Carbone 4 launches Carbon Impact Analytics, an innovative method for measuring the carbon impact of investment portfolios

For an investor or asset manager, measuring the impact of financed activities on climate change is a necessary step in building portfolios that contribute to the transition to a low-carbon economy.

Carbon Impact Analytics is an innovative methodology for measuring the carbon impact of an investment portfolio, specifically: • To measure the greenhouse gas emissions caused and avoided by companies in a portfolio, across their entire value chain (Scopes 1, 2, and 3). Carbon Impact Analytics also measures the emissions caused by and avoided through the products and services sold • To assess a portfolio’s contribution to the energy and climate transition Carbon Impact Analytics thus makes it possible to measure the greenhouse gas emissions associated with held assets and their contribution to reducing emissions—a regulatory requirement introduced by Article 173 of the Energy Transition for Green Growth Act. It is also a decision-support tool that enables investments to be redirected toward companies contributing to the energy and climate transition, particularly through the “green” portion of their business. The method provides asset managers with a detailed analysis of the carbon impact of companies in a portfolio and allows for the consolidation of results at the portfolio level. In this first version, the methodology covers the stocks and bonds of publicly traded companies worldwide. The analysis, conducted on a company-by-company basis, aims to foster an ongoing dialogue with companies over time. Carbon Impact Analytics was developed in collaboration with Mirova, Natixis’s subsidiary dedicated to responsible investment, and with the support of MAIF. The Carbon Impact Analytics methodology guide is available for download here.

The Methodological Principles of Carbon Impact Analytics A "bottom-up" analysis The analysis of a portfolio’s carbon impact begins with a detailed assessment of each security, followed by a weighted aggregation of the results at the portfolio level. Carbon Impact Analytics’ analysis thus distinguishes between companies within the same industry and recognizes efforts to integrate climate issues into their strategies, enabling the implementation of a “stock-picking” strategy based on carbon impact criteria. A sector-based approach with a detailed analysis for “high-stakes” sectors The challenges of the low-carbon transition vary by economic sector, both in terms of levers for reducing emissions and innovations. That is why Carbon Impact Analytics offers a specific approach for sectors facing significant challenges, with a methodology tailored to each sector. The quantitative assessment of emissions (both induced and avoided) is supplemented by a qualitative trend rating. Based on these factors, an overall score is assigned to each company to evaluate its contribution to the climate transition. A detailed presentation of the results of the Carbon Impact Analytics analysis, which can inform both reporting and investment strategy The results of the Carbon Impact Analytics assessment are provided on a consolidated basis at the portfolio level, as well as for each company. These results include several quantitative and qualitative indicators, as well as statistical representations at the portfolio level.

Press Contacts Carbone 4 Dorothée Coloby Tel: +33 (0)1 76 21 10 00 dorothee.coloby@carbone4.com

About Carbone 4 Founded by Alain Grandjean and Jean-Marc Jancovici, Carbone 4 is an independent consulting firm specializing in the energy transition, which offers its expertise to public and private sector organizations. Convinced that proactively addressing carbon constraints is the best possible approach, Carbone 4 works with its clients to help them transform these constraints into a powerful driver of innovation, a key competitive advantage, and a source of motivation for their teams. For the financial sector, Carbone 4 develops methodologies and tools tailored to each business line to enable them to measure and highlight the carbon impact of their financing activities and their contribution to the energy transition. www.carbone4.com