Equifax UK has teamed up with Scottish fintech, CienDos, to launch a Financed Emissions Calculator.
Described as a game-changing sustainability solution, it’s been designed so that financial institutions can track their carbon footprint more precisely.
“The role of financial institutions in helping to combat climate change is gaining significant attention, but indirect financed emissions associated with loans and other credit lines are among the most complex to track,” explained Equifax UK’s ESG Product Manager, Brad Davies.
“By integrating environmental data with leading financial risk assessments, the Financed Emissions Calculator™ empowers UK lenders to measure and mitigate their climate impact. We’re excited to partner with CienDos to fill the knowledge gaps for clients with this first-to-market solution.”
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It uses Equifax’s fully cloud-native infrastructure, in order to help streamline sustainability reporting requirements and provide “more accurate and timely data delivery.”
That, the companies believe will enable lenders to make more informed decisions to align net-zero targets with lending and investment strategies.
“Equifax and CienDos have a shared vision to simplify the complex reporting requirements around financial firms’ carbon footprints,” said CienDos Chief Executive Julia Salmond.
“As a critical player at the heart of the UK financial ecosystem, Equifax’s extensive commercial credit data successfully combines with our own market-leading emissions data technology to help transform the management of portfolio emissions for firms, delivering greater accuracy and precision for their financed emissions reporting needs.”
Salmond added that they hope the solution will totally transform the “manual, time-consuming and error-prone processes of calculating financed emissions” into an automated system designed to support regulatory-compliance.
Financed emissions are the greenhouse gas emissions indirectly attributed to financial institutions via their lending and investment activities.
These emissions are generated by the activities of companies or projects that banks, asset managers, insurers and others fund, but not by the financial institutions themselves.
The lending and investing portfolio of a financial institution typically accounts for up to 95% of their total carbon emissions.
With increasing pressure to disclose climate data, many banks are currently managing financed emissions using traditional methods such as manual calculations using high-level estimations, which is where the Financed Emissions Calculator hopes to come in.
