Utrecht, Netherlands – 1 August 2024: The Partnership for Carbon Accounting Financials (PCAF) today celebrates the achievement of a major milestone as it reaches 500 signatories, reflecting the international financial sector’s growing momentum towards decarbonization.
The industry-led initiative experienced rapid growth following its global launch in September 2019. At that time, PCAF consisted of 55 signatories, largely made up of PCAF’s original founders and value-based banks. Responding to industry demand for a standardized GHG accounting and reporting approach, PCAF developed and published the Global GHG Accounting and Reporting Standard for the Financial Industry (“the Standard”) in 2020.
Since then, widespread adoption has made Part A of the Standard the most widely used methodology for measuring and reporting financed emissions globally. PCAF’s position in the global climate finance ecosystem was further solidified in October 2021, when the Task Force on Climate-related Financial Disclosures (TCFD) officially embedded the Standard into its financial sector recommendations.
Angélica Afanador, Executive Director of PCAF comments on the milestone, “The adoption of the PCAF Standard by financial institutions from right across the spectrum of the global industry demonstrates its relevance to the market. As investors and stakeholders demand greater transparency and accountability from financial institutions in terms of understanding the emissions associated with their financial activity, we are committed to championing further progress. I hope that this milestone serves as an inspiration to boost support to the global financial industry during this period of transition and to our 500+ signatories in their ongoing decarbonization journeys.”
In the years since its launch, banks and investors called for the expansion of the Standard to include additional methods. Answering this demand, PCAF expanded the Standard in November 2022 by publishing the second version of Part A and Part C, which addresses insurance-associated emissions. This progress continued in December 2023 with the release of Part B, dedicated to measuring and reporting the GHG emissions associated with capital market transactions.
The expansion of the Standard over the years reflects PCAF’s core objective of enabling financial institutions to accurately assess and subsequently manage their GHG emissions. This process encourages greater accountability, allowing for the integration of climate considerations into critical financial decision-making and ultimately raising transparency across the global financial sector.
Ivan Frishberg, Chief Sustainability Officer for Amalgamated Bank and PCAF President adds, “PCAF has reached 500 signatories through inclusive growth, ensuring that all types of financial institutions and regions are playing a role in growing a financial ecosystem for climate action. The breadth, diversity and depth of PCAF’s signatories reflects our mission to create a harmonized and consistent reporting standard for the financial sector. Reaching 500 signatories is not simply an enormous achievement for PCAF but reflects the momentum building across the global financial sector towards a more sustainable and lower carbon economy.”
Becoming a PCAF signatory provides financial institutions with access to technical assistance in the implementation of the Standard, a database of emissions factors to begin the accounting journey and training via the PCAF Academy, to name a few benefits. But in the broadest terms, it means proactively committing to enhancing transparency and consistency across the financial sector. It involves embedding new processes within an organization’s reporting cycle and shaping the alignment of financial flows with climate targets.
Looking ahead, PCAF is constantly exploring additional supporting services for signatories and continues to broaden the scope of the Standard. At present, working groups made up of PCAF signatories are leading the development of new methodologies across the following priority areas:
Drafts of the new methodologies will undergo a public consultation process in the latter part of 2024 and into the New Year. During this period, feedback can be provided to the Core Team to assist in finalizing the methodologies.
ENDS
About the Partnership for Carbon Accounting Financials
The Partnership for Carbon Accounting Financials (PCAF) was launched globally in September 2019. Currently, more than 500 financial institutions have subscribed to the PCAF initiative. PCAF signatories work together to jointly develop the Global GHG Accounting and Reporting Standard for the Financial Industry to measure and disclose the greenhouse gas emissions associated with portfolios of loans, investments, provision of insurance, and other financial products and services. By doing so, PCAF signatories take an important step to assess climate-related risks, set targets in line with the Paris Climate Agreement and develop effective strategies to decarbonize our society.
