1. For direct investments (loans and underwritings) include:
- The total loan portfolio of the company
- Yearly investments in fossil fuels
- Yearly investments in renewable energy
Please note that we require investments in renewable energy exclusively. Green investments and green bonds include renewable energy investments but are not solely renewable energy investments. In the note, make sure to specify the amount the company provided to renewables specifically.
- The percentage of the company’s loan portfolio invested in
- Include an analysis of the impact the company’s financed emissions are having. Which projects is the company funding?
- Consider the Thresholds and Exceptions section above
2. For indirect investments (shareholding, bondholding) include:
- The company’s Assets Under Management
- Amount the company held in fossil fuels
- Amount the company held in renewables
CAUTION: If a financial institution has over 5% ownership in either an oil and gas production company or a renewable energy company, please make sure to mention this in the note.
- The percentage of the company’s AUMs invested in
Compare the two percentages with the industry average (refer to the internal excel file with the global percentages invested per type of energy source here. Please cite these two sources (1 & 2) when using the information from the spreadsheet).
Is the company over-investing in renewables or fossil fuels compared to the market?
Things to bear in mind:
If the company is a commercial bank, we would need to have information on direct investments (loans and underwriting). Please note that the company might have a big enough asset management arm. In this case, we would also need information on their indirect investments as a secondary point. (Key example)
Also, ask yourselves the following questions:
1/ The breadth of the impact
Is the impact local, national, or global?
How much CO2 is released or avoided?
2/ The depth of the impact
Is the environment deeply affected, or does the issue just marginally impact it?
Are the changes brought by the issue profoundly changing society or the planet?
3/ The persistence of the impact
Find more about evaluating the scale of the impact in Step 5: Assess scale and value.