PCAF and CDP Align Data Quality Systems to Streamline Financed Emissions Reporting

The Partnership for Carbon Accounting Financials and CDP have co-authored a joint paper on data quality in financed emissions measurement, part of an initiative to align their respective scoring systems. The collaboration, active since December 2021, aims to simplify how financial institutions measure and disclose the greenhouse gas emissions associated with their loans and investments.

The paper addresses a persistent challenge in financial sector emissions reporting: a lack of standardisation in data quality scoring that creates inconsistency and makes cross-institution benchmarking difficult. PCAF and CDP argue that using approximate data as a starting point is preferable to inaction while waiting for perfect data, since quality improves iteratively over time. The alignment of their two scoring frameworks is intended to reduce duplication for the more than 380 banks and investors already subscribed to the PCAF initiative and the over 740 financial institutions working with CDP.

Accurate financed emissions disclosure is increasingly material for financial institutions seeking to set Paris Agreement-aligned targets and manage climate-related portfolio risk. CDP's dataset, which underpins portfolio analysis for institutions holding over US$130 trillion in assets, provides the real-economy company data that financial institutions need to calculate their financed emissions under the PCAF Global GHG Accounting Standard. Harmonising data quality indicators between the two frameworks reduces the reporting burden and improves comparability across institutions and geographies.

The alignment of PCAF and CDP data quality systems represents a step toward a more standardised global approach to financed emissions accounting. Financial institutions are encouraged to use the available data — even where incomplete — to begin or improve their disclosures, with quality expected to increase as engagement with the frameworks deepens. PCAF Executive Director Angelica Afanador stressed that accurate target-setting is contingent on data quality improvement, while CDP's Chief Impact Officer Nicolette Bartlett called portfolio emissions mapping a vital issue for curbing absolute emissions.

Key figure — 380+ banks and investors subscribed to the PCAF initiative