Scope 3.15 - Investments
Why Scope 3.15 "Investments" Matters
Finance shapes the future. Whether you’re a bank, investor, asset manager, or an organization holding stakes in other companies, your investment and lending activities extend your climate influence far beyond your operations.
Scope 3.15 captures the greenhouse gas (GHG) emissions associated with the companies, projects, or assets in which you invest, finance, or lend capital.
By including investment emissions, you lead with integrity and compassion—acknowledging how financial flows can enable (or impede) positive change. Transparent investment accounting is a foundational act of collaboration with clients, portfolio companies, and partners, and a driver of quality in reporting and strategy. In this way, you not only act sustainably in your own operations, but use your investments as a force for good across the wider economy.
What’s Included in Scope 3.15?
Scope 3.15 covers emissions from investments, lending, and similar financial activities if you are a financial institution (or a non-financial corporation with significant investment holdings). These emissions are calculated as your organization’s share of the GHG emissions generated by the entities or assets in which you have invested.
Examples of relevant activities:
- Loans to companies, project finance, mortgages, and revolving credit.
- Equity investments in subsidiaries, associates, portfolio companies, or infrastructure projects.
- Debt and bond holdings, if they fund company/project activity.
- Insurance underwriting portfolios (may also be relevant depending on reporting standards).
Not included:
- Treasury cash or sovereign debt.
- Emissions from your own operations, leased assets, or supply chain (see other Scope 1, 2, and 3 categories).
Note: The Greenhouse Gas Protocol and “Partnership for Carbon Accounting Financials (PCAF)” offer detailed methodologies for different asset classes.
What Data Do You Need?
While data quality and availability can vary, your journey toward robust reporting and sustainable finance starts with a clear process:
1. Investee-/Borrower-Specific Emissions Data (Highest Quality)
- Direct GHG emissions data (Scope 1 and 2; optionally Scope 3) reported by investees.
- Financial data to determine your “share” of emissions (e.g., outstanding loan amount/enterprise value, equity share percentage).
- Engagement with investee companies for improved disclosure.
2. Modeled or Estimated Emissions (Medium Quality)
- Apply sector-specific emissions factors based on revenue, assets, or business activity from recognized databases.
- Use PCAF or similar methodologies to estimate emissions for each relevant asset class.
3. Proxy or Portfolio-Level Averages (Basic Quality)
- If portfolio companies do not disclose emissions, use sector- or geography-level GHG intensity models.
- Estimate financed emissions using default metrics (e.g., tCO₂e per $ invested).
Always: Transparently note sources, allocation methods, and improvement strategies.
What Should You Watch Out For?
- Boundary clarity: Ensure you are accounting for only those investments relevant to Scope 3.15 as described above.
- Attribution: Use appropriate allocation keys per asset class (e.g., proportional ownership, share of outstanding loan, etc.).
- Double counting: Be clear not to duplicate emissions accounted for elsewhere in your organization’s reporting.
- Data gaps: If data from investees is missing or incomplete, use robust proxies and engage companies toward improved annual disclosure—it’s about consistent, just progress.
- Stakeholder dialogue: Approach portfolio companies as partners; share the rationale and seek mutual learning.
Example of Data Needed
| Investment Class | Emissions Data | Allocation Approach | Source/Method |
|---|---|---|---|
| Corporate loans | Borrower’s Scope 1/2 GHG | Loan amount/total debt or enterprise value | Direct borrower data, PCAF, proxy averages |
| Listed equity | Portfolio company GHG | % ownership of shares | Company reports, databases, PCAF |
| Project finance | Project emissions | % of total funding provided | Project operator reports, LCA, PCAF |
| Real estate funds | Energy use, emissions | % of fund assets | Fund manager, sample portfolios |
Summing Up: Checklist for Scope 3.15
- Inventory all relevant investment, lending, and financing activities.
- Collect or robustly estimate financed emissions for each asset/class.
- Allocate your share transparently using the best available financial and GHG data.
- Document methodologies, data sources, and gaps; plan annual improvements and engagement.
- Report with clarity—show progress and ambition, not just numbers.
Leading Climate Change Through Capital
By including investment emissions in your climate reporting, you harness the full power of your capital for positive transformation. Your care, integrity, and vision shape not only your own portfolio, but also empower businesses worldwide to build a more sustainable future.