Mapping climate‑related metrics in the financial sector

2. Market practices

2.1. A comprehensive set of information points and metrics for the financial sector

A clear set of comparable, credible and transparent metrics is needed to track progress on GHG emission reduction targets by financial institutions. In this context, the OECD analysed the guidance the main voluntary frameworks provided on the information financial institutions should disclose in the report Assessing net-zero metrics for financial institutions (OECD, 2023[1]). The OECD analysis found commonalities in the topics these frameworks cover. Still, it noted limited alignment on specific metrics and calculation methods to assess the progress of financial institutions toward their net-zero targets. The topics and categories of the identified metrics are summarised in the first column of Table 2.1.

The second column states whether the identified metrics are currently made available by the commercial data providers whose datasets are used to develop the current report (Bloomberg, LSEG, Morningstar, MSCI, COGEM) for a non-negligible number of financial institutions. The column also shows in which figures of the paper the data is presented (information about the number of financial institutions disclosing the specific metric is included in the notes to the figures).

The third and fourth columns indicate in which sections of the two major international sustainability accounting standards the information points and metrics are requested: the IFRS S2 Climate-related Disclosures set by the International Sustainability Standards Board (ISSB) and the European Sustainability Reporting Standard (ESRS) E1 Climate Change adopted by the European Commission. The existence of disclosure requirements in those standards may signal that any data gaps for the relevant metrics and information points would be expected to be reduced soon with broader adoption of IFRS S2 and ESRS E1.

Table 2.1.  Most common topics and metric categories for financial institutions

Greenhouse Gas emissions metrics	Reference figures	IFRS S2	ESRS E1
Historic and current GHG emissions	Figure 2.1 Figure 2.2 Figure 2.2 Figure 2.3 Figure 2.7 Figure 2.8 Figure 2.5 Figure 2.8 Figure 2.9	IFRS S.2.29(a) IFRS S2.B19–B63	ESRS E1.6 (44-52) ESRS E1.6 (531-55) ESRS E1.AR39-52
GHG emission targets (short, medium and long-term)	Figure 2.10 Figure 2.11 Figure 2.12 Figure 2.13 Figure 2.14	IFRS S2.33-37	ESRS E1.4 (30) ESRS E1.4 (34) ESRS E1.AR23-31
Alignment assessment with a benchmark, including Paris Agreement	N/A	IFRS S.22(b)	ESRS E1.16(a) ESRS E1.AR5
Use of offsets (current and future)	N/A	IFRS S2.36(e)	ESRS E1.7 E1.AR56-64
Portfolio composition metrics
Portfolio share in low GHG assets and climate solutions	N/A	IFRS S2.16(c) IFRS S.2.29(e)	ESRS E1.16(c)(e)
Portfolio share in assets consistent with net zero, or with targets assessed on alignment		IFRS S2.16(c) IFRS S.2.29(e)	ESRS E1.16(c)
Portfolio share in carbon-intensive assets and assets exposed to transition risks and phase out		IFRS S.2.29(b)(c)(e)	ESRS E1.16(d)
Investment allocation practices driving GHG emissions reductions		--	ESRS E1.16(b)
Overall portfolio composition and sector coverage		IFRS S.2.29(e)	--
Engagement metrics
General engagement/stewardship practices	N/A	--	--
Voting procedures and practices	N/A	--	--
Engagement escalation process	N/A	--	--
Collaborations and alliance engagements	Figure 2.15	IFRS S.22(b)	ESRS E1.16(a) ESRS E1.AR5
Advocacy-based activities	N/A	--	--
Strategy and governance metrics
Remuneration linked to climate performance	Figure 2.20	IFRS S.2.29(g)	ESRS 2 GOV-3 (13)
Management/Board oversight and accountability	Figure 2.18 Figure 2.19	IFRS S.2.6(a)(b)	ESRS E1.13
Integration of climate considerations in internal reporting and analytical processes	N/A	IFRS S.2.6(b)(ii) IFRS S.2.15-21 IFRS S.2.22 IFRS S.2.24-26	ESRS E1.20-25 ESRS E1.26-29 ESRS E1.65-70 ESRS E1.AR8 ESRS E1.AR11-12 ESRS E1.AR13-15 ESRS E1.AR70-74
Integration of climate considerations in strategic decision-making and investment strategies	Figure 2.17	IFRS S.2.14(a)	ESRS E1.26 ESRS E1.28 ESRS E1.AR31
General strategy on climate goals and transition plans	Figure 2.16	IFRS 2.14(a)(b)(c)	ESRS E1.1 (14-15) ESRS E1.19 ESRS E1.26 ESRS E1.28 ESRS E1.AR1-2 ESRS E1.AR8 ESRS E1.AR31

¹ According to ESRS E1.53, companies shall disclose the GHG emission intensity based on net revenue.

Note: “N/A” means the metric is not currently available, or it is available only for a negligible number of financial institutions, in the commercial databases used for the dataset developed for the report.

Source: OECD, (2023[1]), Assessing net-zero metrics for financial institutions: Supporting the monitoring of financial institutions’ commitments, https://doi.org/10.1787/dedcfe56-en. EFRAG and IFRS Foundation, (2024[2]), ESRS–ISSB Standards: Interoperability Guidance, https://www.efrag.org/sites/default/files/sites/webpublishing/SiteAssets/ESRS-ISSB%20Standards%20Interoperability%20Guidance.pdf

2.2. Disclosure of GHG emission metrics

Public awareness and regulatory actions around climate change have accelerated in recent years. This has generated greater interest from investors in companies’ GHG emissions. A reporting system is an important first step in any effort to reduce GHG emissions. It requires accurately measuring, tracking, and reporting the emissions resulting directly from the company’s activities (scope 1), emissions indirectly related to energy consumption (scope 2), and emissions generated in the supply chain, including those by companies financed by the financial institution (scope 3). Compared to all other sectors, and due to the nature of their activities, scope 3 GHG emissions are particularly relevant to financial institutions, which account for the largest share of GHG emissions from the financial sector.

