2026 Financed Emissions Benchmark Report
Year-end 2025 disclosures
Now in its fifth iteration, PwC’s Financed Emissions Benchmark reviews sustainability disclosures from 57 financial institutions across banking, life insurance and asset managers. The benchmark assesses how institutions measure, govern and use financed emissions, with a focus on sustainable finance, target basis and credibility, restatements, assurance, scope and coverage, data quality and methodology
The analysis is complemented by CDP 2025 data1, providing a broader reference point for assessing financed emissions and wider sustainability disclosures. It is also supported by PwC’s GHG Emissions Analyser, which provides the detailed benchmark data and peer views behind this report. The benchmark is based on public disclosures, so findings reflect disclosed practice rather than every activity that may be taking place internally.
Why it matters
Despite geopolitical uncertainty and shifting policy priorities, climate remains a key focus area for financial institutions. CDP 2025 data shows that 82% of institutions measured the climate impact of their portfolio and, of those, 91% used financed emissions. Where institutions are not yet measuring portfolio impact, most cite practical barriers such as data availability, methodology, resources and standardisation - not a lack of relevance.
This year’s analysis of 2025 disclosures provides timely insight into how the market is moving from financed emissions measurement towards credibility, comparability and action. As baselines mature, stakeholders increasingly expect institutions to explain not only what they have measured, but how the results are governed, how uncertainty is managed, and how insights are used in decision-making.
Sustainable finance is becoming part of the same conversation: financed emissions show where climate impact and transition exposure sit across portfolios, while sustainable finance shows how institutions are responding through capital allocation, client engagement, product strategy and transition-related financing.
Two forces are raising the bar
Mandated reporting is moving financed emissions from voluntary disclosure to structured accountability. ISSB-aligned and jurisdictional requirements are increasing expectations for emissions data that is comparable, transparent, traceable and decision-useful.
Supervisory expectations are increasing scrutiny of how climate and sustainability risks are governed, measured, monitored and embedded into risk management.
For financed emissions, this means the numbers need to be traceable for disclosure, robust enough for assurance, and actionable for risk management, capital allocation, client engagement and transition planning.
This paper focuses on what now differentiates leading institutions: credible targets, transparent restatements, stronger data governance, clearer scope and coverage, and better links between emissions metrics, sustainable finance and transition action.
1) The Financed Emission Benchmark analysis is complemented by the CDP 2025 Climate Change Corporate Response Dataset, used by PwC in aggregated / derived form as a broader market reference point for financed emissions and wider sustainability disclosures. Source: CDP; PwC analysis. No raw CDP responses or company-level CDP data are reproduced.
Executive dashboard:
from measurement to management
Financed emissions are moving from disclosure metric to management tool — helping institutions steer capital, evidence transition readiness and explain progress under scrutiny.
Our financed emissions benchmark in numbers
State of the market
Financed emissions measurement has advanced over the years but there is still more to do. PCAF has helped create a common language across core portfolios, but gaps remain across parts of the balance sheet, value chain and data foundation. Banks now need financed emissions data that can be explained under scrutiny and used in decisions — from target tracking and client engagement to risk appetite, sustainable finance, portfolio steering and capital allocation.
What we see as good practice
Our benchmark shows examples of stronger practice across different institutions, rather than a single group consistently leading across all areas. Stronger disclosures explain how financed emissions numbers are governed, why they change, and how they inform targets, risk appetite, client engagement, sustainable finance and capital allocation.
Where market practice still needs to mature
Market practice is improving, but reporting is still hard to compare where boundaries, assumptions and controls are unclear. The main gaps are inconsistent sustainable finance classification, incomplete coverage across assets, sectors and value chains, limited visibility over data sources and estimates, and insufficient explanation of target assumptions or methodology changes.
Executive Summary:
What management should be asking?
As financed emissions reporting matures, the focus is shifting from calculation to confidence and action. For management teams, this means understanding what sits behind the numbers, how changes are governed, and how emissions insights are being used to shape risk, client engagement, sustainable finance and capital allocation
This year’s findings point to four questions management should be asking.
Sustainable finance
What we are seeing: Sustainable finance commitments are increasingly visible, but definitions, classification and target coverage remain inconsistent.
What does this mean for you: Make clear what qualifies as sustainable finance, who governs it, and how it links to client transition, product strategy and capital allocation.
Target basis and credibility
What we are seeing: Targets are being disclosed, but pathway choices, progress tracking and treatment of resets vary.
What does this mean for you: Management needs to be able to explain what each target covers, why the pathway was chosen, how progress is tracked, and how changes are approved and communicated.
