WEBVTT 00:00:07.000 --> 00:00:12.000 All right, a very good day, everyone, and welcome to the PCAF launch webinar. 00:00:12.000 --> 00:00:18.000 My name is Caspar Noach, I'm a technical director of PCAF, which means that my role is to manage. 00:00:18.000 --> 00:00:24.000 the PCAF standard development process, together with our core team, in line with our governance. 00:00:24.000 --> 00:00:34.000 Well, after more than 2 years of dedicated work and involving more than 100 industry experts, we are truly happy to present to you today our latest updates. 00:00:34.000 --> 00:00:38.000 We have a lot to cover today, so let's get started. 00:00:38.000 --> 00:00:43.000 I'm joined in this webinar with… by Hetal Patel, who is the PCAF core team chair. 00:00:43.000 --> 00:00:48.000 But also the sustainable investment and research lead at Phoenix Group. 00:00:48.000 --> 00:00:52.000 And in addition, Madalena Martins, she's with me, she is our 00:00:52.000 --> 00:01:08.000 Standard Development Coordinator. So, let's move to our agenda. First, Hetal will explain to you how we develop our standards in our standard development cycle, after which I will present a short overview of what's new in the current. 00:01:08.000 --> 00:01:14.000 updates. After this, Madelena will present to you the tools that PCAF provides to help the. 00:01:14.000 --> 00:01:24.000 implementation of these updates. And, uh, at the end, I will tell you a little bit more about what's next, and we can have some time for Q&A. 00:01:24.000 --> 00:01:29.000 Please already feel free to share your questions in the Q&A function in the meeting as we go. 00:01:29.000 --> 00:01:34.000 And note that we will not focus too much on the technical details today. 00:01:34.000 --> 00:01:42.000 But more on the general questions, because we will have dedicated deep-dive webinars in January for all of the individual methodologies. 00:01:42.000 --> 00:01:50.000 But now, without further ado, I will hand over to Hetal to present you the development process. 00:01:50.000 --> 00:01:56.000 Thank you, Caspar. And, uh, welcome, everybody. It's great to see so many of you at this 00:01:56.000 --> 00:02:05.000 launch webinar. I've had the great privilege of leading the core team, and those of you less familiar with 00:02:05.000 --> 00:02:14.000 the peak of governance. The core team is the body, uh, PCAP body that's responsible for governance and development of the BCAF standard. 00:02:14.000 --> 00:02:34.000 And we've had 14, and it's comprised of 14 members from financial institutions, which we've had representation across the different types of financial institutions across regions. So we've had at least, uh, one representative from each of the regions. And from our point of view, it's really important that we have. 00:02:34.000 --> 00:02:41.000 proper representation, so we can capture as we develop the new methods and guidance. 00:02:41.000 --> 00:02:53.000 the sectoral and the geographic nuances of those perspectives. And of course, it's not just the core team alone. We've been supported by. 00:02:53.000 --> 00:03:13.000 various, um, member signatory volunteers who have joined in, um, various working groups to… who have done the hard work in developing the new methods and guidance. And in total, it's been a mammoth effort. We've had, between the core team and the working groups, around 100 people inputting into this process. So it's a. 00:03:13.000 --> 00:03:19.000 huge effort, and I really would like to thank Core Team colleagues and all the volunteers in the working groups. 00:03:19.000 --> 00:03:26.000 Um, in terms of the actual what to develop, how to. 00:03:26.000 --> 00:03:44.000 develop it. The PCAF standard, really, we think of it as an evolving process, because you can't just come up with a method for every type of financial instrument all in one go. And so, we think of this as an ongoing process, and of course, we have to prioritize what we focus on. 00:03:44.000 --> 00:03:53.000 And so, in this cycle, we started by really surveying our membership to identify what are priority areas for them. 00:03:53.000 --> 00:04:01.000 And we've also looked to other regulatory developments, and we've looked to other industry initiatives as to what we thought was important. 00:04:01.000 --> 00:04:06.000 And that gave us a long list to start off with. And then the core team itself. 