Portfolio Decarbonization Coalition

The Portfolio Decarbonization Coalition (PDC) was a multi-stakeholder initiative launched in 2015 prior to COP21 by Amundi, AP4, CDP and UNEP FI, the latter also hosting the initiative’s secretariat. It aimed to drive GHG emissions reductions by mobilizing institutional investors committed to gradually decarbonizing their portfolios. In 2017, it convened 32 investors overseeing the decarbonization of $800bn in commitments. It supported the PRI Montreal Pledge, which has reached more than $10 trillion in assets under management with over 120 investors committed to measure and publicly disclose the carbon footprint of their investment portfolios on an annual basis

Why it matters

PDC played a key role in the run up to COP21 highlighting the need to decarbonize portfolios – marking the beginnings of financial institutions’ “alignment” commitments.

Decarbonization can be achieved by withdrawing capital from particularly carbon-intensive companies, projects, and technologies in each sector and by re-investing that capital into particularly carbon-efficient companies, projects, and technologies of the same sector. The Portfolio Decarbonization Coalition played a role in socializing the idea that having institutional investors owning large segments of the global economy taking action to decarbonize their portfolios would send a strong and unequivocal signal to companies and policy makers that a transition toward a low-carbon economy is needed and will incentivize companies to re-channel investments to low-carbon activities.

Main areas of work related to climate mainstreaming:

The Portfolio Decarbonization Coalition pursued the following work streams:

• Communication and outreach campaigns to secure investor commitments
• Undertake research and analysis to resolve emerging questions, both procedural / technical as well as fundamental
• Provide orientation services on how to fulfil commitments