Index Rules
FTSE Policy Group
The FTSE Policy Group, whose membership is representative of users of the FTSE Indices, is established by FTSE as an independent committee. The FTSE Policy Group is responsible for determining major policy issues and monitoring the activities of the FTSE Equity Indices Committee.
FTSE Equity Indices Committee
The FTSE Equity Indices Committee is responsible for overseeing and maintaining the Ground Rules for the Management of FTSE equity indices.
The Committee ensures that a consistent approach is applied to the selection of constituents and the application of corporate events by the FTSE Regional Committees.
The Committee may establish sub-committees to undertake any of these duties or to consider particular issues in depth.
The Committee meets quarterly or more frequently, as required.
FTSE Regional Committees
The FTSE Equity Indices Committee has established three Regional Committees:
- Americas
- Europe / Middle East / Africa
- Asia / Pacific
The purpose of the Regional Committees is to undertake the reviews of FTSE equity indices and ensure that constituent changes and index calculations are made in accordance with the Ground Rules.
FTSE Global Classification Committee
The FTSE Global Classification Committee is responsible for the industry classification of constituents of the FTSE Indices within the FTSE Global Classification System.
Committee Membership
FTSE appoints a Chairman and Deputy Chairman of the FTSE Policy Group. The FTSE Policy Group appoints the Chairman to the FTSE Equity Indices Committee. The Chairman of this committee must be selected from the membership of the FTSE Policy Group. The relevant Chairman, or in his absence Deputy Chairman, will chair meetings of the respective committee and will represent that committee outside meetings.
The Chairman and Deputy Chairman of the FTSE Regional Committees are selected from the membership of the FTSE Equity Indices Committee and are collectively responsible for approving constituent changes to FTSE equity indices.
Secretary To The FTSE Policy Group And FTSE Equity And Regional Indices Committees
A Secretary to the FTSE Policy Group, FTSE Equity Indices Committee and FTSE Regional Committees will be appointed by FTSE to support the work of these bodies. The Secretary will maintain a record of constituent changes to the FTSE Iindices and will be responsible for the timely publication of all constituent changes.
The Secretary will be responsible for conducting the periodic review of the FTSE Indices and will recommend for the approval of the FTSE Regional Committees which companies, if any, should be inserted and deleted at the periodic review.
The Chairman or Deputy Chairman (or their deputies) may request that a full meeting of the Committee be convened to consider a proposed change of constituent should any one of them consider it appropriate to do so.
The Secretary will inform the FTSE Regional Committees of all constituent changes as soon as possible after the change has been approved and he/she will be responsible for the timely publication of changes of constituents.
FTSE
FTSE is responsible for the operation of all the FTSE Indices. FTSE will maintain records of the market capitalisation of all constituents and reserve companies and will make changes to the constituents and their weightings in accordance with the Ground Rules. FTSE will carry out reviews and implement the resulting constituent changes as required by the index rules.
Changes to constituent weightings will be made by FTSE in accordance with the Ground Rules. FTSE will inform the Secretary to the Regional Indices Committee of all changes to constituent weightings as soon as possible after the new weightings have been determined. FTSE is responsible for publicising and keeping a record of all changes to constituent weightings.
Amendments to the Index Rules
Changes and exceptions to these Ground Rules can be authorised only by the FTSE Equity Indices Committee. In the event that the FTSE Regional Committees or any of those responsible for the operation and administration of the FTSE Indices consider that an exception should be made to any of the Ground Rules, the issue must be brought to the attention of the Chairman or Deputy Chairman (or their deputies) of the FTSE Equity Indices Committee.
If, however, the matter is urgent, the Chairman and Deputy Chairman (or their deputies) are collectively empowered to authorise an exception on behalf of the FTSE Equity Indices Committee but must immediately notify, and subsequently refer the matter to, a meeting of the FTSE Equity Indices Committee.
Where an exception is granted to the Ground Rules it shall not be deemed to create a precedent for future decisions of the FTSE Equity Indices Committee or the FTSE Regional Committee.
Appeals Against Decisions of the Committees
A constituent or prospective constituent company (or advisor acting on behalf of the company) may appeal against the decisions of the FTSE Equity Indices Committee or FTSE Regional Committees on two grounds:
- that the relevant Committee acted outside of the index rules for the Management of the FTSE Indices; or
- that the relevant Committee when reaching its decision failed to take into consideration a substantial and material fact. A substantial and material fact is defined as a fact which would have influenced the decision of the Committee if it had been considered