00:04:06.000 --> 00:04:19.000 It went through a prioritization process, looking at these factors, uh, you can see on your screen here, materiality, uh, impact, the ability to drive change, um. 00:04:19.000 --> 00:04:25.000 demand, um, from both the membership and industry, and then complexity of 00:04:25.000 --> 00:04:31.000 any particular topic, because of course, you want to be able to move forward, you don't want to. 00:04:31.000 --> 00:04:44.000 get bogged down on any one particular, um, issue. And so, through that process, we identified a short list of areas which we wanted to move forward. 00:04:44.000 --> 00:04:59.000 As a result of that, most of those updates, you actually now see in the updated, uh, published standard. But there's also been items where we deem slightly less important, but we have moved forward some of our thinking, and. 00:04:59.000 --> 00:05:08.000 some of those changes, for example, in embodied carbon, you'll see in further cycle developments. 00:05:08.000 --> 00:05:19.000 And it's been a whole… it's been a two-year process, and so we started off in 2023 standing up late 2023, standing up the core team. 00:05:19.000 --> 00:05:27.000 And going through that prioritization process, um, as we moved into 2024, we. 00:05:27.000 --> 00:05:34.000 we assembled these working groups. They did all the hard work in terms of developing these, uh. 00:05:34.000 --> 00:05:41.000 new methods and guidance, and by the end of the year, we were able to go out to the market for a consultation. 00:05:41.000 --> 00:05:56.000 which ran for a considerable period of time. And we actually had quite good feedback, um, or good participation, not just from signatory members, from the wider market, from other industry initiatives. 00:05:56.000 --> 00:06:01.000 And then, really, this year has been about taking on board that feedback. 00:06:01.000 --> 00:06:18.000 capturing some of those changes and incorporating it, and then, of course, then pulling it all together and publishing the latest standards, and we've come to this point which we're launching in December. So it's been a long process, but we're very pleased to have. 00:06:18.000 --> 00:06:30.000 move forward with what is a partee and a supplementary guidance to partee and an updated Part C. 00:06:30.000 --> 00:06:33.000 I think Caspar's now going to take us through what's, uh, within the standard. 00:06:33.000 --> 00:06:38.000 Over to you, Caspar. 00:06:38.000 --> 00:06:46.000 Yes. So… Let's look at what is new in all of our different standards. So, first of all, Part A, which is on finance deissions. 00:06:46.000 --> 00:06:51.000 Which introduces four new methodologies and also some additional guidance. 00:06:51.000 --> 00:07:03.000 on inventory fluctuations. So, uh, what is also important to mention that throughout the standard, we have updated it, none of the existing methodology has changed. 00:07:03.000 --> 00:07:09.000 But we have refined some of the text, included some additional clarifications. 00:07:09.000 --> 00:07:18.000 and also just made sure that references are up to date. But just to be assured, nothing has changed to the existing methodologies, but as Haytal said. 00:07:18.000 --> 00:07:27.000 Time over time, we are extending the standard to become more complete and includes all of the different financial products in the market. 00:07:27.000 --> 00:07:36.000 So, first of all, use of proceeds counting. Well, this methodology enables U.S. Financial institutions to account for specific greenhouse gas emissions from assets. 00:07:36.000 --> 00:07:39.000 That are financed by what we call use of proceed structures. 00:07:39.000 --> 00:07:45.000 think about equity or debt funds labeled or green bonds, special purpose vehicles, etc. 00:07:45.000 --> 00:07:56.000 And these assets can be projects, can be companies, or even assets like buildings, which are specifically ring-fenced and financed. And this is the methodology then allows you. 00:07:56.000 --> 00:08:02.000 in line with the greenhouse gas protocol methodologies as well, to account for those specific, um, uh. 00:08:02.000 --> 00:08:14.000 Uh, emissions. Then a sub-sovereign debt. This covers bonds and loans issued by regional or local governments. 00:08:14.000 --> 00:08:19.000 This methodology distinguish between sovereign-like issuers. which have a certain local jurisdictions. 