Figure 2.1 aggregates the reported historical GHG emissions of financial institutions listed globally in 2024. As the data coverage of the reported GHG emissions is relatively low (less than 20% of listed financial institutions disclosed such information in 2024), the aggregated disclosed GHG emissions cannot represent the whole financial sector. To ensure consistency, the analysis relies solely on information from one data provider (Bloomberg).

The share of financial institutions disclosing GHG emissions has been rapidly increasing over the past years, ranging from 6% (scope 1 and scope 2 GHG emissions) and 5% (scope 3 GHG emissions) of financial institutions in 2016 to 23% (scope 1 and scope 2 GHG emissions) and 19% (scope 3 GHG emissions) in 2024 (Figure 2.1).

Based on available data, disclosed scope 3 GHG emissions increased by a third from 2022 to 2024. The average annual disclosed scope 1 and scope 2 GHG emissions between 2022 and 2024 are fourteen times lower than the average annual scope 3 GHG emissions in the past three years.

Figure 2.1. Reported GHG emissions and data coverage of listed financial institutions, 2016-24

Note: Data coverage is calculated as the share of listed financial companies that disclose their GHG emissions relative to the total number of listed financial institutions. In 2024, 1 134 listed financial institutions disclosed scope 1 and 2 GHG emissions and 934 disclosed scope 3 GHG emissions.

Source: OECD Corporate Sustainability dataset, Bloomberg. See Annex A for details.

Globally, a relatively small percentage of financial institutions (23%) reported their scope 1 and 2 GHG emissions in 2024, as presented in Figure 2.2. However, data availability significantly increases when assessed by total assets, particularly in Europe (96%), the United States (87%) and Developed Asia-Pacific excl. US (85%).

Due to the lack of information about GHG emissions reported by the companies themselves, some service providers offer an estimation of the GHG emissions of individual companies. Financial institutions can use both reported and estimated data to obtain a comprehensive picture of their emission performance. While reported data offers direct insights from companies, estimated data can significantly improve data availability, especially in developing countries. This may allow institutions to fill gaps where reported data is lacking, ensuring a more robust and inclusive assessment of GHG emission metrics across regions and industries.

Nevertheless, it should be considered that estimated data have limitations, especially when comparing GHG emissions at the company level. Estimated data rely on broader evaluations tied to specific countries and sectors, rather than individual company performance. As a result, this approach provides a general understanding of GHG emissions trends. Still, it lacks the granularity needed to gauge the GHG emission performance of a specific company against its peers. This comparability gap may challenge financial institutions to determine whether an investee company is truly over- or underperforming in its climate efforts.

This paper uses two datasets for the estimation of GHG emissions, in addition to the data from the main data providers: one developed by Pladifes COGEM project, hosted at the Institut Louis Bachelier, and the one provided by MSCI (which only has estimates for scope 3 GHG emissions). While the methodologies for the two datasets meaningfully differ (the former relies on a machine learning model and the latter on a methodology with greater human input), they both use publicly available data, such as companies’ financial reports and regional carbon intensity generation data, to estimate GHG emissions by companies (Barreau, Fahmaoui and Tankov, 2024[3]; MSCI ESG Research LLC, 2023[4]).

Figure 2.2. Disclosure of reported and estimated scope 1 and 2 GHG emissions, 2024

Note: The data coverage for total assets and AUM of companies disclosing GHG emissions is 87% and 85%, respectively, of all listed financial institutions. Listed financial institutions for which there is either reported or estimated emission data are included in the analysis. The disclosure of reported and estimated scope 1 and 2 GHG emissions is based on available information from 4 922 listed financial institutions. The analysis includes information from 1 138 and 3 526 listed financial institutions with reported and estimated scope 1 and 2 GHG emissions, respectively. Reported GHG emissions data are collected from Bloomberg, and estimated data are collected from Bloomberg, COGEM and MSCI. For ease of reading, GHG emissions are shown on a scale up to 100 000 tons of CO₂e.

Source: OECD Corporate Sustainability dataset, Bloomberg, COGEM and MSCI. See Annex A for details.

The Greenhouse Gas Protocol (GHG Protocol), one of the most recognised standards for GHG emissions accounting, defines scope 3 emissions as all indirect emissions that occur in the value chain of the reporting company, including both upstream and downstream emissions.

Compared to scope 1 and 2 emissions, data coverage for reported scope 3 emissions is lower (Figure 2.3). In particular, reported emissions are more widely available for scope 1 and 2, especially for larger companies, which typically have greater reporting resources. While only 19% of scope 3 data is based on company-reported data, nearly half is based on estimates. Nevertheless, scope 3 emissions, both when reported and estimated, are substantially larger than scope 1 and 2. When considering all available information, estimated emissions are eight times larger than reported ones.

Figure 2.3. Disclosure of total scope 3 reported and estimated GHG emissions, 2024

Note: Listed financial institutions for which there is either reported or estimated emission data are included in the analysis. The disclosure of reported and estimated scope 3 GHG emissions is based on available information from 4 922 listed financial institutions. The analysis includes information from 929 and 2 830 listed financial institutions with reported and estimated scope 3 emissions, respectively. Reported GHG emissions data are collected from Bloomberg, and estimated data are collected from Bloomberg, COGEM and MSCI. For ease of reading, GHG emissions are shown on a scale up to 1 000 000 tons of CO₂e.

Source: OECD Corporate Sustainability dataset, Bloomberg, COGEM, MSCI. See Annex A for details.

