI sustainability and climate products are not eligible for inclusion in the Index. MSCI ESG Ratings MSCI ControversiesOpen p.4 ↗ |
Companies without assessments for the required MSCI sustainability products are not eligible for inclusion. |
| ESG data provider | MSCI Solutions LLC | company ratings and research produced and provided by MSCI Solutions LLC (MSCI Solutions), a subsidiary of MSCI Inc.Open p.8 ↗ |
MSCI Solutions LLC produces and provides the company ratings and research used by the index. |
| ESG rating scale | AAA to CCC | translated to a seven-point scale from ‘AAA’ to ‘CCC’, indicating how an entity manages relevant key issues relative to industry peers.Open p.8 ↗ |
MSCI ESG Ratings use a seven-point scale from AAA to CCC based on an industry-adjusted ESG score from 0 to 10. |
| Controversies score scale | 0-10 | MSCI Controversies Score falls on a 0-10 scale, with “0” being the most severe controversy.Open p.8 ↗ |
MSCI Controversies Scores range from 0 to 10, with 0 indicating the most severe controversy. |
| Business or ESG exclusions | Companies involved in specific business activities are excluded., Companies must have an MSCI ESG Rating of BB or above., Companies must have an MSCI Controversies Score of 3 or above., Companies not assessed by MSCI ESG Ratings or MSCI Controversies are ineligible. | These criteria exclude constituents based on involvement in specific business activities, as well as ESG ratings and exposure to controversies.Open p.3 ↗ |
Eligibility excludes companies involved in specified business activities, companies below BB ESG rating, companies below a Controversies Score of 3, and unrated companies. |
| M4 Selection and constituent count · 8 fields | |||
| Cumulative selection order | Steps: Step order: 1; Rule: Select securities in the top 35% of the ranked universe, including the first security that takes cumulative coverage above 35%; Threshold (%): 35, Step order: 2; Rule: Select AAA and AA rated securities in the top 50% of the ranked universe, including the first security that takes cumulative coverage above 50%; Threshold (%): 50; Ratings: AAA, AA, Step order: 3; Rule: Select current constituents in the top 65% of the ranked universe, including the first security that takes cumulative coverage above 65% if it is a current constituent; Threshold (%): 65, Step order: 4; Rule: Select remaining eligible securities in the ranked universe until the sector target is reached | For each sector, eligible securities of the Parent Index are then selected from the Ranked Universe in the following order until the target coverage of 50% by number of securities within each sector is reachedOpen p.5 ↗ |
Securities are selected by sector in four ranked-universe priority steps until the 50% sector coverage target is reached. |
| Marginal security rule | Definition: The security that increases cumulative sector coverage above 50%; Current constituent: always selected; Non constituent: selected only if coverage including the security is closer to 50% than coverage excluding it; if equally close, it is not selected; Minimum coverage (%): 45; Minimum coverage override: The marginal security is always selected if required to reach 45% cumulative sector coverage | MSCI defines the security that increases the cumulative sector coverage above 50% as the “marginal security”. − If the marginal security is a current constituent of the Index, then it is always selected.Open p.9 ↗ |
The marginal security that crosses 50% sector coverage is always retained for current constituents and selected for non-constituents only when it brings coverage closer to 50%, except it is always selected if 45% minimum coverage requires it. |
| Ineligible securities not backfilled | Yes | Securities which are ineligible as per Section 3.1.1 will not be selected even if the cumulative sector coverage after selection of all eligible securities is below 50%.Open p.9 ↗ |
Securities ineligible under Section 3.1.1 are not selected, even if selecting all eligible securities leaves sector coverage below 50%. |
| Selection method | Rank by metric | For each sector, eligible securities of the Parent Index are ranked based on the following criteriaOpen p.5 ↗ |
Eligible Parent Index securities are ranked within each GICS sector and selected according to ranking-based coverage rules. |
| Ranking metrics | Name: ESG rating; Direction: Rating order with company level rating first; Step order: 1, Name: Current index membership; Direction: Existing constituents priority over non constituents; Step order: 2, Name: Industry adjusted ESG score; Direction: Higher score priority; Step order: 3, Name: Free float adjusted market capitalization; Direction: Decreasing; Step order: 4 | For each sector, eligible securities of the Parent Index are ranked based on the following criteria: ESG Rating Current index membership (existing constituents above non-constituents) Industry-adjusted ESG scores Decreasing free float-adjusted market capitalizationOpen p.5 ↗ |