00:08:19.000 --> 00:08:25.000 and more corporate-like issuers. that operate more like a company. 00:08:25.000 --> 00:08:31.000 For the first one, you can think about regions, states, and municipalities. 00:08:31.000 --> 00:08:39.000 And for the latter, you can think about local government agencies, for example, responsible for public services like waste and energy. 00:08:39.000 --> 00:08:47.000 Then, uh, securitizations are structured products. This methodology is quite complex, as it addresses emissions. 00:08:47.000 --> 00:08:52.000 From pools of loans or receivables. that are packaged and then resold to investors. 00:08:52.000 --> 00:08:58.000 think about covered bonds, collateralized debt, or mortgage-backed securities, but there's many more. 00:08:58.000 --> 00:09:06.000 And it uses a look-through approach that really follows the money and looks at the underlying assets, and then calculating the. 00:09:06.000 --> 00:09:15.000 asset of the emissions at asset level, and then attributing them to the investors based on their holdings in these vehicles. 00:09:15.000 --> 00:09:21.000 Um, for all of these methodologies, these three we will have more deep dive webinars in January, so I'll. 00:09:21.000 --> 00:09:32.000 I will leave it here, but let's spend a little bit more time on the own loans commitments, which is an additional piece of guidance that we have included in our reporting chapter. 00:09:32.000 --> 00:09:37.000 Uh, but we… because it's a relatively light touch, we won't have a deep dive webinar on this one. 00:09:37.000 --> 00:09:45.000 So this method was developed to align with the IFRS S2 reports and requirements that ask. 00:09:45.000 --> 00:09:51.000 financial institutions to report on the finance emissions. associated with undrone loans. 00:09:51.000 --> 00:10:02.000 Um… Now, on-run loans are actually not on the balance sheet, so that's why the PCAF standard originally didn't include it, but given the fact that IFRS asked for it and are. 00:10:02.000 --> 00:10:05.000 membership has also asked PCAF to develop a methodology. 00:10:05.000 --> 00:10:11.000 We did so, uh, but it's not required, it's an optional reporting metric. 00:10:11.000 --> 00:10:19.000 So, uh, um, emissions are attributed just like other corporate finance methodologies, by the share of the undrawn loan amount. 00:10:19.000 --> 00:10:28.000 That is not, uh, actually, uh, drawn. And then over the total enterprise value, or equity and depth of the borrower. 00:10:28.000 --> 00:10:36.000 Uh, based on consultation feedback, we included a more specific definition, but we also realized that every financial institution might. 00:10:36.000 --> 00:10:42.000 Um, have their own definition, or maybe even doesn't align with IFRS. 00:10:42.000 --> 00:10:49.000 So, we do allow financial institutions to slightly deviate from that definition as long as they clearly explain how and why. 00:10:49.000 --> 00:10:56.000 And in addition, we got some feedback through the consultation that reporters feel that 100%. 00:10:56.000 --> 00:11:01.000 on their own commitments would overstate the actual responsibility, because. 00:11:01.000 --> 00:11:06.000 over the year, typically a much smaller amount is actually used. 00:11:06.000 --> 00:11:12.000 by their clients. However, for simplicity and also comparability, we have. 00:11:12.000 --> 00:11:29.000 continue to require 100% on drone. reporting, but, um… It does allow financial institutions to apply a weighting if they want to do so, but then they should do that on top and clearly explain and disclose the percentage used. 00:11:29.000 --> 00:11:34.000 We realized that this percentage can highly differ per market and per region. 00:11:34.000 --> 00:11:39.000 Uh, so we didn't feel it was appropriate to pick a percentage here. 00:11:39.000 --> 00:11:53.000 And then finally, inventory fluctuation. This is, uh… is an important metric of important guidance that we have added to the standard, because we realize that finance emissions and absolute number. 00:11:53.000 --> 00:11:59.000 uh… fluctuates over the years. Sometimes for very good reasons, but sometimes also due to. 00:11:59.000 --> 00:12:05.000 Um, changes in… that are not reflecting actual changes either in the portfolio. 