The largest opportunity for financial service companies to reduce GHG emissions lies in their lending and investment activities. GHG Protocol classifies indirect emissions from a company’s value chain into 15 categories. The so-called “financed emissions” (category 15) represent most of financial institutions’ total GHG emissions and encompass the emissions deriving from financial institutions’ investments, including equity or debt investments and project finance (GHG Protocol, 2011[5]).

Between 2024 and 2023, reported scope 3 emissions increased across all regions but the United States. As shown in Figure 2.4, this change is strongly driven by the financed emissions, which rise in parallel in most of the regions, suggesting an improved ability of companies in disclosing this category. Notably, scope 3 emissions rose by nearly 5-fold for European financial institutions that reported them every year between 2022 and 2024. When looking at the reported financed emissions for the same group of companies, the increase is even more significant, at 6-fold. The null change of reported financed emissions in Middle East and Africa and other economies is due mainly to a lack of available information.

Conversely, reported scope 3 emissions declined in 2023 compared to the previous year, even in light of the smaller number of companies disclosing such information, as shown in Figure 2.1, Panel B. In most of the regions, the change in the reported financed emissions has the same sign as that of reported all scope 3 emissions, except in the United States, the Middle East and Africa and other economies.

Figure 2.4.  Changes in reported scope 3 emissions of a group of listed financial institutions

Note: The analysis includes 750 listed financial institutions that reported their scope 3 emissions in 2022, 2023 and 2024. The same group of companies is used to analyse year-on-year changes in both total scope 3 emissions and category 15 emissions.

Source: OECD Corporate Sustainability dataset, Bloomberg. See Annex A for details.

Among financial institutions that report financed emissions, 91% of their scope 3 GHG emissions, expressed in tons, are attributable to lending and investment activities. Financed emissions over all scope 3 GHG emissions are above the average for the insurance companies (Figure 2.5, Panel A). Financed emissions represent around 90% of all estimated scope 3 GHG emissions in almost all regions, except in the United States (32%) (Figure 2.5, Panel B).

Figure 2.5.  Reported and estimated scope 3, category 15 GHG emissions, 2024

Note: The figure is based on available information from 929 listed financial institutions reporting scope 3 emissions. The analysis includes information from 278 listed financial institutions reporting their category 15 GHG emissions. In Panel B, Middle East and Africa and other economies are not represented due to the limited number of financial institutions disclosing estimated category 15 GHG emissions in the country.

Source: OECD Corporate Sustainability dataset, Bloomberg, MSCI, COGEM. See Annex A for details.

By developing a scope 3 GHG emission inventory, companies can understand the overall emission profile of their upstream and downstream activities. This information provides companies with an understanding of where emissions and potential associated risks and opportunities lie in the value chain. It also allows them to assess the relative significance of scope 3 GHG emissions compared to their direct GHG emissions (GHG Protocol, 2011[5]). Table 2.2 and Box 2.1 provide an overview of key existing initiatives that financial institutions can adopt to disclose their scope 3 GHG emissions inventories and set relevant targets.

Box 1.1. Scope 3 GHG emissions in existing reporting initiatives

In 2006, the Intergovernmental Panel on Climate Change (IPCC) developed and revised in 2019 the IPCC Guidelines for National GHG Inventories, which provides a methodological framework for estimating national inventories of anthropogenic emissions (i.e., emissions deriving from human activities). The Guidelines describe the sources and sinks of GHG emissions. The Guidelines provide also methodologies for GHG inventory arrangements and management, data gathering, compilation, and reporting.

In 2015, the Financial Stability Board (FSB) developed the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), a set of voluntary disclosure recommendations for companies to provide information that aids investors and relevant stakeholders in making informed decisions about climate-related financial risks. The TCFD recommendations covered companies’ governance, strategy and risk management, as well as climate-related metrics and targets, including the scope 3 GHG emissions. In 2023, the TCFD completed its mandate. Its recommendations have been incorporated into the ISSB’s IFRS S2.

Among various methodologies, the GHG Protocol Corporate Value Chain (scope 3) Accounting and Reporting Standard, issued by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), provides initial and detailed guidance for companies to set scope 3 boundaries and calculate scope 3 GHG emissions (GHG Protocol, 2011[5]). In conformance with the requirements set forth in this standard, the Partnership for Carbon Accounting Financials (PCAF) published an accounting and reporting standard on financed emissions, outlining an approach to calculate GHG emissions resulting from activities financed through lending and investment portfolios (scope 3, category 15 emissions).

To address the demand for comparable emission data, there has been collaboration around the interoperability of related standards. In May 2024, the International Sustainability Standards Board (ISSB) and the European Financial Reporting Advisory Group (EFRAG) published an interoperability guidance to facilitate the implementation of the standards (EFRAG and IFRS Foundation, 2024[2]). The ISSB also coordinates work with the International Accounting Standards Board (IASB) and the GRI to facilitate the standards’ interoperability. Likewise, the CDP climate change questionnaire is aligned with the TCFD recommendations.

Some initiatives may require companies not only to disclose their GHG emissions but also to set their reduction targets. For instance, this is the case of Science Based Targets initiative (SBTi), in which companies must set long-term, science-based targets that align with a global average temperature 1.5°C higher than in pre-industrial times for a target year no later than 2050 as part of their net-zero commitment (SBTi, 2024[6]).

The International Organization for Standardization (ISO) provides organisations with guidelines to achieve unified, consistent practices across geographies and industries. Notably, ISO 14064-1:2018 (International Organization for Standardization, 2018[7]) focuses on the quantification and reporting of GHG emissions and removals at the organisational level and provides guidance on preparing a comprehensive GHG emission inventory, covering GHG emissions that arise throughout the value chain. Given the complexity of scope 3 accounting, ISO 14064-1:2018 provides a framework to offer clarity and ensure transparency, completeness, and accuracy in emissions reporting.

