There’s ever-growing pressure – from governments, civil society and from the investment community – for companies and the investors that hold stakes in them to measure and reduce their carbon footprint. A portfolio’s carbon footprint is the sum of a proportional amount of each portfolio company’s emissions (proportional to the amount of stock held in the portfolio). A carbon footprint is a useful quantitative tool that can inform the creation and implementation of a broader climate change strategy.
What are the benefits?
Investors who have measured the carbon footprint of portfolios say that doing so can: improve their understanding of the portfolio risks and opportunities that climate change presents; give them answers to stakeholder questions on climate change; allow them to publicly demonstrate commitment to tackling climate change.
By signing the Montréal Carbon Pledge, investors commit to measure and publicly disclose the carbon footprint of their investment portfolios on an annual basis.
What is expected of investors that make this commitment?
To meet the requirements of the Montréal Carbon Pledge, you must annually measure the carbon footprint of an equities portfolio, or portion thereof. The Montréal Carbon Pledge also considers a carbon footprint of other asset classes, including private equity. Disclosure must be through your website, annual report, sustainability report, responsible investment report or other publicly visible client/beneficiary reporting channel.
Start the journey
The pledge is open to all asset owners and investment managers – you do not need to be a PRI signatory. The commitments these investors make will allow the investment community to compare an increasing amount of portfolios to global benchmarks, identify priority areas and actions for reducing emissions and track progress in making those reductions.
The Montréal Carbon Pledge website
The Montréal Carbon Pledge is supported by:
Principles for Responsible Investment (PRI)
United Nations Environment Programme Finance Initiative (UNEP FI)
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