00:12:05.000 --> 00:12:14.000 Where in the real economy, think about inflation, think about, uh, big, uh, changes in market capitalization, etc. 00:12:14.000 --> 00:12:23.000 Uh, so we put out a… consultation paper, and asked for feedback, and we noticed that the clear majority was, uh. 00:12:23.000 --> 00:12:28.000 Preferred, um… To ask for further. 00:12:28.000 --> 00:12:34.000 fluctuation analysis, so showing the drivers behind significant year-on-year changes. 00:12:34.000 --> 00:12:39.000 over applying a normalization or dampening approach, because in the end, those. 00:12:39.000 --> 00:12:47.000 Approaches, kept similar issues, and also there wasn't a clear preference for one methodology. 00:12:47.000 --> 00:12:52.000 So this is what's, uh, PCAF did. So in our new standard, we highly recommend. 00:12:52.000 --> 00:12:57.000 Uh, providing such a fluctuation analysis, at least in a narrative form. 00:12:57.000 --> 00:13:01.000 But we know that the market has already developed several more. 00:13:01.000 --> 00:13:10.000 Quantitative, uh, um… Measures as well. We don't include and require one of them, but over time, we do think that. 00:13:10.000 --> 00:13:15.000 Uh, that we can provide additional examples of best practice here. 00:13:15.000 --> 00:13:26.000 And then finally, the standard also includes a small, um… Uh, an additional recommendation on to also adjust emission factors, especially economic ones. 00:13:26.000 --> 00:13:39.000 For inflation. So, this is all of the new additions to Part A, and let's now move to, uh… Our new supplemental guidance on finance avoided emissions and forward-looking metrics. 00:13:39.000 --> 00:13:50.000 So, these are metrics that are clearly outside of the inventory, and are also optional for reporting. And actually, if you would report on them, it's required to do that separately. 00:13:50.000 --> 00:13:56.000 But the guidance was really designed to first enhance transparency, but also. 00:13:56.000 --> 00:14:07.000 align, uh, with market demand and sustainability frameworks. So there's a lot of, uh… there was a lot of questions about these metrics, and PCAF has evaluated and decided, okay, we do want to. 00:14:07.000 --> 00:14:12.000 provide additional guidance to ensure harmonization and to put some clear guardrails in place. 00:14:12.000 --> 00:14:17.000 But don't mandate reporting on these. So finest avoided emissions. 00:14:17.000 --> 00:14:22.000 uh, is a methodology. that, uh, estimates or. 00:14:22.000 --> 00:14:31.000 provides guidance and guardrails to report. Uh, emissions that are voided as a result of activities that. 00:14:31.000 --> 00:14:36.000 companies or other projects in your… in the portfolios of financial institutions. 00:14:36.000 --> 00:14:41.000 can achieve, and then you, as a financial institution. 00:14:41.000 --> 00:14:48.000 can report associated finance devoid of emissions through your investment in these entities. 00:14:48.000 --> 00:15:01.000 Um, again, PCAF puts in some guardrails, for example, requiring reporting based on physical data, not economic data, using credible methodologies, and disclosing them. 00:15:01.000 --> 00:15:12.000 And also implementing clear data quality assurance process. Similarly, for forward-looking metrics, these are developed to align with emerging frameworks, like the ones from GFENS. 00:15:12.000 --> 00:15:17.000 And it includes two metrics that we propose. One is expected emission reductions, really. 00:15:17.000 --> 00:15:27.000 Looking at the missions that are. actually reduced over time, and also another metric, which is a forward-looking way of looking at avoided emissions. 00:15:27.000 --> 00:15:32.000 So, how are the avoided emissions over the next 10, 20 years? 00:15:32.000 --> 00:15:43.000 expected to materialize themselves. Again. Uh, and both of these metrics, we put some clear guardrails in place to ensure credibility. 00:15:43.000 --> 00:15:50.000 Then finally, uh, our Part C, which is on insurance and insurance-associated admissions. 00:15:50.000 --> 00:15:56.000 Here, we also did some updates throughout, just to improve readability. 00:15:56.000 --> 00:15:59.000 But also, we included two new methodologies. One is on project insurance. 00:15:59.000 --> 00:16:06.000 Which, uh, applies to insurance products that are covering the construction and engineering phase of new projects. 