180+ Financial institutions - $ 56 + Trillion in total assets

PCAF collaborates with the Joint Impact Model to improve financed emissions estimates in developing countries

PCAF collaborates with the Joint Impact Model to improve financed emissions estimates in developing countries

The Joint Impact Model can be used to fill the gap in GHG emissions data for corporate lending portfolios in developing countries when real data is lacking or incomplete.

Utrecht/The Hague - November 3, 2021 – The Partnership for Carbon Accounting Financials (PCAF), together with the Joint Impact Model (JIM), today announced a collaboration to make the JIM available to PCAF participating banks in developing countries.

The JIM is a publicly accessible tool which enables the quantification of indirect jobs, value added and GHG emissions (scope 1, 2 and 3) related to corporate lending portfolios. Together, PCAF and JIM will align the current JIM methodology with the PCAF Global GHG Accounting and Reporting Standard for the Financial Industry so any banks in developing countries will be able to report on their financed emissions aligned with the PCAF Standard. This also means all current users of the JIM will be able to align their reporting with the PCAF Standard. The JIM sources their data from GTAP, which contains a wider dataset for developing countries, allowing these banks to improve their calculations of financed emissions in corporate lending portfolios. It will be tested by three banks in Q1 2022 before it is rolled out to other PCAF signatories in developing emerging markets.

“We’re pleased to see PCAF signatories FMO and CDC leading the development of JIM. We look forward to testing and refining the JIM tool so that it can be used by PCAF signatories investing in developing countries.”

Giel Linthorst, Executive Director, PCAF

PCAF recognizes that the data required to calculate a borrower’s or investee’s emissions are often unavailable and recommends financial institutions to use the best available data. Currently, PCAF’s emission factor database allows PCAF signatories to estimate financed emissions based on regional and sectoral averages from publicly available sources, but its coverage in developing countries is sparse. The collaboration with JIM will enable banks in developing countries to more accurately estimate GHG emissions based on their country, economic activity, and some additional data such as outstanding amounts and revenues of corporate clients. Where banks in developing countries do not have real data or complete data available, they can use the JIM to make initial estimates of their emissions.

“The PCAF-JIM partnership aligns two parties which are trying to achieve the same thing: holding the financial sector accountable by providing a transparent, and comparable way to do emissions accounting. While PCAF provides the methodology for GHG accounting, JIM is the easy-to-use tool applying the methodology. I am confident that this combination will be a catalyst to scale our vision.” 

Dietske Simons, Director a.i. of Finance, Impact, and Data, FMO and co-chair of the JIM Governing Board

**For more information, please contact:

PCAF

Giel Linthorst
Executive Director, PCAF
info@carbonaccountingfinancials.com

Angélica Afanador
Program Manager & Latin America Team Lead, PCAF
info@carbonaccountingfinancials.com

JIM

Alex MacGillivray
Evaluations Director, CDC
Co-Chair of the JIM Governing Board, JIM
contact@jointimpactmodel.org

Giulia Debernardini
Impact Officer, FMO
Business Manager, JIM
contact@jointimpactmodel.org
 

About the Partnership for Carbon Accounting Financials

The Partnership for Carbon Accounting Financials (PCAF) was launched globally in September 2019. Currently, more than 170 banks and investors have subscribed to the PCAF initiative. PCAF participants work together to jointly develop the Global GHG Accounting and Reporting Standard for the Financial Industry to measure and disclose the greenhouse gas emissions of their loans and investments. By doing so, PCAF participants 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.

Learn more at: https://carbonaccountingfinancials.com

About the Joint Impact Model

The JIM is a publicly accessible tool, which enables the reporting and assessment of systemic impact indicators such as jobs, value added, and greenhouse gas (GHG) emissions related to investments of financial institutions. The aim of the initiative is to bring comparability, accountability, transparency and thought leadership to the financial industry by measuring key impact indicators in a harmonized way. Joint Impact Model is developed in collaboration with Steward Redqueen a specialist consultancy firm. More than 70 IFIs (MDB’s, DFI’s, PE funds, Financial institutions and other impact investors investing in developing countries) have access to the JIM, of which 14 IFIs have already reported using the JIM on jobs or emissions.

Learn more at www.jointimpactmodel.org