Announcement for December 05, 2025 at 11:13 PM GMT

THIS IS AN ANNOUNCEMENT FOR THE MSCI GLOBAL STANDARD INDEXES

CONCLUSIONS FROM THE CONSULTATION ON POTENTIAL ENHANCEMENTS TO THE MSCI SCREENED INDEXES METHODOLOGY

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MSCI announced today conclusions from its recent consultation with the investment community on potential enhancements to the MSCI Screened Indexes methodology.

Proposal 1: Update the screening criteria

During the consultation, most market participants were in favor of the proposed relaxation of the nuclear weapons screen. In addition, investors expressed a preference to go beyond the proposal and to screen only companies that are directly involved in creating nuclear weapons. Therefore, based on the balance of feedback, the nuclear weapons screen will be adjusted to exclude only companies that:
- Manufacture nuclear warheads or missiles
- Manufacture components for exclusive use in warheads and missiles

Respondents have generally expressed concerns about removing the aggregate revenue-based tobacco and civilian firearms screens, as respondents indicated their internal responsible investment policies still reference these screens, hence MSCI will make no changes to these two screens.

Despite some positive feedback, MSCI will make no changes to the biodiversity-related controversies screen as a number of market participants expressed concerns on the potential eligibility of companies with controversies related to certain activities, such as deforestation. MSCI acknowledges interest from certain investors to differentiate between activity types and will monitor potential future availability of data that may allow for a more granular screening.

Finally, most market participants expressed their preference for enhancing the transparency of the methodology rather than adding explicit screens on compliance with international standards for labor rights and human rights. Therefore, MSCI will not add explicit screens for labor and human rights but will instead provide additional disclosure in the MSCI Screened Indexes methodology book confirming that the existing screen on Red Flag controversies addresses relevant international standards in these areas.

Proposal 2: Enhance the GHG Intensity Reduction process

A majority of respondents were supportive of enhancing the GHG Intensity Reduction process to mitigate reverse index turnover, but some highlighted the importance of not increasing the complexity of the methodology. Therefore, MSCI will introduce a 12-month waiting period before a company excluded due to the GHG Intensity Reduction process can be eligible again ("Condition 1" from the consultation proposal). However, MSCI will not prevent a company to be added back if it has very high GHG intensity ("Condition 2" from the consultation proposal).

All changes described above will be implemented as part of the February 2026 Index Review.

MSCI also acknowledges the valuable feedback received on the various discussion points and will carefully consider such feedback for potential future consultations.

MSCI will send a separate communication to relevant clients in due course regarding the potential implementation of these changes in custom indexes. At this stage, the expected timeline for implementing these changes in custom indexes is the February 2026 Index Review.

MSCI will make available the updated MSCI Screened Indexes methodology book prior to the implementation of the enhancements mentioned above. MSCI will also provide simulated impact of the changes in due course.

THIS IS AN ANNOUNCEMENT FOR THE MSCI GLOBAL STANDARD INDEXES

                                     End of announcement.
                                     Further announcements may occur as needed.