00:16:06.000 --> 00:16:15.000 And this guides how to account for greenhouse gas emissions. First of all, of the construction phase, and optionally also from the use phase of these projects. 00:16:15.000 --> 00:16:22.000 And finally, a treaty reinsurance, which is a big market for the insurance sector, but it actually looks at. 00:16:22.000 --> 00:16:32.000 Um… reinsure is covering the portfolio of risk from primary insurance, or for all of the other insurance categories that we already included. 00:16:32.000 --> 00:16:36.000 So this is really about reinsurance. Uh, of those risks. 00:16:36.000 --> 00:16:43.000 With that, we reached the end of the updates for now. 00:16:43.000 --> 00:16:49.000 And we move over to how to implement these, and I hand over here to Marlena. 00:16:49.000 --> 00:16:55.000 Thank you, Caspar, um, and hello, good morning, or good afternoon to everyone as well. 00:16:55.000 --> 00:17:01.000 Um, so I just want to mention a bit about also what we are working on besides the launch of the standard. 00:17:01.000 --> 00:17:14.000 What else can you expect? You know, implementation? And to start off, um, Caspar mentioned at the start of the meeting, but we are hosting technical webinars for these new methods and guidance that we've published. 00:17:14.000 --> 00:17:19.000 Um, we don't have the final dates yet, but you can see we're gonna have 3 webinars. 00:17:19.000 --> 00:17:23.000 Each one will cover two of these new methods that we're covering today. 00:17:23.000 --> 00:17:29.000 Um, and these will be held in January. Um, so we ask you, you know. 00:17:29.000 --> 00:17:34.000 We will publish it on LinkedIn and on our website once we have the registration links. 00:17:34.000 --> 00:17:44.000 But just know we will have an opportunity to have the people that actually developed these methods together with us, explaining you more of the technical part. 00:17:44.000 --> 00:17:49.000 Um, explaining the methodology. Um, so all of your questions that you have. 00:17:49.000 --> 00:17:52.000 More on the technical side of what we've spoken today. 00:17:52.000 --> 00:17:59.000 You can save them for these webinars. Um, and then we can really take the time to answer all of the questions. 00:17:59.000 --> 00:18:10.000 Um, another thing that we get asked quite a bit is, you know, when should a financial institution start applying these methods? When is it required for them to report on this? 00:18:10.000 --> 00:18:16.000 Um, and as I speak up, we decided not to set a timeline or. 00:18:16.000 --> 00:18:22.000 you know, a time frame that we require from the signatories and financial institutions to disclose. 00:18:22.000 --> 00:18:27.000 Um, you know, we aim for practicality and gradual adoption, also taking into account. 00:18:27.000 --> 00:18:33.000 That data availability varies across regions, across asset classes. 00:18:33.000 --> 00:18:40.000 So what we say is you should start as soon as feasible, right? So, looking at if it's relevant at the high-impact areas. 00:18:40.000 --> 00:18:44.000 of your portfolios, you know, looking at the data available. 00:18:44.000 --> 00:18:49.000 you can start, um, calculating, understanding the methodologies, and disclosing. 00:18:49.000 --> 00:18:56.000 Um, and then while there is no fixed deadline, we ask all of the institutions to transparently disclose. 00:18:56.000 --> 00:19:00.000 which portfolio segments are covered, and explain any exclusions. 00:19:00.000 --> 00:19:07.000 So, you can choose when you start reporting, but always be transparent about what you're covering and what you're not covering with. 00:19:07.000 --> 00:19:20.000 these new methodologies. Um, then we also offer a range of resources to help our signatories understand these methodologies, how to apply them, etc. Um, and we are working to update these as well. 00:19:20.000 --> 00:19:28.000 And that takes me to the next slide. Um, so a lot of the PCAF inventories might be familiar with all of these resources that we have. 00:19:28.000 --> 00:19:32.000 Um, PCAF is not just a methodology, we try to do quite a lot. 00:19:32.000 --> 00:19:36.000 Um, to support our signatories with getting to the reporting phase. 00:19:36.000 --> 00:19:44.000 Um, and I just want to talk through a bit how we're updating, what we are doing behind the scenes as well, and what you can expect. 00:19:44.000 --> 00:19:49.000 So we have a PCAF Academy. This is an e-learning platform, self-paced. 