Toward a reporting standard for financial services emissions

Some frameworks for managing financed emissions already exist. The Carbon Principles increase due diligence for financing decisions and facilitate dialogue on carbon performance related to investments in power companies. The Equator Principles provide a risk management framework for assessing environmental and social risks in project finance, such as major infrastructure and industrial projects. Most banks also have developed internal environmental, social and governance frameworks. And the GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard provides its own high-level framework for reporting value-chain emissions.

Yet, there is a lack of consensus around exactly how, when and why financial-services companies should measure and report financed emissions when considering very different company sizes, regulatory environments and competing priorities. To address this, the GHG Protocol is building on its original Scope 3 framework and hosting a series of workshops to potentially formulate reporting guidelines on financed emissions.

As managing Scope 3 financed emissions becomes more common, BSR will offer its members forums on how to understand the relevance of managing financed emissions and emerging expectations in the context of sustainability. As we do, we will collaborate with the GHG Protocol to share experiences among financial services sector companies, as we did on Monday at GHG Protocol’s workshop at JPMorgan Chase in New York.

This article first appeared in BSR’s Our Insights blog and is reprinted with permission. 

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