TSX to Roll Out ESG indices Based on S&P/TSX Composite Index and S&P/TSX 60 Index

Growing investor focus on sustainability and environmental, social and governance (ESG) topics are driving demand for ESG investment products and ways to measure ESG, with indices increasingly meeting this need. As investors look increasingly through an ESG lens, TSX will launch six new ESG indices with our index partner, S&P Dow Jones Indices, in July and August. The indices will be based on the S&P/TSX Composite Index and S&P/TSX 60 Index and will help investors benchmark through an ESG lens, execute ESG mandates and measure the sustainability of their portfolios.

The ESG indices will include constituents of the underlying index that also meet the stated ESG criteria of the index. Each index' overview is outlined below, along with the process for companies to contribute to their S&P DJI ESG Score. ESG versions of the primary benchmarks will launch on July 27, 2020. Complete methodologies for ESG indices will be available on August 3, 2020 on both TMX.com and SPglobal.com/spdji.

S&P DJI ESG Scores, which determine whether a company is included in the S&P/TSX Composite ESG Index and S&P/TSX 60 ESG Index, are based on information collected by SAM, part of S&P Global. SAM administers a Corporate Sustainability Assessment survey (CSA) to roughly 100 of the largest market capitalization TSX issuers each year. TSX Composite constituents who have not previously been part of the CSA invited group, will receive a CSA invitation in the coming weeks. Companies that choose not to actively participate in the SAM CSA are assessed based on the company's publicly available information, such as ESG reports and annual reports. Every company has a score regardless of data collection method. Inquiries about CSA and data collection can be directed to the CSA Helpline at csa@spglobal.com.

The S&P/TSX Composite ESG Index is designed to measure the performance of constituents meeting sustainability criteria, while maintaining similar overall industry group weights as the S&P/TSX Composite Index. The ESG version targets 75% of the float capitalization of each GICS® industry group within the S&P/TSX Composite Index, using S&P DJI ESG Scores for constituent selection.

The S&P/TSX 60 ESG Index is designed to track the performance of the constituent companies of the S&P/TSX 60 Index, while taking into account each company's S&P DJI ESG Scores. Companies are re-weighted according to their sustainability score and relative to industry-specific standards. A higher sustainability score corresponds with a higher index weight relative to a constituent's weight in the S&P/TSX 60 Index.

S&P/TSX ESG indices are rebalanced annually each March, with eligible companies being those that are included in the underlying index as of the same date. Companies that are removed from the underlying index throughout the twelve month period following annual rebalance will also be removed from the corresponding ESG index. Certain qualifications can preclude a company from being considered for the ESG indices, such as involvement in specific industries including controversial weapons, sales of tobacco products and services exceeding stated thresholds, or a very low UNGC score.

Another integral part of TSX' ESG index suite is climate measures, including initially, Carbon Price Risk Indices and Carbon Efficient Indices. The indices were designed in conjunction with S&P Trucost Limited (Trucost), environmental data specialists, and using Trucost climate data. The indices will be launched on July 27, 2020 and August 24, 2020, respectively.

The S&P/TSX Composite Carbon Price Risk Index and S&P/TSX 60 Carbon Price Risk Index measure the performance of the constituent companies of the underlying index, reweighted to account for the potential impact of 2030 carbon prices on constituents' valuations. The S&P Carbon Price Risk 2030 Adjusted Index Series aims to rebalance index constituents in a way that adjusts for their differing levels of future carbon price risk, based on pricing risks arising from industry and geographic distribution of emissions, as well as levels of emissions.

The S&P/TSX Composite Carbon Efficient Index and S&P/TSX 60 Carbon Efficient Index are designed to closely track the performance of the underlying benchmark, while significantly reducing the overall carbon footprint of the portfolio. Weights of the constituents will be based on TruCost carbon footprint and GICS® industry group. The existing S&P/TSX 60 Carbon Efficient Index will be decommissioned in favour of the newer methodology.

Products, such as ETFs and derivatives tracking the new ESG indices are expected to launch over the next six months.

After index launch, questions about indices, methodologies and index inclusion should be directed to S&P DJI Index services at index_services@spglobal.com.

_{The S&P/TSX Composite Index, the S&P/TSX Venture Composite Index and all other S&P/TSX Indices referred to herein are products of S&P Dow Jones Indices LLC or its affiliates ("SPDJI") and TSX Inc. ("TSX"). Standard & Poor's® and S&P® are registered trademarks of Standard & Poor's Financial Services LLC ("S&P"); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC ("Dow Jones"); and TSX® is a registered trademark of TSX. SPDJI, Dow Jones, S&P, their respective affiliates and TSX do not sponsor, endorse, sell or promote any products based on the S&P/TSX Indices and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions or interruptions of the S&P/TSX Indices or any data related thereto.}