Scope and coverage
What we are seeing: Coverage is expanding across core portfolios, but gaps remain across assets, sectors, value chains and Scope 3.
What does this mean for you: What is included, what is excluded, why exclusions remain, and how material gaps will be addressed over time.
Data and methodology
What we are seeing: PCAF has created a common language, but data sources, proxies, lags and data quality still differ.
What does this mean for you: Who owns the data, what checks are in place, where estimates are used, and how ready the process is for assurance.
A view from the market
I am pleased to share the latest PwC Financed Emissions Benchmark at an important point in the market’s evolution. The conversation is moving beyond whether financial institutions can calculate financed emissions, towards whether those numbers are credible, controlled and useful in the decisions that matter.
Sustainability reporting requirements are increasing expectations for comparable, traceable and decision-useful emissions data. At the same time, supervisory and risk management expectations are sharpening the focus on governance, scope, assumptions, controls and management action.
The strategic and commercial implications are becoming clearer. Financed emissions can help institutions understand portfolio exposure, support sustainable finance decisions, inform client engagement and evidence transition readiness. As sustainability becomes more closely linked to capital allocation, resilience and growth, the quality of emissions data becomes a management issue, not just a reporting issue.
The direction of travel is clear. Market leadership is likely to be defined by the ability to move financed emissions from a reporting metric to a management capability - connecting credible targets, transparent scope, stronger data governance and sustainable finance activity into a coherent story for reporting, risk, strategy and commercial decision-making. For many institutions, this remains an evolving journey rather than a finished state.
Stewart Cummins
01. Sustainable Finance
1.1 Current Landscape: Disclosures and capital allocation
Sustainable finance is where transition ambition starts to translate into capital allocation. Commitments and targets are increasingly visible, but assessing delivery depends on whether institutions consistently define, classify and report the financing and investment activity that supports them. CDP responses suggest disclosure gaps are more operational than intentional, with over 63% of non-disclosure reasons linked to capability, process, data or taxonomy barriers.
Sustainable finance disclosure data is limited for LI & AM. Hence much of this section focuses solely on the Banks population.
Banks
Taxonomy fragmentation limits comparability
While firms may use taxonomies, standards or methodologies to classify sustainable products and services, the specific basis is often not visible in public disclosures. Where classification approaches are disclosed to CDP (see pie chart), they vary widely across institutions, products and asset classes - spanning external frameworks, market principles, internal criteria and bespoke methodologies.
This supports the use of broad benchmark buckets: green use-of-proceeds finance is typically easier to evidence where established standards exist, while broader sustainable and transition finance is harder to compare consistently due to the absence of a common taxonomy.
Investment area bucket definitions:
Social & inclusive finance - Proceeds tied to social outcomes.
Green finance (use-of-proceeds) - Proceeds tied to eligible green projects.
Sustainability-linked finance - Pricing/terms tied to sustainability KPIs.
Broad, mixed & transition finance - Aggregated, mixed or less granular sustainable finance disclosures
1.2 Forward view: Targets, Progress and Growth Momentum
Participants with sustainable finance targets
Source: Annual reports
Due to limited LI & AM target data, the remaining target progression and growth-area analysis focuses on Banks only.
Banks – Historical growth areas by category2
Product-mix lens: the chart above is split by sustainable finance category. It does not differentiate between bonds, loans or other products — important as delivery becomes more loan-led. Green bonds remain resilient, but broader bond momentum, particularly sustainability-linked bonds, has cooled amid scrutiny of KPI ambition, greenwashing risk and pricing benefits. Loans and transition finance offer banks a more flexible route to support client decarbonisation and convert targets into ongoing origination.
2) Historical CAGR represents the annualised growth rate over the observed reporting period based on disclosed annual report data. Latest year growth represents year-on-year growth in the most recent reporting year.
02. Target basis & credibility
2.1 Interim Targets: Scope and Progress
Target-setting is becoming a key test of financed emissions credibility. Institutions are increasingly expected to show not only that targets exist, but that they are grounded in material portfolios, supported by credible pathways, monitored against progress, and governed through clear assurance and restatement practices.
Source: Annual reports
Banks
LI & AM
In alignment to prior years, we have observed that Banks generally disclose at a more granular level (commonly sector) than LI & AM (commonly asset class). Hence the graph above, and others going forward, will vary in granularity.
Target credibility watchpoints
3) To ensure comparability, we have focused on sectors and asset classes which are widely covered by most institutions.
