Phase out of Portfolio Coverage Approach?

Net Zero for FIs
1

Dear SBTi-Team

We recently had a meeting about SBTi targets with consultants and they did not recommend to us to set targets according to the the portfolio coverage approach due to a potential phase out from SBTi framework. Is this true that there are discussions or intentions to phase out this approach and if yes, by when?

Kind regards

Claudia

2

hi - did you get an answer? this is relevant!

3

No, unfortunetly not yet. Have you heard similar rumours?

4

Apologies for missing this post as we are working on updating the FI Near-Term Criteria (which still includes the Portfolio Coverage method). I am not aware of any such discussions or intentions. Do you know where the consultants got this rumor from?

5

Dear Howard,

Please can you let me know if the “portfolio coverage method” on its own is sufficient for SBTi as a net zero target setting for an asset manager? I have seen targets such as “50% of portfolio company financed emissions setting a science-based target by 2030”. Would this be an acceptable target for net zero, without having a portfolio decarbonisation target? And if so, would it also be valid for the new FINZ Standard being developed? I am assuming it has not been released yet?

Many thanks for your guidance.

Maryse

6

Hi Maryse, the FINZ Standard is still under development and will go through another round of public consultation as well as pilot testing this year so we welcome your participation.

7

Thank you very much Howard for letting me know, that is very helpful.

I wondered if you had an answer for my question on portfolio coverage? Thanks so much

Maryse

8

Since the FINZ Standard is under development, that means there is no finalized document yet for me to base an answer on. If you’re asking about the Financial Institutions’ Near-Term Criteria Version 2.0, the Portfolio Coverage method is indeed one of the options available for certain asset classes.