(Credit: Pixabay)The Partnership for Carbon Accounting Financials (PCAF) launched its methodology enabling banks to measure and disclose the emissions associated with their financed activities.
More than 83 banks globally have joined PCAF, creating a global standard for measuring and disclosing financed emissions. As pressure has mounted on the financial sector to reduce its contribution to climate catastrophe, investors have focused on the need for banks to use a standardized approach to measure and transparently disclose their financed emissions as a critical step to reducing those emissions. As You Sow, and a range of investors, filed climate resolutions last year with five of the largest US banks and asked them to join PCAF and begin measuring and disclosing their financed emissions. Over the summer of 2020, major US banks Morgan Stanley, Bank of America, and Citigroup joined in committing to PCAF in advance of its launch.
As You Sow says banks are critical to ensuring that the economy is moving toward net zero emissions at the scale and pace necessary to avoid catastrophic impacts. Measuring and disclosing total financed emissions is the critical first step for banks to understand their climate impact, and for banks and investors to understand progress in reducing that impact.
In July, Energy + Environmental Leader reported that Morgan Stanley became the first US-based global bank to join the PCAF and its Steering Committee as part of the firm’s commitment to measuring and disclosing its approach to climate change risk and opportunity. PCAF includes financial institutions from around the world and represent more than $5.3 trillion in assets.