Table 2.2. 1 Scope 3 GHG emissions in existing reporting initiatives

Institution	Main Initiative	Disclosure content of scope 3 emissions		Calculation guidance on scope 3 GHG emissions	Users
		Category-level*	Portfolio-level**
World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD)	GHG Protocol Corporate Value Chain Accounting and Reporting Standard 2011	Total scope 3: Required Each category: Required	-	Yes	All sectors
Financial Stability Board (FSB)	Task Force on Climate-related Financial Disclosures (TCFD) Framework 2017	Total scope 3: Recommended Each category: -	-	No	All sectors
International Sustainability Standards Board (ISSB)	International Financial Reporting Standards S2 Climate-related Disclosures 2023	Total scope 3: Required Each category: Required	-	Yes	All sectors
European Union (EU)	European Sustainability Reporting Standards 2023	Total scope 3: Required Each category: Required	-	Yes	All sectors
Paris Aligned Investment Initiative	Net Zero Investment Framework 2021	Total scope 3: Recommended Each category: -	Listed equity Corporate bonds Lending activities Project finance	No	All sectors
Science Based Targets initiative (SBTi)	Financial Sector Science-Based Targets Guidance 2022	Total scope 3: Recommended Categories 1-14: Recommended Category 15: Required	Listed equity Corporate bonds Lending activities Project finance	Yes	Financial sector
Partnership for Carbon Accounting Financials (PCAF)	The Global GHG Accounting and Reporting Standard Part A: Financed Emissions 2022	Total scope 3: Required Each category: Required	Listed equity Corporate bonds Sovereign debt Lending activities Project finance Insurance underwriting	Yes	Financial sector
CDP	CDP Climate Change Questionnaire and Reporting Guidance 2023	Total scope 3: Required Each category: Required	-	No	All sectors (sector-specific requirements)
Intergovernmental Panel on Climate Change (IPCC)	2019 Refinement to the 2006 IPCC Guidelines for National Greenhouse Gas Inventories	-	-	Yes	All sectors
ISO	ISO 14064-1:2018	Total scope 3: Recommended Each category: -	-	Yes	All sectors

Note: * “Required” classification is where terms such as “require”, “required”, “shall”, “must” and/or “required if significant” are used in the report; and “Recommended” classification is where terms such as “recommend”,” recommended”, “to the extent possible” and/or “may” are employed in the report. “-” means no reference to these terms in the report.

** Portfolio-level column includes details when the disclosure of specific asset classes is required or recommended (rather than only a broader disclosure for scope 3 or category 15).

Source: Standards, frameworks and websites of the institutions visited between March 2024 and July 2025; OECD elaboration.

The financial sector may face significant challenges in measuring and reporting GHG emissions due to evolving methodologies and data availability, especially for financed emissions. Notably, data availability and quality could vary across the value chain, especially for smaller businesses in emerging markets and developing economies. If a financial institution engages with multiple stakeholders across the value chain, resource constraints may limit its ability to report emissions. Additionally, methodologies often provide different levels of granularity to identify the drivers of financed emissions. This can make it difficult to understand and compare emission disclosures, potentially obscuring individual activities that deviate from the transition pathway but remain hidden when the data is aggregated. If reporting methodologies are widely used, gaps remain for large asset classes such as private equity, loans, and sovereign bonds, creating blind spots where climate concerns may go unnoticed (Network for Greening the Financial System, 2024[8]). Such methodological gaps can create blind spots that limit the visibility of the financing that continues to be allocated to non-climate activities.

Furthermore, alongside physical risk exposures, companies in high-emitting industries are more likely to face regulatory, market, and reputational risks during the transition to a low-carbon economy. Evaluating portfolio composition is crucial for identifying both physical and transition risk exposures, ultimately enabling more effective risk management. For these reasons, GHG emissions metrics need to be complemented by portfolio composition metrics, including investments in climate solutions and carbon-intensive assets, as well as information on engagement, strategy and governance (Table 1.1).

Tracking the share of a portfolio in high-emitting industries or by specific technologies may be particularly relevant for informed decision-making, especially when GHG emissions data from investee companies are lacking. By assessing the share of investments in high-emitting industries, investors can estimate the potential carbon intensity of their portfolios, even in the absence of direct GHG emission data. This enhances understanding of portfolio alignment with net-zero goals and encourages investor engagement with these companies.

Harmonising the industry classifications employed by companies and data providers is essential to ensure the comparability of portfolio composition metrics. The need for standardisation also applies to financial instruments, particularly those with sustainability characteristics. In this context, the EU Platform on Sustainable Finance has aimed to categorise financial products that pursue sustainability strategies (EU Platform on Sustainable Finance, 2024[9]).

Globally, only half of the financial institutions reporting their GHG emissions in 2024 provide details on the methodology they employ to account for the emissions. The GHG Protocol standards are consistently used across all regions. Notable exceptions are observed in China, where 19% of companies owning 32% of total assets reported GHG emissions according to the IPCC GHG Guidelines (Figure 2.6).

Figure 2.6.  Methodologies used for GHG emission reporting, 2024

Note: The disclosure of the methodologies used for GHG emission reporting is based on available information from 1 166 listed financial institutions disclosing GHG emissions. The use of a specific methodology for their GHG emission reporting is disclosed by 619 listed financial institutions.

Source: OECD Corporate Sustainability dataset, Bloomberg, LSEG. See Annex A for details.

In Figure 2.2 and Figure 2.3, the last column shows total reported and estimated GHG emissions by different groups of financial institutions. In Figure 2.7 below, total reported and estimated GHG emissions (for all scopes) are for the same group of financial institutions, for which data is available for both actual disclosure and estimation by a third-party. Globally, only one-fourth of listed financial institutions disclosed both estimated and reported data in 2024, with similar percentages regionally. A noteworthy exception is China, where investors can have access to both reported and estimated data for 70% of listed financial institutions. In this comparison, it is possible to see how much financial institutions may be underreporting their GHG emissions according to the existing estimations.