2.2 Reference Pathways: Sector Alignment and Comparability
FIs have used benchmark scenarios which are reference pathways set by relevant industry bodies (IEA or regional/UK) to determine both their interim and net zero targets. This section summarises the scenarios used by Banks across sectors and Life Insurers & Asset Managers and overall book level. To ensure comparability, we have included only those sectors and asset classes for institutions which are covered by most of the institutions, namely the Oil and Gas, Power and Utilities, Mortgages and Commercial Real Estate for Banks and Listed Equity and Commercial Real Estate for Life Insurers and Asset Managers. The varying granularities observed in the chart, provider vs specific pathway, are reflective of the detail included in disclosure.
| Sector / Asset class | Common reference pathways |
|---|---|
| Power | IEA NZE, IEA APS, IEA SDS |
| Oil & gas | IEA NZE, IEA APS, NGFS |
| Mortgages | CRREM, CCC/UK CCC, IEA ETP/B2DS |
| CRE | CRREM, IEA NZE, CCC/UK CCC, IEA APS |
Source: PwC UK Sustainability
2.3 Assurance
Assurance readiness and reporting controls
Assurance is becoming a test of financed emissions maturity. FIs increasingly need to show that emissions disclosures are underpinned by reliable data, transparent assumptions and governed methodologies that can withstand external scrutiny.
Assurance distribution
Assurance is increasing, but maturity remains uneven. From our prior year benchmark on reporting years, Banks receiving limited assurance has increased by approximately 10%, which could be linked to firms preparing for CSRD-style mandatory sustainability assurance, where in scope. However, LI & AM assurance coverage remains broadly stable.
Expert view: Assurance
As climate reporting becomes more connected to financial reporting, firms will need to evidence that financed emissions metrics are produced through controlled, repeatable and well-governed processes.
ISSB-aligned reporting will also increase pressure on timing and cut-off. Sustainability-related financial disclosures are expected to cover the same period and be reported at the same time as the financial statements, making manual or sustainability-only reporting processes harder to sustain. Firms will need finance-grade controls over data sourcing, version control, calculation models, review points and late adjustments.
The boundary of assurance will also matter. Users need to understand what has been assured, what has not, and whether assurance covers selected metrics, selected portfolios, reporting-year figures, baselines, restatements or target-related disclosures. Without that clarity, there is a risk that assurance is interpreted more broadly than intended.
The next governance challenge is therefore not just whether emissions numbers can be assured, but whether the assumptions behind them can be defended. This includes clear governance over restatements, re-baselining and target resets; validation of vendor data and proxy models; and transparent disclosure of what has, and has not, been assured.
Institutions that address these foundations early will be better placed to move from assurance readiness to credible, repeatable assurance.
Paolo Taurae
2.4 Restatements: Transparency and controls
Restatements and Re-baselining
With the growing scrutiny of the design and transparency of climate targets, FIs are under pressure not only to set ambitious decarbonisation goals but also to demonstrate robust governance around how these targets evolve over time.
Banks | LI & AM proportions
Source: PwC UK Sustainability
Expert view: Restatements through a reporting lens
As this 2025 benchmarking shows, restatements of financed emissions reporting will be the norm, not the exception. In that context, the reporting requirements of standards such as those issued by the ISSB should be looked on as a valuable tool for clearly communicating externally the reasons for, and consequences of, those changes. Not as just a compliance exercise.
Preparers shouldn’t just focus on disclosure of restatements alone. To tell a cohesive story, the foundation will be clear disclosure of inputs, key assumptions and the extent of measurement uncertainty around financed emissions. That provides the backdrop against which restatements can then be clearly explained – what was the previously disclosed judgement that has now changed? What element of estimation uncertainty has now crystallised and caused a change? These broader disclosures also help to manage users’ expectations around what might evolve or change in the future.
Lastly, good reporting is rarely done for external purposes alone. It comes from active use of that information internally as part of governance processes. That ongoing use also provides confidence around the robustness of the information and allows management to refine their understanding of what really matters – exactly what users care about too.
Mark Randall
03. Scope & coverage
3.1 Disclosure coverage: Assets, sectors and value chain
The credibility of financed emissions disclosures depends heavily on what is included in scope. Reported metrics are only decision-useful where users can understand the asset classes, sectors, products, emissions scopes and value-chain segments covered — as well as any material exclusions.
Banks – Value-chain inclusion
Disclosed coverage gaps
Source: PwC UK Sustainability
3.2 Scope coverage: Gaps and comparability
Regulation is driving greater expectations for emissions coverage, while PCAF provides the guidance many institutions use to apply this in practice. From 2025 reporting onwards, PCAF raises the bar on emissions-scope coverage for LECB and BLUE, requiring full scope coverage across all sectors. For other asset classes, requirements remain centred on Scope 1 and 2 emissions, with Scope 3 included where relevant and data allows.