00:19:49.000 --> 00:19:56.000 with, uh, videos, learning content, some practice questions, a final exam. 00:19:56.000 --> 00:20:01.000 Um, and we are working to add all of these new methodologies and guidance to our PCAF Academy. 00:20:01.000 --> 00:20:09.000 So soon you'll be able to, in a more practical way, learn about the methodologies, and get you a bit closer to that disclosure step. 00:20:09.000 --> 00:20:16.000 We obviously have a technical assistance team. They're ready also to provide you direct support. 00:20:16.000 --> 00:20:20.000 Um, any questions that you might have about these new methodologies? 00:20:20.000 --> 00:20:25.000 how to apply them, we have a team dedicated to answering these questions. 00:20:25.000 --> 00:20:29.000 Um, and then we have an emission factor database. 00:20:29.000 --> 00:20:35.000 knowing that data tends to be quite an important part about your disclosure. 00:20:35.000 --> 00:20:44.000 Um, our database team is also looking at these new methods, um, how could we update the database throughout the next year and next years. 00:20:44.000 --> 00:20:51.000 Um, to add emission factors that will support, then, our signatories also in calculating and disclosing. 00:20:51.000 --> 00:21:03.000 The emissions of these new methodologies. Um, and then finally, there's some additional resources we are working, um, to publish. These will be public, um, but we thought would be important. 00:21:03.000 --> 00:21:09.000 As we release new standards. And there's two documents we want to publish in the next weeks. 00:21:09.000 --> 00:21:18.000 Um, first is a document that will describe. what has been changed and what has been updated in the standard, so not looking at these new methodologies, but that the. 00:21:18.000 --> 00:21:22.000 Um, other versions of Part A and Part C. 00:21:22.000 --> 00:21:27.000 Um, what has been changed, what new additions did we have, like Asper mentioned. 00:21:27.000 --> 00:21:32.000 No methodological changes happen, but. We added some clarifications here and there, based on. 00:21:32.000 --> 00:21:36.000 a lot of questions that we get, things that we thought could be updated. 00:21:36.000 --> 00:21:42.000 Um, and then also a consultation summary document, which will highlight the key themes. 00:21:42.000 --> 00:21:50.000 So we had the public consultation, and we want to publish also a document, um… basically explaining what the consultation feedback was. 00:21:50.000 --> 00:21:54.000 Um, just in a summarized way, what we received. 00:21:54.000 --> 00:22:00.000 Um, so these are a bit all of the things that you can expect as well in the next few weeks, in 2026. 00:22:00.000 --> 00:22:07.000 Um, and with that, I will also hand over to Caspar, who can explain you a bit about what's next. 00:22:07.000 --> 00:22:17.000 Thank you. So, yes, what's next? And then we move to Q&A. I already see quite some questions coming in, and some of them we've even already answered. 00:22:17.000 --> 00:22:23.000 Um, so… Yeah, as we're closing this cycle now. 00:22:23.000 --> 00:22:27.000 We, of course, haven't finished, and there's still work to be done. 00:22:27.000 --> 00:22:33.000 Um, so first of all, we, uh, in the coming period, we will, um. 00:22:33.000 --> 00:22:36.000 stand up a new core team, which means it's a mix. 00:22:36.000 --> 00:22:39.000 of existing members, but also maybe some new members. 00:22:39.000 --> 00:22:46.000 We have had an application process within our signatory base, and we make sure that we have a new and fresh core team. 00:22:46.000 --> 00:22:49.000 with the right expertise ready for the next cycle. 00:22:49.000 --> 00:23:00.000 Um, after that, we… this group will also, based on input that we had before, and that we still get… are receiving, identifying new areas of focus for standard development. 00:23:00.000 --> 00:23:05.000 Uh, and then we will set up new working groups to develop these methodologies. 00:23:05.000 --> 00:23:13.000 I already saw some crashes in the chat on what we're going to cover, and yeah, this is still to be determined, but what I already do know, and that was one of the questions, actually. 00:23:13.000 --> 00:23:21.000 If there will be updates to Part B, so a facilitated emissions of issuing financial instruments. 