Figure 2.7.  Reported and estimated GHG emissions for all scopes of a group of listed financial institutions, 2024

Note: The figure displays aggregated data for which both actual disclosure and estimation by a third-party are available in 2024. Only listed financial institutions that provide both reported and estimated emission data are included in the analysis. The disclosure of reported and estimated GHG emissions is based on available information from 1 166 listed financial institutions. Reported GHG emissions data are collected from Bloomberg, and estimated data are collected from Bloomberg, COGEM and MSCI.

Source: OECD Corporate Sustainability dataset, Bloomberg, COGEM, MSCI. See Annex A for details.

There are several reasons for financial institutions to disclose their carbon performance in terms of absolute emissions. Absolute emissions metrics are straightforward and closely tied to the global carbon budget, making them easy to interpret and calculate. Moreover, they provide a clear overview of total emissions without requiring extensive data inputs. Widely available and applicable to all asset classes, absolute emissions represent a practical choice for tracking emissions. Nevertheless, emissions reductions reflected by these metrics might occur because the investee companies have scaled down their production or operations, rather than actual improvements in climate performance. This may lead to a partial picture of how effectively a company is tackling climate challenges.

Intensity-based metrics assess GHG emissions relative to output, offering a clearer perspective on efficiency improvements regardless of a company’s size or growth. Emission intensity per asset is a key metric for assessing the environmental impact of financial institutions, providing insight into their emissions relative to their asset base. Financial institutions seeking greater comprehensiveness in their emission disclosures may favor carbon intensity-based metrics, as they highlight performance relative to their investments.

A lower emission intensity indicates that a company generates fewer emissions for each dollar of assets, reflecting better sustainability practices and a reduced carbon footprint. When companies integrate environmental considerations into their operations, reducing emission intensity becomes a key goal, particularly for institutions managing large asset portfolios. However, these metrics are more complex to calculate, require extensive data, and may make comparisons between companies with different activities challenging. Furthermore, when assessing the historical performance, investors should consider that intensity-based metrics are potentially affected by fluctuations in macroeconomic conditions and that, even if climate performance improves on an intensity basis, total emissions could still rise.

Emission intensity is higher when considering the reported scope 3 GHG emissions, which reflects the greater relevance of these emissions for the financial sector. Emission intensity is near zero for both scope 1 and 2 in China, the United States and Europe, while it reaches 5 tons of CO₂e per million USD in the Middle East and Africa (Figure 2.8).

Scope 3 emissions intensity is above the global average in Europe (38 tons of CO₂e per USD million), Developed Asia-Pacific excl. US (22 tons of CO₂e per USD million), and Emerging and Developing Asia excl. China (24 tons of CO₂e per USD million).

Figure 2.8. Reported and estimated GHG emission intensity per assets, 2024

Note: The economic intensity of scope 1 and 2 GHG emissions and scope 3 GHG emissions is calculated by dividing tons of CO₂e emissions by total assets in million US dollars. When reported emissions are unavailable, estimated emissions are used. The reported and estimated GHG emission intensities are based on available information from 3 526 (scope 1 and 2) and 929 (scope 3) listed financial institutions. The emission intensity calculation is based only on the total assets of financial institutions disclosing scope 1 and 2 (blue bar) or scope 3 (green bar).

Source: OECD Corporate Sustainability dataset, Bloomberg, COGEM, MSCI. See Annex A for details.

Although GHG emissions might be subject to a different level of assurance than other sustainability-related information, financial institutions show similar trends compared to the assurance of their broader sustainability-related reports (OECD, 2024[10]). Globally, only one-third (31%) of all financial institutions representing two-thirds of total assets (67%) assured their reported GHG emissions in 2024 (Figure 2.9). In the United States, 37% of the financial institutions accounting for 83% of total assets owned and managed assured their GHG emissions. Compared with other financial institutions, insurance companies are the biggest assurers by number of companies in several regions, especially in Developed Asia-Pacific excl. US (54%), Europe (54%) and Latin America (29%).

The global assurance of GHG emissions by third parties is homogenous across regions but varies significantly by emission scopes. Globally, 24% of scope 1 GHG emissions, 38% of scope 2 emissions, and 64% of scope 3 emissions are independently assured by third parties. In the United States and Latin America, the majority of reported GHG emissions undergo voluntary third-party verification.

Figure 2.9.  GHG emissions with external assurance, 2024

Note: The disclosure of the use of assurance on GHG emission reporting is based on available information from 1 166 listed financial institutions disclosing GHG emissions. The analysis includes information from 360 listed financial institutions assuring their scope 1, 2 or 3 emissions.

Source: OECD Corporate Sustainability dataset, Bloomberg. See Annex A for details.

2.3. Disclosure of GHG emission reduction targets and net-zero commitments

To effectively mitigate GHG emissions and align with corporate climate goals, it is helpful for financial institutions to adopt a comprehensive strategy that encompasses robust net-zero commitments, and transparent disclosure of GHG emission reduction targets. This commitment lays the foundation for credible climate action and helps build trust among stakeholders. Disclosure of GHG emission reduction targets is crucial for accountability and transparency, enabling stakeholders to assess progress and hold organisations accountable for their commitments. Clear, measurable targets not only guide internal efforts but also enhance public trust and investor confidence.

Globally, 908 listed financial institutions have set a GHG emission target, accounting for 78% of total assets and 77% of AUM (Figure 2.10). Developed Asia-Pacific excl. US has the highest share of listed financial institutions disclosing GHG emission reduction targets (33%), followed by Europe (32%) and China (24%).

Figure 2.10.  Disclosure of GHG emission reduction targets, 2024

Note: The disclosure of GHG emission targets is based on available information from 4 922 listed financial institutions. The analysis includes information from 908 listed financial institutions disclosing reduction targets.

