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The CO2 emissions of your investments

The CO2 emissions of your investments

A company’s CO2 emissions are an indicator for monitoring sustainability performance. It helps to calculate those emissions and to compare them against a benchmark. With this we can put the CO2 emissions of a company into perspective, or measure whether a certain target is being achieved. Here we explain how the calculation of the emissions of companies in your investment portfolio works.

The CO2 emissions of your portfolio

To find out what the greenhouse gas emissions of companies are, we work together with our data supplier, ISS Oekom. They conduct research into the emissions per company. Those emissions are difficult to determine. There are direct emissions, caused by own sources, but also indirect emissions caused by, for example, purchased energy. 

ISS Oekom makes a calculation in which the total CO2 emissions of a company are expressed as the sum of the so-called ‘Scope 1’ (direct) emissions and ‘Scope 2’ (indirect) emissions. 

In your report, you will see the following infographic with different figures:

The CO2 emissions of your investments: infographic

What exactly does it say here? 

For your portfolio, the tCO2e (see what exactly CO2 is ) of all companies is added up and settled in order to be compared with the benchmark. In the attached example you can see: 

  1. The weighted average CO2e emission of the equity portion of the portfolio (or the asset class ‘equities’). 
  2. The tCO2e of the agreed benchmark. 

The difference in emissions between the portfolio and the benchmark in this example is 63. The lower the score stays below the benchmark, the better.

Expressed in flights from Amsterdam to New York

We will convert the 162 tCO2e in the example above into the non-emitted CO2 in terms of the number of return flights Amsterdam - New York. We want to use this comparison to give you more insight. The 162 tCO2e equals 37 return flights. 

We make that calculation with the help of the independent website CO2 Emission Factors.


What exactly is CO2?

We often talk about CO2, but what exactly is it? CO2 (carbon dioxide) is a greenhouse gas naturally present in the Earth’s atmosphere. Like other greenhouse gases, CO2 ensures that the heat from the sun is retained. CO2 emissions occur through the combustion of fossil fuels, such as oil, coal and natural gas. Animals and humans also emit CO2.

If CO2 emissions are too high, the Earth heats up faster. Some of the CO2 emissions are absorbed by trees, plants and plankton in the sea. These organisms convert CO2 into oxygen (O2). This absorption is currently not enough to combat global warming.

Incidentally, CO2 is not the only greenhouse gas that has a harmful effect. Since the impact of different greenhouse gases varies, all emissions are converted into CO2 equivalents per year. This is expressed in tCO2e.

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Want to invest your money sustainably?

Interested in sustainable investing? For the ESG Fund Mandate, our asset managers select investments that stand out for their sustainability and their financial returns.

Investing entails risks

Investing entails risks. You could lose (some of) the money you invested. If you are going to invest, it is important that you are aware of this. Invest with money you can spare. Keep a buffer for unforeseen circumstances.