Within each sector, securities are ranked by ESG rating, current membership priority, industry-adjusted ESG score, and decreasing free float-adjusted market capitalization. |
| Target constituent count | 50 percent by number of securities per gics sector | The Index has a target coverage of 50% by number of securities in each Global Industry Classification Standard (GICS®) sector of the Parent IndexOpen p.4 ↗ |
The index targets 50% coverage by number of securities within each GICS sector of the Parent Index. |
| Tie break rule | After equal ESG rating, current constituents rank ahead; among tied current constituents, higher industry-adjusted ESG score wins, then larger free float-adjusted market capitalization. | If two securities have the same ESG Rating, the existing Index constituent is given priority to maintain index stability. Between two existing constituents of the Index with the same ESG Rating, the security with the higher industry-adjusted ESG Score is given priority.Open p.9 ↗ |
If ESG ratings tie, existing constituents receive priority; for tied existing constituents, the higher industry-adjusted ESG score ranks first, and if still tied, the larger free float-adjusted market capitalization ranks first. |
| Industry neutrality rule | Selection is performed separately for each GICS sector to target 50% sector coverage by number of Parent Index securities. | The Index has a target coverage of 50% by number of securities in each Global Industry Classification Standard (GICS®) sector of the Parent IndexOpen p.4 ↗ |
The index balances selection by applying the ranking and selection process independently within each GICS sector to a 50% by-number coverage target. |
| M6 Review and rebalance schedule · 8 fields | |||
| Semi annual review reassessment | At each Semi-Annual Index Review, the eligible universe is updated and index composition is reassessed to target the top 50% by number of securities within each GICS sector based on the ranking criteria. | At each Semi-Annual Index Review, the eligible universe is updated, and the composition of the Index is reassessed to target the top 50% by number of securities within each Global Industry Classification Standard (GICS®) sector of the Parent IndexOpen p.5 ↗ |
At semi-annual reviews, MSCI updates the eligible universe and reassesses composition to target the top 50% by security count within each GICS sector. |
| Quarterly review additions | At quarterly reviews, ineligible existing constituents are deleted, eligible constituents are retained, and additions are made only in sectors with coverage below 45% until the 50% target is reached. | At the Quarterly Index Reviews, existing constituents are deleted from the Index if they do not meet the eligibility criteria described in Section 2.2. Existing constituents that meet the eligibility criteria are retained in the Index.Open p.6 ↗ |
Quarterly reviews remove ineligible holdings and add eligible securities only in sectors under 45% coverage until 50% coverage is reached. |
| Review frequency | Semi-annual | The Index is reviewed on a semi-annual basis in May and November to coincide with the May and November Index Reviews of the Parent Index, and the changes are implemented at the end of May and November.Open p.5 ↗ |
The index is reviewed on a semi-annual basis in May and November, with changes implemented at the end of those months. |
| Review types | Semi annual review, Quarterly review | The Index is reviewed on a semi-annual basis in May and November to coincide with the May and November Index Reviews of the Parent IndexOpen p.5 ↗ |
The index has Semi-Annual Index Reviews and Quarterly Index Reviews. |
| Review months | February, May, August, November | The Index is reviewed on a semi-annual basis in May and November to coincide with the May and November Index Reviews of the Parent IndexOpen p.5 ↗ |
Index reviews occur in February, May, August, and November. |
| Data cutoff rule | MSCI ESG Ratings, MSCI Controversies Scores, and other MSCI Solutions data are generally used as of the end of the month preceding the index review; later-published ESG data may be used when available. | In general, MSCI uses MSCI Solutions data (including MSCI ESG Ratings and MSCI Controversies Scores) as of the end of the month preceding the Index Reviews for the rebalancing of the Index.Open p.5 ↗ |
Review data generally use MSCI Solutions data, including ESG Ratings and Controversies Scores, as of the end of the preceding month, with later-published ESG data used if available. |
| Announcement rule | The pro forma index is generally announced nine business days before the effective date. | In general, the pro forma index is announced nine business days before the effective date.Open p.5 ↗ |