Source: OECD Corporate Sustainability dataset, Bloomberg, MSCI, LSEG, SBTi Target Dashboard. See Annex A for details.

Listed financial institutions with significant total owned assets or significant AUM are more likely to set GHG emission reduction targets. For instance, 12% of listed financial companies in Latin American economies reported emission reduction targets, accounting for 79% of total assets and 96% of AUM. A similar pattern arises in the United States, Europe, and Developed Asia-Pacific excl. US.

For financial institutions, setting reduction targets for scope 3 GHG emissions, particularly in category 15 (investments), is essential to advancing their net-zero targets. This strategy extends their influence beyond direct operations, mitigating financial risks and aligning with global climate goals.

Globally, 27% of listed financial institutions have published a reduction target including their scope 3 GHG emissions, while 22% also included their category 15 scope 3 GHG emissions in the target (Figure 2.11). This means that, globally, about 80% of the institutions that have set a scope 3 target also considered financed emissions in the target, ranging from 71% in Developed Asia-Pacific excl. US to 93% in the United States.

Europe has the highest percentage of financial institutions setting a reduction target for scope 3 GHG emissions, including their category 15 GHG emissions. Thirty-seven percent of listed financial institutions (83% by total assets and 64% by AUM) in Europe disclosed the scope 3 GHG emission targets and 31% also set reduction targets for the category 15 of scope 3 GHG emissions.

Figure 2.11. Financial institutions setting scope 3 GHG emissions reduction targets, 2024

Note: The disclosure by listed financial institutions setting reduction targets is based on available information from 908 listed financial institutions disclosing reduction targets. The analysis includes information from 241 and 195 listed financial institutions disclosing total scope 3 and category 15 scope 3 GHG emissions, respectively. In the figure, China is not represented due to the limited number of financial institutions disclosing reduction targets for financed emissions in the country. Latin America’s shares could be underrepresented due to lack in data availability.

Source: OECD Corporate Sustainability dataset, Bloomberg, MSCI, LSEG, SBTi Target Dashboard. See Annex A for details.

The disclosure of detailed target metrics, such as the target year, baseline year, and baseline emissions allows comparable analysis. These metrics provide clarity, enhance transparency and accountability, support evidence-based decision-making, and build credibility with stakeholders.

The baseline year and target year are necessary for investors and stakeholders to assess the meaning of GHG emission reduction targets (both in relative and absolute terms) for an individual company. In general, the availability of the target year is higher than that of the baseline year. Globally, the baseline year is available for only half of the companies disclosing reduction targets (65% by total assets and 62% by AUM), while 86% of companies (94% by total assets and 97% by AUM) disclosed the target year (Figure 2.12). In Developed Asia-Pacific excl. US, two-thirds of financial institutions by number of companies reported the baseline year and 91% the target year.

Figure 2.12. Financial institutions with emission targets disclosing baseline and target years, 2024

Note: The disclosure of listed financial institutions with GHG targets is based on available information from 908 listed financial institutions disclosing reduction targets. The analysis includes information from 461 and 783 listed financial institutions that disclose a baseline year and a target year, respectively.

Source: OECD Corporate Sustainability dataset, Bloomberg, MSCI, LSEG, SBTi Target Dashboard. See Annex A for details.

The disclosure of baseline emissions provides a clear reference point and enables effective monitoring. Compared with other target details, the baseline emissions are least disclosed by financial companies. Only 26% of listed financial institutions (50% by total assets and 46% by AUM) globally disclosed the baseline emissions (Figure 2.13). In Developed Asia-Pacific excl. US, 39% of companies in the financial sector disclosed their baseline emissions to reach reduction targets, representing roughly two-thirds of total assets and AUM. In Emerging and Developing Asia excl. China, only 12% of the companies disclosed baseline emissions but they account for 37% of regional total assets and AUM.

Figure 2.13. Listed financial institutions disclosing baseline emissions, 2024

Note: The disclosure of listed financial institutions with GHG emission targets is based on available information from 908 listed financial institutions disclosing reduction targets. The analysis includes information from 237 listed financial institutions that disclose baseline emissions. In the figure, China is not represented due to the limited number of financial institutions disclosing baseline emissions in the country.

Source: OECD Corporate Sustainability dataset, Bloomberg, MSCI, LSEG, SBTi Target Dashboard. See Annex A for details.

2.3.1. Adherence to voluntary initiatives

Science-based emission targets are those that align with the objectives of the Paris Climate Agreement, aiming to restrict global warming to well below 2 degrees Celsius above pre-industrial levels. Net-zero reduction targets aim to achieve the point where the GHG emissions released into the atmosphere equal the amount removed from it. The balance can be achieved by reducing emissions across all sectors and offsetting any remaining emissions through carbon removals.

Globally and across regions, most listed financial institutions demonstrate a high ambition and engagement in setting a net-zero emission target. Seventy-eight per cent of listed financial institutions claim that their targets aim to achieve net-zero GHG emissions (Figure 2.14). Developed Asia-Pacific excl. US and Europe are the top two regions whose financial institutions disclosed their engagement in setting GHG emission reduction targets to reach net-zero balance and the goals of the Paris Climate Agreement. Conversely, only 41% of listed financial institutions disclosing reduction targets declare their ambition and engagement in setting science-based GHG emission reduction targets.

Figure 2.14. Disclosure of science-based and net-zero GHG emission reduction targets, 2024

Note: The disclosure of science-based targets and net-zero targets is based on available information from 908 listed financial institutions disclosing reduction targets. The analysis includes information from 372 and 707 listed financial institutions that disclose science-based targets and net-zero targets, respectively. The first group includes listed financial institutions that disclose a GHG emission reduction target and that the target is science-based. The second group includes listed financial institutions that disclose a GHG emission target and that the target is aligned with net-zero goals. The disclosure of science-based targets is intended when the company claims that the disclosed target is linked to science-based temperature scenarios, including, but not limited to, targets that have been submitted to and reviewed by the SBTi. The disclosure of net-zero targets is meant when the disclosed target aims for net-zero emissions, as defined by the company.

