As the first bank in Vietnam to participate in the Carbon Accounting Financials Partnership (PCAF), BIDV has created an important milestone on the journey to improve greenhouse gas emission management capacity, promote financial transformation and realize sustainable development strategies.
The role of measuring "financial emissions
In the context of climate change increasingly causing heavy damage and widespread impact on the economy, reducing greenhouse gas emissions has become an inevitable trend globally. For the banking industry, most of the emissions do not come from direct operations but indirectly through financial activities (financial emissions).
According to a report by the World Resources Institute, financial emissions account for nearly 100% of the bank's total emissions. Therefore, to build a substantial emission reduction roadmap and effectively implement a sustainable development strategy, measuring financial emissions is a prerequisite. However, this is also a field with many challenges due to the lack of input data and the ability to implement on a credit portfolio scale.
Faced with that requirement, PCAF's birth is considered an initiative that plays an important role in the global climate finance ecosystem. Established in 2015, PCAF is currently an alliance of more than 750 financial institutions globally, developing and applying a unified method in emission quantification for the financial industry.
To date, PCAF is the first and only organization to issue Financial Emission Metrology and Announcement Standards in a harmonious, transparent and comparable manner. PCAF's standards are currently used by many financial institutions around the world to quantify emission levels, determine base emissions and support the disclosure of information related to climate.
New step forward of BIDV in promoting sustainable development
Signing a commitment to participate in PCAF opens up for BIDV the opportunity to access more deeply international methodologies and many resources to support implementation in practice.
Through this network, BIDV can use emission coefficients built and updated periodically according to many countries and economic sectors; thereby supporting the expansion of emission calculation capabilities on a portfolio scale. At the same time, PCAF provides a standardized framework for evaluating data quality, contributing to improving consistency, accountability and reliability of measurement results.
In addition, BIDV has conditions to improve professional capacity through the PCAF Academy online training platform, technical support activities and a network connecting PCAF members and partners in the region and globally.
Based on exploiting the methodology and resources from PCAF, BIDV will gradually complete the data platform and financial emission measurement system, as a basis for building an emission reduction roadmap suitable to the listing characteristics and development orientation of the bank. At the same time, BIDV continues to strengthen risk management capacity, promote the provision of green financial products and services, transformational finance, accompanying customers in the journey to transition to a sustainable growth model.
Joining PCAF also affirms BIDV's commitment to creating sustainable value for customers, shareholders and the social community; and actively contributes to the green development goal and realizes Vietnam's commitment to net zero emissions.
