Hi @yeunhl,
Apologies for the late reply. With portfolio coverage you can always have data for all assets as the method is binary. Either the underlying assets have an approved SBT or they have not. If you don’t know because lack of data of underlying assets, one part of the task as a financial institution is to help to improve data quality, e.g. through engaging asset mangers, product and service providers to improve, transparency, data availability and quality of underlying assets.
For FoF for instance, there are data providers (e.g. Bloomberg and Morningstar) in the market that can provide x-rays on FoF several levels deep to get information of the underlying assets.
Regarding the question of short positions, these are currently not in scope and can be excluded.
Also, remember that you don’t have to achieve the targets on day one. So, if you don’t know you have until 2040 for the last assets, in the extreme, to gather the required data and and engage with the underlying assets, if necessary.
In conclusion, all assets can be covered by portfolio coverage and temperature rating, separately or in combination. Hence, you should calculate your baseline coverage on all your assets excluding those that are explicitly out of scope, e.g. short positions.
In your case it means that you should still include the assets for which you don’t have any data (excluding short positions) and assume that these have not set an SBTi-approved SBT, as you don’t know. Over the coming years, it’ll become your task to gather more data on these assets.
After all, we want all companies to set ambitious emissions reduction targets (and achieve them). Thus, the first job is to fully understand what the landscape looks like for all companies, not just the companies, asset managers, product/service providers, etc. that have transparent ESG reporting.