Source: OECD Corporate Sustainability dataset, Bloomberg, MSCI, SBTi Target Dashboard. See Annex A for details.

The SBTi guidance for the financial sector (hereafter “SBTi-FI”) uses backward-looking emission-based metrics to quantify financed emissions alongside forward-looking target-based metrics to evaluate alignment to plans or pathways aligned with the Paris Climate Agreement. SBTi-FI enables a financial institution to use GHG emission metrics to define portfolio decarbonisation targets.

SBTi requires financial institutions to disclose high-quality and transparent emission data, tracking progress through an action plan to achieve the targets. Financial institutions must set near-term science-based targets, align them with 1.5°C pathways, and assess their financing activities related to fossil fuels. SBTi provides a specific methodology to set science-based targets for financial institutions, makes available a reporting tool, and outlines validation criteria and recommendations to ensure the targets are credible, science-based, and effective.

Commitment to the SBTi starts by submitting a letter establishing an intention to set a science-based target. Companies in the financial sector have much less commitment to setting emission targets in line with the SBTi, compared to disclosing GHG emission reduction targets, science-based targets and net-zero targets. Fourteen per cent of listed financial institutions by total assets have committed to setting science-based emission reduction targets globally (Figure 2.15). In Europe, 8% of listed financial institutions, corresponding to 39% of regional total assets, have submitted a letter to the SBTi committing to develop science-based targets.

Figure 2.15. Commitment to the SBTi targets by listed financial institutions, 2024

Note: The disclosure of the commitment to SBTi targets is based on available information from 4 922 listed financial institutions. The analysis includes information from 160 listed financial institutions committing to the SBTi targets. In the figure, China and Middle East and Africa are not represented due to the limited number of financial institutions disclosing reduction targets for financed emissions in the country and region. Shares of Latin America, Emerging and Developing Asia excl. China and the United States could be underrepresented due to a lack of data availability.

Source: OECD Corporate Sustainability dataset, SBTi Target Dashboard, Bloomberg, MSCI. See Annex A for details.

Glasgow Financial Alliance for Net Zero (GFANZ) is a coalition of leading financial institutions committed to accelerating the net-zero transition and fostering a commitment to achieving net-zero goals by 2050. The GFANZ Net Zero Transition Plan framework recommends strategies for financial institutions to decarbonise portfolios in line with net-zero 2050 targets. At the end of 2024, over 700 financial institutions, including 80% of G-SIBs, are members of the GFANZ, with more than two-thirds having set out their plans for net-zero transition in line with the GFANZ Net-Zero Transition Plan framework (Glasgow Financial Alliance for Net Zero, 2024[11]).

The Net Zero Investment Framework (NZIF), developed by the Institutional Investors Group on Climate Change (IIGCC), provides a comprehensive roadmap for investors to decarbonise their portfolios, guiding asset owners and asset managers on how to set targets, assess emissions, and allocate capital towards low-carbon solutions.

Both initiatives are integral to embedding net-zero commitments into the core operations of financial institutions. By adopting the NZIF, institutions gain a clear methodology to implement climate-conscious investment strategies, while GFANZ ensures collaboration and accountability across the financial sector. Together, they represent a systematic approach to support the low-carbon transition, while actively managing climate risks in portfolios.

Transition plans are a crucial element of climate-related disclosures, offering insights into how companies are preparing for risks, opportunities, and potential business model shifts arising from the climate transition. Transition plans serve as an essential tool for investor decision-making, thereby enhancing market efficiency and supporting capital allocation and risk management. Transition plans can also help micro-prudential authorities ensure the safety and soundness of financial institutions by assessing the impact of climate change on their strategy and operations. This can prompt supervisors to engage with financial companies on how to measure their progress in reducing exposure to climate-related risk across short-, medium-, and long-term horizons (Network for Greening the Financial System, 2025[12]). Additionally, they can play a significant role in shaping the design of sustainability-labelled funds and financial instruments. The definition of a transition plan differs among jurisdictions, largely shaped by the disclosure standards and framework guidelines each region chooses to adopt (The Board of the International Organization of Securities Commissions, 2024[13]).

According to the ESRS, a transition plan is part of a company’s overall strategy, outlining the goals, actions and resources needed to move towards a low-carbon economy. This includes measures such as reducing GHG emissions and achieving climate neutrality. The ESRS require companies to disclose information on their ongoing climate-related transition plans publicly. Nevertheless, under the EU Omnibus Simplification Package, which revises and simplifies the Corporate Sustainability Reporting Directive, the requirement for companies to adopt a transition plan for climate mitigation would be removed.

The GFANZ considers transition plans as a strategic action plan that encompasses all operations of an organisation. A transition plan is defined as a set of goals, actions, and accountability mechanisms to align business operations with a path towards achieving net-zero GHG emissions, resulting in a tangible reduction of emissions in the real economy. According to the GFANZ, a transition plan should be aligned with the goal of reaching net-zero emissions by 2050, in accordance with Paris Climate Agreement objectives. To reach this net-zero goal, the GFANZ requires a multifaceted approach, with financial institutions to set specific operational targets, like maintaining a certain share of green loans. The GFANZ framework is not focused on the disclosure but provides a guideline for the development of transition plans by financial institutions.

While the GFANZ represents one of the most comprehensive and cross-cutting global initiatives in sustainable finance, other sector-specific alliances also play an important role in advancing net-zero objectives within their respective domains. Among them, the Net-Zero Banking Alliance (NZBA) brought together banks committed to aligning their lending and investment portfolios with net-zero emissions by 2050. Broadly aligned with the goals and principles of the GFANZ, the NZBA operated as an independent initiative tailored to the banking sector and built upon the GFANZ framework to guide its members. In October 2025, the NZBA announced the cessation of its operations.

