Mumbai's BSE Index Services has introduced the new Saatvik 100 Index, establishing a dedicated benchmark for investors focused on ethical and value-based investment principles. This development is set to provide a structured reference point for India's growing ethical investing ecosystem.
The Wealth Company Mutual Fund has welcomed the launch, stating that its existing Ethical Fund, which operates on 'Good Karma' investing principles rooted in Ahimsa and Saatvik living, closely mirrors the philosophy and constituent profile of the new index. A review of the Saatvik 100 Index's methodology confirms significant similarities with the fund's established framework.
Principles of Ethical Investment
The core of both the BSE Saatvik 100 Index and The Wealth Company Ethical Fund lies in stringent exclusions. Businesses involved in alcohol, tobacco, gambling, vulgar entertainment, narcotic substances, leather, meat and poultry, pesticides, insecticides, and animal cruelty are excluded from their investment universe. This approach distinguishes them from traditional market-cap-based or even conventional Shariah-based screenings, by incorporating a broader ethical framework that includes governance standards and financial prudence.
The index's sector composition, predominantly featuring financial services, technology, telecommunications, and industrial companies, aligns broadly with The Wealth Company's investment universe. Notably, the inclusion of financial services firms in the index is a positive aspect for the fund house, as its Ethical Fund consciously built flexibility to invest in select financial businesses, unlike many traditional Shariah benchmarks that often restrict this sector.
Madhu Lunawat, Founder, Managing Director, and CEO of The Wealth Company Mutual Fund, described the index's introduction as a "landmark moment" for ethical investing in India. "When we launched The Wealth Company Ethical Fund, our vision was to create an investment product rooted in the principles of Ahimsa, responsibility and conscious wealth creation. We deliberately adopted exclusions that went beyond traditional market benchmarks because we believed investors should be able to grow wealth without compromising on their values," Lunawat stated, emphasizing the strong resonance between the index's framework and the fund's guiding philosophy.
Industry observers believe that a dedicated benchmark like the BSE Saatvik 100 Index will foster transparency and encourage further product development in India's ethical investment landscape, offering investors clearer options to align wealth creation with personal values and responsible practices.