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Audit-Ready Carbon Reporting for Asset Managers

Track financed emissions across equity, bonds, and alternative investments. Calculate portfolio carbon intensity per $M AUM using PCAF methodology.

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The Industry Hotspot: Investment Portfolio Financed Emissions

95-99% from portfolio holdings

For asset managers, 95-99% of carbon footprint is financed emissions from portfolio holdings (Scope 3 Category 15). A $10B equity fund invested in S&P 500 companies generates ~500,000 tCO2e financed emissions annually (50 tCO2e per $M AUM). Listed equity has highest data quality (PCAF Score 2). Corporate bonds require borrower-specific attribution. NetNada automates PCAF calculations, tracks portfolio decarbonization vs benchmarks, and generates NZAM/NZAOA-compliant disclosures.

SASB Industry Definition

The Asset Management & Custody Activities industry consists of entities that provide investment management services, including investment advisors, mutual fund companies, exchange-traded fund (ETF) sponsors, and entities that provide custody and related services. These entities manage capital on behalf of institutional and retail clients and earn revenue primarily through fees based on Assets Under Management (AUM). The industry's operations include portfolio management, investment research, trading, and custody services.

View SASB Standard →

Industry-Specific Carbon Accounting

No generic solutions. Metrics, data sources, and reporting aligned to Asset Management & Custody Activities operations.

Automated PCAF Portfolio Calculations

Import holdings data (ISIN, shares, market value). Match to company emissions databases (CDP, Bloomberg, Trucost). Calculate attribution factor: Portfolio weight ÷ Company EVIC (enterprise value + cash). Financed emissions = Attribution × Company Scope 1+2+3.

PCAF Score 2-3 for listed equity

Portfolio Carbon Intensity Benchmarking

Calculate weighted average carbon intensity (WACI): Σ(Portfolio weight × Company carbon intensity). Benchmark vs MSCI ACWI (150 tCO2e/$M revenue), S&P 500 (130 tCO2e/$M), sector indices. Track quarterly decarbonization trajectory.

tCO2e per $M AUM tracked

Data Quality Score Tracking

Report % of AUM with PCAF Score 1-2 (reported emissions) vs Score 3-5 (estimated emissions). Prioritize engagement with portfolio companies lacking emissions disclosure to improve data quality.

Data quality by asset class

Net-Zero Asset Manager Reporting

Auto-generate NZAM commitment disclosures: % of AUM in net-zero aligned portfolios, interim 2030 targets, portfolio coverage by sector. Track decarbonization vs 1.5°C pathway (Science Based Targets initiative).

NZAM/NZAOA compliant

Sovereign Debt Emissions Attribution

For government bonds, use country-level emissions data: Financed emissions = (Market value of bond ÷ Country GDP) × Country total GHG emissions. PCAF Score 3-4 for sovereign debt.

Sovereign emissions tracked

SFDR Article 8/9 Fund Compliance

Track Principal Adverse Impact (PAI) indicators for sustainable funds: GHG intensity, fossil fuel exposure, biodiversity impact. Generate SFDR periodic reports with portfolio carbon footprint.

SFDR PAI automated

Product Features for Asset Management & Custody Activities

Use Carbon Data Uploader to import holdings files (CSV, Excel) with ISIN codes, match to emissions databases, and calculate portfolio-level financed emissions automatically. Learn more →

The Activity Calculator applies PCAF attribution methodology across asset classes—equity, bonds, real estate, project finance—ensuring consistent financed emissions calculation. Learn more →

Related Solutions

See our Carbon Accounting solution for end-to-end financed emissions tracking from data ingestion through NZAM disclosure generation.

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Asset Management & Custody Activities Case Studies

How entities in this industry use NetNada to solve carbon accounting challenges.

Australian Equity Fund Manager (A$25B AUM, 80 holdings)

Challenge

AASB S2 required financed emissions disclosure with PCAF methodology. Manual calculations from Bloomberg data took 40 hours per quarter with inconsistent attribution factors.

Solution

Deployed NetNada with automated ISIN matching to CDP and company-reported emissions. Set up quarterly portfolio upload via SFTP. Configured PCAF asset class rules and attribution calculations.

Result

Reduced quarterly reporting time from 40 hours to 2 hours. Achieved PCAF Score 2 for 85% of AUM (listed equity with reported emissions). Published portfolio carbon intensity 35% below MSCI Australia benchmark.

ESG Multi-Asset Fund (Article 9 SFDR, €8B AUM)

Challenge

SFDR required Principal Adverse Impact disclosure including portfolio carbon footprint. Mixed asset classes (equity 60%, bonds 30%, real estate 10%) each needed different PCAF methods.

