Credit Portfolio Alignment: An application of the PACTA methodology by Katowice Banks in partnership with 2DII

At the 2018 COP24 in Katowice, five international banks - BBVA, BNP Paribas, ING, Société Générale and Standard Chartered - publicly pledged to develop an open-source methodology to progressively steer (or ‘align’) their lending portfolios with the goals of the Paris Agreement.

Since 2018, in addition to undertaking individual efforts, the Katowice Banks as a group has worked collectively with the 2° Investing Initiative (2DII), which has developed an approach to measure the alignment of lending portfolios with climate scenarios. This approach, the Paris Alignment Capital Transition Assessment (PACTA) for corporate lending portfolios, takes the form of a methodology and an open-source tool which can be applied by any interested bank. Close to twenty “systemically important” banks have taken part in this pilot and the ambition is to expand this coalition further. This document provides an overview of the application of the PACTA methodology and the options viewed as most useful by the Katowice Banks.

2DII today announced it is transferring stewardship of the Paris Agreement Capital Transition Assessment (PACTA) to RMI, formerly Rocky Mountain Institute. PACTA measures financial portfolios' alignment with various climate scenarios, including those consistent with the Paris Agreement. Under RMI’s stewardship, PACTA will remain a free, independent, open-source methodology and tool, and will continue to provide the financial and supervisory community with forward-looking, science-based scenario analysis to help users make climate-aligned financing decisions. RMI will invest in scaling up PACTA’s usability and applicability in day-to-day investment decisions as well as reporting requirements.

Access the full press release here: the coming weeks, we will update this website with additional information. For now, please note that all contact information remains unchanged.