Frankfurt, Germany, November 26, 2020 - The Partnership for Carbon Accounting Financials (PCAF), a global initiative of banks and investors to standardize the measurement and reporting of Greenhouse Gas (GHG) emissions, announced today a partnership with the Verein für Umweltmanagement und Nachhaltigkeit in Finanzinstituten e.V. (VfU). The VfU is the professional association of sustainability specialists in the financial sector in the DACH region, which has been the leading provider of a not-for-profit solution for calculating the operational carbon footprint of financial companies for 20 years.
The collaboration aims to support financial institutions in Germany, Austria and Switzerland to measure and disclose the financed emissions of their portfolios.
While the measurement of emissions from individual companies and projects is already largely standardized today, until recently it was not the case for GHG emissions at the portfolio level. GHG emissions at the portfolio level are usually determined using different approaches, if at all, which do not always produce comparable results.
With the Global GHG Accounting and Reporting Standard, PCAF now offers methods for the financial community to uniformly measure and report the greenhouse gas emissions financed through six asset classes. PCAF’s Global GHG Accounting and Reporting Standard provides methods for financial institutions to measure the emissions in their portfolio with a consistent and harmonized approach. The Standard was reviewed by the GHG Protocol and approved to be in conformance with the Corporate Value Chain (Scope 3) Accounting and Reporting Standard and marked with the official “Built on GHG Protocol” mark. The Standard also feeds into and aligns with the work of other climate initiatives, such as the financial sector disclosures of the Carbon Disclosure Project (CDP), Science Based Target initiative (SBTi) and the Task Force on Climate-related Financial Disclosures (TCFD).
While the PCAF standard is already beginning to establish itself internationally, it is still little known in German-speaking countries. Therefore, the new PCAF-VfU coalition is set to build the skills to implement the PCAF standard for the measurement of financed emissions in the DACH region. The partners will focus on the exchange of experiences among practitioners (so-called peer learning), further the development of GHG accounting methods and seek to improve data quality. The latter is particularly important for many financial institutions, because the required data is often not readily available. The work of the PCAF-VfU collaboration starts in January 2021. PCAF and VfU expect that the Standard will quickly experience an uptake by the financial sector in the DACH region.
With already 88 banks and investors from five continents, PCAF’s member financial institutions represent more than $18 trillion (USD) in assets. The initiative developed a consistent methodology for measuring GHG emissions of loans and investments made by firms in the financial sector. Originally created by Dutch banks and investors in 2015, PCAF was launched globally in 2019.
“The sentence 'you can’t manage what you haven’t measured' is often true. This applies in particular to the impact of companies on the environment. With PCAF, the international financial market now has a calculation standard to measure and report financed emissions in the most relevant asset classes. The cooperation between PCAF and VfU provides financial companies in the DACH region with a place to acquire the necessary skills for the application of the new Global GHG Accounting and Reporting Standard in order to contribute to the goal of reducing greenhouse gas emissions by the year 2050.”
Henrik Ohlsen, Managing Director of VfU
“We are very excited about the collaboration with VfU. PCAF and VfU have a lot in common, we both have large networks of sustainable finance experts and have the aim to enable them to decarbonize their portfolios. By teaming up, we can support financial institutions in Germany, Austria and Switzerland to measure the financed emissions of their loans and investments more effectively”
Giel Linthorst, Executive Director of the PCAF Secretariat and Director at Guidehouse
The Partnership for Carbon Accounting Financials (PCAF), launched in 2019, currently consists of 88 banks and investors that have subscribed to the PCAF initiative. PCAF participants work together to jointly develop a global Standard for the financial industry to measure and disclose the greenhouse emissions of their loans and investments. By doing so, PCAF participants take the first step required to assess climate-related risks, set targets in line with the Paris Climate Agreement and develop effective strategies to decarbonize our society. For more information, visit: https://carbonaccountingfinancials.com/
The VfU is a network of Sustainable Finance Professionals, founded in 1995, currently consisting of 49 financial companies including banks, insurance companies, investment companies and corresponding associations.
VfU focuses on the promotion and dissemination of "Sustainable Finance", understood as a "comprehensive approach to the management of the economic, social and environmental dimensions of finance to enable broad-based progress to sustainable development” (UNEP, 2017), in accordance with the definition of the UN Environment Program (UNEP).
To this end, the VfU offers financial service providers a platform on which they can acquire, exchange, generate and deepen knowledge and know-how in various formats of sustainable finance. For more information, visit: https://vfu.de/ .
Reporters May Contact:
Henrik Ohlsen, VfU
Giel Linthorst, Executive Director, PCAF Secretariat