00:23:21.000 --> 00:23:30.000 that I can already, uh, say yes on, because all of the new methodologies that we've just added to Part A, of course, can also be issued. 00:23:30.000 --> 00:23:33.000 So, it's clear that these should be added to Part B as well. 00:23:33.000 --> 00:23:37.000 And in addition to that, we have also some exploratory work. 00:23:37.000 --> 00:23:43.000 ongoing, for example, on embedded carbon, as well as on insurance claims. 00:23:43.000 --> 00:23:53.000 And it's also, uh… makes a lot of sense to transition that into official working groups, or at least to include that in the standard. 00:23:53.000 --> 00:24:05.000 Uh, and then, uh, somewhere in the course of next year, hopefully relatively early next year, we will then start this new development process, eventually leading to public consultation on these methodologies. 00:24:05.000 --> 00:24:09.000 And then another update webinar, like we have today. 00:24:09.000 --> 00:24:18.000 Um, you can find all of the relevant content, including our governance process on our website 00:24:18.000 --> 00:24:26.000 And you can always reach out to us through info at carbonaccountingfinancials.com. I also saw a question, how to become a signatory? 00:24:26.000 --> 00:24:35.000 But please reach out to us through that email address, or look up for the right regional lead, and they're also listed on your website for all of the regions. We have individual region. 00:24:35.000 --> 00:24:41.000 leads that know your region best. And they can tell you all about how to join PCAF. 00:24:41.000 --> 00:24:52.000 So now let's move to some. Q&A, um… Madelena, maybe you… you can share relevant questions, and then see who's best to answer. 00:24:52.000 --> 00:25:05.000 Um, yes. Um, so, let me see… Uh, I see some more technical questions… Um, maybe an interesting one? 00:25:05.000 --> 00:25:11.000 Um, has there been any changes made on the incorporation of Scope 3 emissions for all sectors? 00:25:11.000 --> 00:25:16.000 Has there been an update to the EVEQs for the attribution factor? 00:25:16.000 --> 00:25:22.000 Yeah, so it's a really good question. Uh, among the general updates that I mentioned in the standard. 00:25:22.000 --> 00:25:29.000 We have cleaned up some of the text on the Scope 3 phase-in, because by now, the Scope 3 phasing period that we had. 00:25:29.000 --> 00:25:36.000 for corporate finance to gradually, over time, phase in the requirements to report Scope 3. 00:25:36.000 --> 00:25:40.000 of Scope 3, so this… in this case, Scope 3 of the companies. 00:25:40.000 --> 00:25:47.000 That's a financial institution would be investing in. reported all of them together under Scope 3, Category 15, which is. 00:25:47.000 --> 00:25:52.000 Uh, it's about finance missions. By now, that phasing period has, uh. 00:25:52.000 --> 00:25:59.000 has been completed, so in practice, Scope 3 would be required for all sectors, and we have. 00:25:59.000 --> 00:26:04.000 cleaned up that text, make sure that it's crystal clear that this is required for all sectors. 00:26:04.000 --> 00:26:10.000 But we still refer to, in the textbooks, to the old phasing period, just for transparency. 00:26:10.000 --> 00:26:19.000 So, yes. Uh, and the EVIC is still the attribution factor for listed companies, so that hasn't changed. 00:26:19.000 --> 00:26:25.000 Great, um… Then, I see another question that asks. 00:26:25.000 --> 00:26:31.000 That use of precedes accounting seems pretty similar to the project finance structures. 00:26:31.000 --> 00:26:36.000 Um, maybe you can explain a bit the difference and why we have these two methods. 00:26:36.000 --> 00:26:50.000 Yeah, let me also take this one. So, project finance is still there, uh… Uh, in terms of… I also saw a question on avoided emissions. So, we've taken out the voided emissions part, which was only focusing on renewable energy projects. 00:26:50.000 --> 00:26:58.000 there to incorporate under the finest avoided admissions guidance, which is broader and also cleaner, because the standard is then really about. 00:26:58.000 --> 00:27:05.000 Scope 3 accounting according to the greenhouse Gas Protocol, looking at generated emissions, whereas this guidance document is done. 00:27:05.000 --> 00:27:13.000 Focusing on the outside of the inventory metrics. And, um… And then the use of proceeds. 00:27:13.000 --> 00:27:16.000 in a way, you could argue that project finance is one. 00:27:16.000 --> 00:27:22.000 type of use of proceeds, but use of proceeds goes further, I mean, it's broader, and also looks. 