The Partnership for Carbon Accounting Financials (PCAF) announced today that Norges Bank Investment Management (NBIM), the investment manager for Norway’s $1.3 trillion oil fund has joined the initiative, which includes a commitment to assess and disclose greenhouse gas emissions associated with investment portfolio through the PCAF reporting standard.

NBIM was established to manage revenues from Norway’s oil and gas resources. The fund has grown to one of the world’s largest, owning approximately 1.5% of all shares in the world’s listed companies, with holdings in over 9,000 companies in 70 countries.

The PCAF is a global partnership of financial institutions, launched in 2019 with a mission to develop and implement a harmonized approach to assess and disclose the greenhouse gas (GHG) emissions associated with loans and investments. The organization has experienced rapid growth since launch, and now includes over 400 financial institutions representing more than $92 trillion in financial assets.

In November 2020, the PCAF launched the Global GHG Accounting and Reporting Standard for the Financial Industry, with the second version released in December 2022, designed to provide a standardized, robust and clear way for banks, asset managers, and asset owners to measure and report the GHG emissions impact of their loans and investment portfolios. The standard has become the single most widely used methodology for measuring and reporting financed emissions globally, and was embedded into the Task Force on Climate-related Financial Disclosures’ (TCFD) climate disclosure recommendations for financial services.

The announcement follows the launch last year by NBIM of its climate action plan for managing climate risks and opportunities, and a target to reach net zero emissions for all companies in the fund by 2050. The plan includes a commitment to push companies to align their activities with net zero emissions targets, and to expand portfolio-level climate risk reporting.

NBIM has already begun reporting emissions utilizing the PCAF standard, starting with its 2022 TCFD Report, in which it revealed that financed emissions for its equity and corporate bond portfolios in 2022 were 51.7 million tonnes CO2-equivalent.

Christopher Wright, Head of ESG Risk Monitoring at NBIM said:

“We are delighted to be part of this industry-led initiative. As financial institutions around the world continue to build an understanding of and report on their climate risk and opportunities, the standardization of climate risk accounting methodologies will prove invaluable. We look forward to collaborating with PCAF to further develop standards in this area over the coming years.”