The pro forma index is generally announced nine business days before the changes become effective. |
| Effective date rule | Changes are implemented at the end of February, May, August, and November. | the changes are implemented at the end of May and November.Open p.5 ↗ |
Semi-annual changes take effect at the end of May and November, and quarterly changes at the end of February and August. |
| M7 Buffers and turnover control · 1 field | |||
| Sector coverage buffer | Target coverage (%): 50; Under representation threshold (%): 45; Buffer (%): 10 | Additions from the eligible securities as per Section 2.2 are made only to those sectors where the current coverage by number of securities is less than 45%, until the 50% target is reached.Open p.6 ↗ |
A 10% buffer is applied to the 50% sector-coverage target, so additions at quarterly reviews occur only where sector coverage is below 45%. |
| M8 Corporate actions, IPOs, ad-hoc changes · 8 fields | |||
| Parent index linkage | Interim additions occur only when securities are added to the Parent Index, and Parent Index deletions are reflected simultaneously. | For cases where additions are noted below, securities will be added to the index only if added to the Parent Index. Parent Index deletions will be reflected simultaneously.Open p.6 ↗ |
Between scheduled reviews, additions are linked to Parent Index additions, and deletions from the Parent Index are reflected at the same time. |
| Characteristics change treatment | A security remains in the index after changes in characteristics such as country, sector, or size segment, with continued inclusion reevaluated at the subsequent review. | A security will continue to be an Index constituent if there are changes in characteristics (country, sector, size segment, etc.). Reevaluation for continued inclusion in the Index will occur at the subsequent Index Review.Open p.7 ↗ |
Changes in country, sector, size segment, or similar characteristics do not trigger immediate removal; continued inclusion is reviewed later. |
| No interim ESG deletion | Yes | There are no deletions from the Index between Index Reviews on account of a security becoming ineligible because of MSCI ESG Rating downgrade and/or decrease in MSCI Controversies Score.Open p.6 ↗ |
Securities are not deleted between index reviews solely because of an MSCI ESG Rating downgrade or lower MSCI Controversies Score. |
| Fast entry | Timing: On the date the security is added to the Parent Index | New securities added to the Parent Index (such as IPOs, other early inclusions and migrations from a different size-segment) will be added to the Index on the date of security inclusion only if they meet the eligibility criteria described in Section 2.2 and the market capitalization coverage of the sector to which the security belongs is less than 45%.Open p.7 ↗ |
New Parent Index securities, including IPOs, other early inclusions, and size-segment migrations, are added on the Parent Index inclusion date only if they meet Section 2.2 eligibility criteria and the sector's market-capitalization coverage is below 45%. |
| Ad-hoc deletion | Acquisition, Other | Parent Index deletions will be reflected simultaneously.Open p.6 ↗ |
An existing constituent acquired by a non-constituent is deleted, and Parent Index deletions are reflected simultaneously; ESG rating or controversies-score downgrades alone do not cause interim deletion. |
| Replacement policy | Next review | No new securities will be added (except where noted below) to the Index between Index Reviews.Open p.6 ↗ |
No general new securities are added between reviews, and securities created in spin-offs are reconsidered for addition only at the subsequent Index Review. |
| Merger spinoff rules | Spin-off securities are not added at event implementation and are reevaluated at the subsequent review; if an existing constituent is acquired by a non-constituent, the constituent is deleted and the acquirer is not added. | Spin-Offs All securities created as a result of the spin-off of an existing Index constituent will not be added to the Index at the time of event implementation. Reevaluation for addition in the Index will occur at the subsequent Index Review.Open p.7 ↗ |
Spin-off securities are deferred to the next review, while an acquired index constituent is deleted and the non-constituent acquirer is not added. |
| Corporate actions guide ref | MSCI Corporate Events Methodology book | Further detail and illustration regarding specific treatment of corporate events relevant to this Index can be found in the MSCI Corporate Events Methodology book.Open p.7 ↗ |
Further corporate-event treatment is provided in the MSCI Corporate Events Methodology book. |
| M10 Governance, change policy, disclosure · 3 fields | |||
