Partnership for Carbon Accounting Financials (PCAF), SBR Nexus and Logius (i.e. the digital government service of the Netherlands Ministry of the Interior and Kingdom Relations (BZK)) are partnering to develop an improved model to streamline data required to assess the climate impact of loans and investments. With accurate data and disclosure, financial institutions can make better decisions to reduce the climate impact associated with their investments. This way, they can support the alignment of financial flows with the Paris climate targets.
The biggest climate impact banks, insurers, pension funds and other financial institutions have is through their customers. Institutions can invest in or provide loans to companies that in turn have considerable carbon emissions. At the same time, institutions can support carbon emission reductions by investing in renewable energy or other sustainable projects. This way, the financial sector has an important role in financing the energy transition.
Standardization of methods and data
By signing the Dutch Climate Agreement, the Dutch financial sector committed themselves to measure and disclose the climate impact of their loans and investments. Harmonized methods and standards across institutions nationally and abroad, are crucial. PCAF is an open standard of carbon accounting and is increasingly adopted by financial institutions globally.
To apply such a standard, up-to-date data on carbon emissions from households, companies and other institutions is key. To collect such data, PCAF, SBR Nexus and Logius will improve data definitions and dataflows, map access to data sources and stimulate the use of source data. They will determine the necessary data infrastructure and test a new data exchange concept based on standardized business reporting (like XBRL).
Tjeerd Krumpelman, chair of PCAF Netherlands: “This partnership develops a data exchange that is needed to measure and disclose our climate impact. This is in support of the Dutch Climate Commitment that fifty Dutch financial institutions provided in support of the Dutch Climate Agreement. “
Disclosing the carbon impact of investments is a great way to demonstrate the financial sector’s impact and take ownership. The universal data model in development will ensure quality and consistency and reduce time spent on analysis.
Working group data model and testing data exchange
The working group consists of representatives from:
- PCAF Netherlands Secretariat (staffed by Guidehouse)
- SBR Nexus
- ABN AMRO Bank
- ASN Bank
- Visma Connect
Logius is the digital government service of the Netherlands Ministry of the Interior and Kingdom Relations (BZK). It maintains government-wide ICT solutions and common standards, that simplify the communication between authorities, citizens and businesses, with a view to cohesion of the e-government networks. Logius supplies products relating to access, data exchange, standardization and information security.
About SBR Nexus
For banks, the availability of reliable and relevant data is decisive for its competitive position and social role in a digital society. ABN AMRO, ING and Rabobank own SBR Nexus with a mission to become the Netherlands' most used platform for the digital exchange of business data between companies and banks, or other organizations in the financial sector. SBR Nexus builds an open digital platform for the exchange of business data that integrates with the customer journeys of our customers.
In September 2019, the Partnership for Carbon Accounting Financials (PCAF) was launched globally. Currently, 80 banks and investors have subscribed to the PCAF initiative. PCAF institutions work together to jointly develop the Global Carbon Accounting Standard for the financial industry to measure and disclose the greenhouse emissions of their loans and investments (i.e. financed emissions). By doing so, PCAF institutions take the important step required to assess climate-related risks, set targets in line with Paris Climate Agreement and develop effective strategies to decarbonize their portfolios. For more information, see https://carbonaccountingfinancials.com/