We played a key role in launching the UK coalition of the PCAF this week, an industry-led partnership to standardise carbon accounting in the financial sector. The PCAF provides a common methodological framework that investment managers, banks and asset owners can use to measure the level of emissions that they finance.
Until now, a lack of standardisation has limited how effective carbon accounting is. Addressing the level of carbon emissions that we finance as an industry requires detailed, transparent carbon accounting, as well as collaboration between public and private stakeholders.
This new framework will allow stakeholders to not only better understand the impact of their emissions, but also to work collaboratively in enacting genuine change. The UK coalition will apply the PCAF’s methodologies for measuring financed emissions, share best practice, work on improving data quality and carry out research on further method development.
The formation of a UK coalition comes after a collaborative structure was first created in the Netherlands, and its members include other major UK banks and asset managers. The working group will be observed by Mark Carney’s COP261 unit and will collaborate with both the government and the Bank of England to deliver examples of best practice.
The PCAF’s UK coalition will play a vital role in helping financial institutions work as a collective unit towards a common goal: assessing the level of carbon emissions in their portfolios and aligning their businesses with the goals of the Paris Agreement.
Our role at the helm of the UK coalition demonstrates our continued commitment to driving innovation in sustainable investment. Driven by our purpose to deliver sustainable wealth creation that enriches investors, benefits society and preserves the environment, we firmly believe in the importance of advocating for a financial system that works for all.
To find out more about how we have been at the forefront of sustainable investing and public-policy advocacy since our inception in 1983, read our Responsibility Report. Or to discover how our portfolio managers and engagers are adapting to the new climate normal, visit our climate hub.