00:27:22.000 --> 00:27:25.000 at individual vehicles, so then you're typically investing through a specific vehicle. 00:27:25.000 --> 00:27:31.000 Whereas project finance can be more direct. But you're right, in theory, the methodology. 00:27:31.000 --> 00:27:38.000 Actually, quite similar. But for use of Procichi, you have this double attribution, where you first look at. 00:27:38.000 --> 00:27:49.000 how to attribute emissions. Uh, of what you're investing in into the vehicle, and then also then what share of the vehicle do you own as a financial institution? 00:27:49.000 --> 00:27:56.000 Um, perfect. I also see a few questions on if the technical webinars will be public. 00:27:56.000 --> 00:28:07.000 Those are open to everyone, um, not just signatories, so you… Even if you're not a PCAF signatory, don't worry, you can join our technical webinars, and we will also share the recording of this one. 00:28:07.000 --> 00:28:15.000 It will be up on our website. Um, then another question that I saw that I thought interesting. 00:28:15.000 --> 00:28:22.000 Um, will there be any additional guidance document published on inventory fluctuations discussion paper? 00:28:22.000 --> 00:28:29.000 Or to speak of expected signatories to take the discussion paper as a guide together with the new standard? 00:28:29.000 --> 00:28:46.000 Um, so at this point, this is, um, the guidance is, um, what's out there at the moment, but of course, um, as we develop the next cycle, if we feel as part of the feedback in the survey process, that more is required at this stage. 00:28:46.000 --> 00:28:56.000 we could always, um, uh, stand up a working group and possibly put together an offline, uh, discussion paper. 00:28:56.000 --> 00:29:06.000 that there's also a question I saw on derivatives, um, whether there'll be a methodological development for physical and, uh. 00:29:06.000 --> 00:29:22.000 Physical derivatives trading. Um, I should call this one out. We'll go through, as part of the new court team, you'll go through another prioritization process, and one of the issues that what did come up in the last cycle with regards to derivatives is. 00:29:22.000 --> 00:29:30.000 There's a question mark on impact in terms of, you know, to what extent does the follow the money principle apply to derivatives? And so. 00:29:30.000 --> 00:29:43.000 whilst I'm very aware that derivatives are a very large market and very significant to certain types of financial institutions, um, we do filter it through that sort of lens, through that prioritization process. So. 00:29:43.000 --> 00:29:50.000 we'll have to see as part of the next cycle. 00:29:50.000 --> 00:30:00.000 Alright, I see that we're actually at time, so let's… let me address maybe one more question, and then… We close off, but noting that all of your detailed questions can be, uh. 00:30:00.000 --> 00:30:06.000 answered, uh, over email. Uh, and also in the deep dive webinar on the different methodologies. 00:30:06.000 --> 00:30:11.000 Uh, did there… was there one, uh, final one, Madalena, that stood out for you? 00:30:11.000 --> 00:30:22.000 Um, yeah, I saw maybe First Sovereigns. If we've done an assessment of how many local governments already publish Scope 1 and Scope 3 data. 00:30:22.000 --> 00:30:29.000 Yeah, that's a good one. So, the answer is yes, and the answer is also that this data is still very limited. 00:30:29.000 --> 00:30:33.000 for larger municipalities, we do see it, and we also see. 00:30:33.000 --> 00:30:42.000 Um, uh, this is emerging, but even that… the different methodologies are used, but for us, that wasn't necessarily a reason to not cover this now. 00:30:42.000 --> 00:30:54.000 Uh, Scope 1 emissions are typically available. And it's a bit of the chicken and egg situation, so we feel that by bringing out this methodology, investors will start asking for this type of data, and then hopefully this data. 00:30:54.000 --> 00:31:00.000 will become more available over time as we go forward. 00:31:00.000 --> 00:31:07.000 So, with that, I really want to thank you all for showing up with so many, and your interest in PCAF. We're here to help. 00:31:07.000 --> 00:31:16.000 Uh, so let us know your questions, and… Hopefully we'll see each other in the future.