Portfolio Carbon Initiative

Guidance for financial institutions to properly assess climate performance from investing and lending activities

The world is already transitioning to a low-carbon economy. Financial institutions have the power to expedite and smooth the transition by limiting their contribution to the climate problem and growing their contribution to the climate solution. The Portfolio Carbon Initiative, a partnership with 2 degrees Investing Initiative (2DII) and UNEP Finance Initiative (UNEP FI),  develops a series of resources to guide financial institutions in assessing the climate [un]friendliness of their activities and carbon asset risk.

This initiative was previously called the Financed Emissions Initiative.

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Portfolio Carbon Initiative Goals and Work Streams

While the GHG Protocol Corporate Standard and the Corporate Value Chain (Scope 3) Standard clarify how companies should account for the greenhouse gas emissions that result from their products and services, more guidance is needed for financial institutions if they are to properly assess climate performance from investing and lending activities.

The Portfolio Carbon Initiative has two goals:

  • Provide guidance on how to define, assess, and track climate performance for asset owners and banks
  • Provide guidance on how to identify, assess, and manage “carbon asset risks” for financial institutions

The complexity of the financial sector requires that the Portfolio Carbon Initiative operate via three work streams.

  • Work stream 1: Asset owner climate performance 
    This work stream is tailored to asset owners. It will produce two documents: a comparative analysis of current climate performance metrics, followed by climate performance accounting guidance for asset owners. 
  • Work stream 2: Bank climate performance 
    This work stream is tailored to banks. It will produce a comparative analysis of current climate performance metrics for banks.
  • Work stream 3: Carbon asset risk 
    This work stream will produce guidance that explains why and when GHG emissions associated with carbon-intensive assets lead to financial risks, as well as how those risks can be assessed and mitigated.

Supporting Documents

Background Information
Scoping Documents

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