| Methodology set documents | Description of methodology set, MSCI Corporate Events Methodology, MSCI Fundamental Data Methodology, MSCI Index Calculation Methodology, MSCI Index Glossary of Terms, MSCI Index Policies, MSCI Global Industry Classification Standard (GICS) Methodology, MSCI Global Investable Market Indexes Methodology, ESG Factors in Methodology | The Index is governed by a set of methodology and policy documents (“Methodology Set”), including the present index methodology document as mentioned below:Open p.10 ↗ |
The index is governed by a methodology set comprising the index methodology and related MSCI methodology, policy, glossary, calculation, corporate events, fundamental data, GICS, GIMI, and ESG documents. |
| Methodology set access channel | https://www.msci.com/index-methodology | The Methodology Set for the Index can also be accessed from MSCI’s webpage: https://www.msci.com/index-methodology in the section ‘Search Methodology by Index Name or Index Code’.Open p.10 ↗ |
The methodology set can be accessed on MSCI's index methodology webpage by searching the index name or code. |
| ESG methodology document scope | ESG Factors in Methodology lists environmental, social, and governance factors and explains their application in selection, weighting, or exclusion. | ‘ESG Factors in Methodology’ contains the list of environmental, social, and governance factors considered, and how they are applied in the methodology (e.g., selection, weighting or exclusion).Open p.10 ↗ |
The ESG Factors in Methodology document identifies the ESG factors considered and describes how they are applied in selection, weighting, or exclusion. |
Open points · 48Model-written, for reference
- 1Index short name or abbreviation was not stated.
- 2Local-language index name was not stated.
- 3Vendor index code, ISIN, and third-party tickers such as Bloomberg or Refinitiv were not stated.
- 4Calculation agent, if different from the administrators, was not stated.
- 5Launch date, base date, base value, currency, methodology version, methodology date, and benchmark regulatory status were not stated.
- 6Stated intended uses, factor exposures, and index limitations were not provided.
- 7Specific exchanges, listing boards, security type enumerations, nationality rule, and universe security-kind exclusions were not stated.
- 8Minimum trading history, liquidity screen, size threshold, free-float threshold, foreign room, voting rights, share-price screen, financial screens, suspension rule, and extreme-price screen were not stated.
- 9The specific business activities triggering exclusions were referenced but not listed.
- 10No reserve-list size or replacement-candidate rule was stated.
- 11Weighting scheme was not stated, although free float-adjusted market capitalization is used as a ranking criterion.
- 12Free float factor methodology or bands were not stated.
- 13Domestic inclusion factor treatment was not stated.
- 14Foreign ownership limits and their effect on weights were not stated.
- 15Single-issuer, group, sector, or country weight caps were not stated.
- 16Cap application timing was not stated.
- 17Shares outstanding source and update timing were not stated.
- 18Divisor adjustment continuity rules were not stated.
- 19No explicit standalone weight-rebalancing or weight-reset frequency separate from the May/November and February/August reviews was stated.
- 20No rank buffer or standard size-segment buffer was stated.
- 21No relaxed liquidity threshold for existing constituents was stated.
- 22No maximum constituent-count or weight turnover cap per review was stated.
- 23No numerical market-capitalization threshold for fast entry or excluded boards were stated; early inclusion is conditioned on Parent Index addition, eligibility, and sector coverage below 45%.
- 24No deletion price was stated.
- 25No threshold for implementing share or free-float changes between reviews was stated.
- 26Formula type is not stated.
- 27Price source is not stated.
- 28Calculation frequency is not stated.
- 29Calculation returns.precision is not stated.
- 30Return variants is not stated.
- 31Withholding tax basis is not stated.
- 32Dividend treatment is not stated.
- 33Divisor adjustment events is not stated.
- 34Market disruption rule is not stated.
- 35Recalculation policy is not stated.
- 36Oversight body is not stated.
- 37Discretion points is not stated.
- 38Methodology review frequency is not stated.
- 39External review is not stated.
- 40Material change definition is not stated.
- 41Consultation procedure is not stated.
- 42Notice period is not stated.
- 43Error correction policy is not stated.
- 44Disclosure channels beyond the methodology-set webpage are not stated.
- 45Constituents published is not stated.
- 46Cessation policy is not stated.
- 47Not coveredM5 Weighting and capping: not covered by this edition
- 48Not coveredM9 Calculation and return variants: not covered by this edition
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