Alternative indices offer a simple and cost-effective mechanism for many trustees to more directly integrate ESG and climate considerations within their overall strategy design.  This might be, for example, from adopting an alternative index as a benchmark or investing in an alternative index tracking product. 

These indices typically tilt conventional market cap indices to take into account data on carbon emissions, fossil fuel reserves and other ESG metrics. This article looks at how alternative index offerings have developed, along with key challenges and considerations for investors in selecting a suitable approach.