The ISSB requires companies to provide information on how they plan to address climate-related risks and opportunities in their strategy and decision-making processes, taking into account any climate goals they have set. This is part of an organisation’s overall strategy. Specifically, IFRS S2 requires companies to disclose information on their climate-related transition plans, outlining the key assumptions used in their development and the dependencies upon which these plans are based.

The Transition Plan Taskforce (TPT), established by the UK government in 2022, was tasked with developing a gold standard for climate transition plan disclosure. The TPT Framework offers a set of recommendations to help an entity more effectively disclose its transition plan, designed to be consistent with, and build on, the ISSB. It recommends that entities integrate material information about transition plan into their general purpose financial reports, but notes that some companies may prepare a standalone transition plan as good practice. The TPT Framework builds on the transition plan guidance developed by GFANZ, thereby promoting international alignment on the key elements that constitute a robust and credible transition plan. According to the TPT, a well-designed transition plan clearly articulates the company’s objectives and priorities for responding and contributing to the low-carbon, climate-resilient transition, while managing climate-related risks and opportunities. The TPT provides recommendations to enhance the effectiveness of transition plan disclosures, with a focus on ensuring firms consider three interrelated channels – decarbonising the entity, responding to the entity’s climate-related risks and opportunities, and contributing to an economy-wide transition. The IFRS Foundation assumed responsibility for the TPT Framework in 2024 and has used it to develop educational materials on transition plan disclosures, in accordance with IFRS S2.  

In 2024, only 8% of global financial institutions publicly disclosed that they had an active climate-related transition plan in place (Figure 2.16). Developed Asia-Pacific excl. US and Europe have the highest proportion of institutions with established climate transition plans, although the number does not exceed 17%.

Figure 2.16. Transition planning by financial institutions, 2024

Note: The disclosure of the transition planning is based on available information from 4 922 listed financial institutions. The analysis includes information from 393 listed financial institutions disclosing a transition plan. In the figure, China is not represented due to the limited number of financial institutions disclosing reduction targets for financed emissions in the country.

Source: OECD Corporate Sustainability dataset, Bloomberg, LSEG. See Annex A for details.

2.4. Corporate governance and risk assessment disclosure

Another useful step for financial institutions is considering different possible scenarios caused by climate change and identifying potential risks and opportunities. This process usually includes identifying and classifying scenario-related risks and opportunities and including them in the companies’ risk management process.

As shown in Figure 2.17, identifying climate-related risks as material to the company is most common among retail and commercial banks and insurance companies with high percentage of companies. Across all financial institutions, China (63%) and the United States (57%) have the highest percentage. However, only 22% of companies globally identify climate-related risks as material, and even fewer in developing regions that tend to be more affected by climate change.

Figure 2.17. Climate-related risks identified as material by financial institutions, 2024

Note: The disclosure of climate-related risks identified as material by financial institutions is based on 4 922 listed financial institutions. The analysis includes information from 1 106 listed financial institutions conducting materiality assessment of climate-related risks. In the figure, asset managers’ shares could be underrepresented due to a lack of data availability, across all regions.

Source: OECD Corporate Sustainability dataset, Bloomberg, MSCI. See Annex A for details.

Among all regions, financial institutions identifying climate-related risks as material are equally active in ensuring their boards oversee those risks. Similarly, the largest institutions within each region are the ones that focus most on integrating climate change into the companies’ governance. In China, companies self-reporting oversight of climate-related issues represent the highest share by number of companies (57%), corresponding to 91% by total assets and 88% by AUM (Figure 2.18).

Figure 2.18. Self-reported board-level oversight of climate-related issues, 2024

Note: The disclosure of the self-reported board-level oversight of climate-related issues is based on 4 922 listed financial institutions. The analysis includes information from 827 listed financial institutions disclosing board-level oversight on climate-related issues.

Source: OECD Corporate Sustainability dataset, Bloomberg. See Annex A for details.

A sustainability committee may support the management and oversight of sustainability in a focused and coordinated way across the company (IFC, 2021[14]). Establishing a board committee responsible for sustainability is not the only way for a company to manage its sustainability risks, and a committee, if not well structured, may even be ineffective in doing so (OECD, 2024[10]). However, the existence of a sustainability board committee may be a proxy for the importance boards place on sustainability-related risks.

In China, 50% of all financial institutions have a sustainability board committee. The other regions range from 35% (United States) to 8% (Emerging and Developing Asia excl. China) (Figure 2.19). A similar picture also emerges when looking at total assets, with companies representing 85% of total assets in China having a sustainability board, compared to only 37% in the Middle East and Africa.

Figure 2.19.  Existence of a board committee responsible for sustainability, 2024

Note: The disclosure of the board committees responsible for sustainability is based on available information from 4 922 listed financial institutions. The analysis includes information from 770 listed financial institutions. In the figure, other economies’ shares could be underrepresented due to a lack of data availability.

Source: OECD Corporate Sustainability dataset, Bloomberg. See Annex A for details.

To fulfil their key functions in assessing the company’s risk profile and guiding its governance practices, boards may also consider sustainability matters when establishing key executives’ compensation. Figure 2.20 shows the percentage of listed financial institutions that link executive compensation to sustainability matters in 2024, by number of institutions, total assets, and AUM.

Figure 2.20.  Executive and board compensation linked to sustainability matters, 2024

Note: The disclosure of the executive compensation linked to sustainability matters is based on available information from 4 922 listed financial institutions. The analysis includes information from 748 listed financial institutions disclosing executive or board compensation linked to sustainability matters.

Source: OECD Corporate Sustainability dataset, Bloomberg, LSEG. See Annex A for details.