Solution

Used NetNada multi-asset class engine: Listed equity via EVIC attribution, corporate bonds via outstanding amount, real estate via property-level energy data. Configured SFDR PAI indicator calculations.

Result

Completed first SFDR periodic report 6 weeks ahead of deadline. Portfolio WACI 45 tCO2e/$M revenue vs 150 for MSCI ACWI. Demonstrated 70% lower carbon intensity vs benchmark for investor marketing.

SASB Disclosure Topics for Asset Management & Custody Activities

Material sustainability topics beyond emissions that investors and stakeholders expect disclosed per SASB standards.

Financed Emissions

environment

Calculate Scope 3 Category 15 emissions from equity, bonds, and alternative investments using PCAF methodology. Report tCO2e per $M AUM and portfolio carbon intensity vs benchmarks.

ESG Integration in Investment Process

governance

Disclose how environmental, social, and governance factors are integrated into investment analysis, portfolio construction, and stewardship activities.

Climate Risk Integration

business model

Report how climate-related risks (physical and transition) are assessed in portfolio construction. Disclose climate scenario analysis and stress testing methodologies.

Proxy Voting and Engagement

governance

Track voting record on climate-related shareholder resolutions. Report engagement activities with portfolio companies on emissions reduction and climate strategy.

Transition Risk Exposure

business model

Report % of AUM invested in high-carbon sectors (oil & gas, utilities, materials). Disclose stranded asset risk under 1.5°C and 2°C scenarios.

Green and Sustainable Investment Products

business model

Disclose AUM in Article 8 and Article 9 funds (SFDR classification). Report assets in climate solutions, renewable energy, and green bonds.

NetNada tracks all SASB material topics, not just emissions. Our platform supports disclosure across environmental, social, governance, and business model topics relevant to your industry.

Asset Management & Custody Activities FAQs

Common questions about carbon accounting for this industry

How do you calculate financed emissions for listed equity using PCAF?
PCAF Listed Equity formula: Financed Emissions = (Market value of holding ÷ Company EVIC) × Company Scope 1+2 emissions. EVIC = Enterprise Value Including Cash = Market cap + Debt - Cash. Example: $10M investment in company with $5B EVIC and 1M tCO2 Scope 1+2 → Attribution = $10M ÷ $5B = 0.2% → Financed emissions = 0.2% × 1M = 2,000 tCO2. PCAF Data Quality Score 2 if company reports emissions.
Should we include Scope 3 emissions of portfolio companies in financed emissions?
PCAF allows optional inclusion of portfolio company Scope 3. Most asset managers report Scope 1+2 only due to data availability (PCAF Score 2-3). Including Scope 3 increases financed emissions 5-10x but degrades data quality to Score 4-5 (modeled estimates). Best practice: report Scope 1+2 as primary metric, Scope 1+2+3 as supplemental with clear methodology note.
How do you handle corporate bonds differently from equity?
Corporate bonds use outstanding amount attribution: (Bond market value ÷ Company total debt outstanding) × Company emissions. Challenge: debt outstanding data less available than EVIC. If unavailable, use EVIC proxy (assumes debt-to-EVIC ratio). PCAF Score 3 for bonds with debt data, Score 4 with EVIC proxy. Both equity and bonds of same company should sum to avoid double-counting across asset classes.
What carbon intensity metric should we report for portfolio benchmarking?
Three standard metrics: (1) Weighted Average Carbon Intensity (WACI) = Σ(Portfolio weight × tCO2/$M revenue) - most common, normalizes by company size. (2) Total Carbon Emissions (tCO2e absolute) = sum of financed emissions across all holdings - shows portfolio impact. (3) Carbon Intensity per $M AUM = Total financed emissions ÷ AUM - shows fund efficiency. Report all three for comprehensive view.
How frequently should we recalculate portfolio financed emissions?
Quarterly recalculation recommended to capture portfolio turnover. Holdings change via trades, market value fluctuates, company emissions update annually. Use: (1) Latest holdings file (quarter-end positions). (2) Most recent company emissions data (often 1-year lag). (3) Current EVIC/debt outstanding. Disclose data vintage in methodology notes (e.g., 'Q4 2025 holdings, company 2024 reported emissions').

Track Investment Portfolio Financed Emissions with PCAF Methodology

See how asset managers calculate portfolio carbon intensity, benchmark against indices, and generate NZAM and SFDR-compliant disclosures—automated from holdings data.

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