Carbon footprint of the holdings of corporate bonds

The carbon footprint is a calculation of the greenhouse gas emissions that arise from, for example, a company’s operations. A common metric used when reporting the carbon footprint is carbon intensity, which shows a company’s emissions in relation to its revenue.

Here, we report the carbon footprint for the Riksbank’s holdings of corporate bonds. We have weighted each company’s carbon intensity against its share of the corporate bonds in the Riksbank’s portfolio (the so-called ‘Weighted Average Carbon Intensity, WACI’).

The carbon footprint calculation is based on both the company’s emission data and quantitative emission estimates. As the majority of the companies in the portfolio do not disclose their emissions, the results are relatively uncertain and provide more of an indication of the carbon footprint for the Riksbank’s holdings of corporate bonds rather than a precise calculation (see note).

Weighted average carbon intensity

Figure: Weighted average carbon intensity

Note. The weighted average carbon intensity is reported in tonnes of carbon per USD million of revenue.

The weighted average carbon intensity is reported for all companies the Riksbank has in its portfolio of corporate bonds and calculated on the basis of companies’ reported emissions and estimates made by Sustainalytics. Of all the companies that fulfil the Riksbank’s purchase criteria as of 1 February, only 40 per cent of them (19 out of 51) disclose their greenhouse gas emissions. Sustainalytics has estimated the greenhouse gas emissions of the remaining 32 companies. 53 per cent of the value of the Riksbank’s bond holdings comprises bonds issued by companies that disclose data.  The weighted average carbon intensity is updated quarterly and was last updated on 1 February 2021. As from 31 March, the data will be updated at the end of each quarter. Source: Sustainalytics and the Riksbank.

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Updated 31/03/2021