In line with its commitment to the Montreal Pledge – a UN-supported initiative to help make investors aware of carbon risk – BNP Paribas Asset Management measures and publishes the carbon footprint of its investment portfolios.
Carbon footprint reports provide insights into the carbon impact of funds. It shows the quantity of greenhouse gases (GHGs) connected to the investments chosen. The footprint is measured in kilogrammes of CO2 equivalent (CO2e) per EUR 100 invested.
BNPP AM focuses on two categories in the GHG Protocol:1
- SCOPE 1: direct emissions from company facilities
- SCOPE 2: indirect emissions from the company’s energy consumption.
Our calculation involves scope 1 & 2 emissions weighted for these factors:
- The company’s enterprise value (i.e., the sum of its debt and market capitalisation)
- The company’s weighting in the portfolio or the benchmark index.
The carbon intensity of each portfolio holding is added up to produce the carbon footprint of the portfolio. We also calculate the carbon footprint of the portfolio’s benchmark to compare that to the footprint of the portfolio.
Our approach allows us to measure the carbon footprint of equity funds and funds invested in corporate bonds.
1 GHG Protocol: an international standard measuring greenhouse gases. Source: Copyright © 2019 S&P Trucost Limited (“Trucost”), an affiliate of S&P Global. All rights in the Trucost data and reports vest in Trucost and/or its licensors. Neither Trucost, nor its affiliates, nor its licensors accept any liability for any errors, omissions or interruptions in the Trucost data and/or reports. No further distribution of the Data and/or Reports is permitted without Trucost’s express written consent. Investments in funds are subject to market fluctuations and the risks that are inherent in investing in financial securities. The value of investments and the revenues they generate are subject to both highs and lows and it is possible that investors may not recover their entire investment. The funds described pose a risk of loss of capital. For a definition and fuller description of the risks, please refer to the fund’s prospectus and KIID. All information referred to in the present document is available on www.bnpparibas-am.com