This reflects both the current limitations of Scope 3 data and the wider direction of travel under ISSB, CSRD and other climate disclosure frameworks: more complete, comparable and decision-useful financed emissions reporting. Under PCAF, where required Scope 3 emissions cannot be reported, institutions are expected to explain the data limitation or uncertainty.
CDP: Barrier themes
| 1 | Methodology / standards immature |
| 2 | Data quality / availability |
| 3 | Plans to improve in future |
| 4 | Group / aggregate level only |
| 5 | Internal only / not public |
Source: CDP
Scope is the least mature carbon-footprinting lens, and this matters for comparability. Firms are more able to break emissions down by asset class or sector than by emissions scope, limiting visibility over whether portfolio totals are driven by Scope 1, 2 or harder-to-measure Scope 3 exposures. The barriers cited — immature methodologies, data quality and availability constraints, aggregate-only reporting and internal-only analysis — suggest the issue is not just disclosure preference, but the underlying ability to produce decision-useful, comparable footprinting outputs.
04. Data & methodology
4.1 Data foundations: Methodology, sources and visibility gaps
With over 97% of Banks and 94% of LI & AMs in our population aligning to the PCAF methodology, PCAF remains the dominant market reference point for financed emissions reporting. However, alignment to PCAF does not mean data approaches are fully standardised.
PCAF and other leading guidance set the broad methodological basis for using reported, estimated and proxy data, but they generally leave institutions to determine appropriate data sources, assess relevance and accuracy, and apply judgement where reported data is unavailable. As a result, data sourcing remains a key area of variation across financial institutions.
Commonly disclosed data providers
| Portfolio | PCAF asset class | Public data providers | Third party providers |
|---|---|---|---|
| Real estate | Mortgages | EPC4 | PCAF |
| CRE | EPC4 | PCAF, MSCI & S&P | |
| Corporate & investment banking | BLUE / LECB | EXIOBASE | PCAF, MSCI, S&P, Bloomberg, ISS, CDP |
| Project finance | EXIOBASE | PCAF, Bloomberg | |
| Institutional banking | Sovereign debt | - | PCAF, MSCI |
Reporting & data lags
Reporting-year lag is the visible timing gap. 42% of Banks disclose financed emissions using a prior reporting year, weakening alignment with current-period financial exposures. This is also a live feasibility challenge: portfolio emissions often depend on clients first calculating and reporting their own emissions data. As ISSB-style reporting raises expectations for connected, period-aligned disclosures, firms will need to explain unavoidable timing gaps and their implications for portfolio interpretation.
4) Energy performance certificates – region-specific.
Input lags are the hidden timing gap. Even within the stated reporting year, attribution factors and emissions inputs may be older. Attribution-factor lags challenge alignment with reporting-year exposures, while emissions lags can rely on outdated technology or intensity data - making it harder to separate real decarbonisation from stale inputs or methodology updates.
4.2 Data Quality: Trends and comparability
Beyond methodological alignment, the robustness of financed emissions disclosures depends heavily on the quality and transparency of the underlying data. PCAF data quality scores provide a way to assess reliability, highlighting where reported emissions rely more heavily on estimates, proxies or less granular inputs.
We have observed 95% of Bank and 47% of LI & AM participants are utilising PCAF data quality scores in disclosure. Further breakdown is provided below.
Banks – PCAF data quality scores
LI & AM – Data Quality
Good practice emerging across the market
The benchmark shows examples of stronger practice across different institutions. This does not mean that one group of institutions is leading across all areas. It means that better reporting is becoming visible in specific parts of the market.
Better disclosures explain what has been measured, why numbers have changed and how financed emissions are being used in business decisions.
“Better reporting is not about showing that everything is perfect. It is about making financed emissions numbers easier to understand, easier to check and more useful for decisions.”
Expert view: Moving from reporting to management
From my perspective, stronger examples in the benchmark are not only producing financed emissions numbers for disclosure. They are starting to use those numbers to support governance, target tracking, transition planning, client engagement, capital allocation and risk management.
This shift requires more than applying a methodology. Institutions need a clearer operating model for sustainability reporting and climate risk management. That means better data integration across the business, clearer ownership of data and controls, and stronger processes to monitor year-on-year movements, methodology changes and restatements.
It also means connecting financed emissions to risk and strategy. Banks need to understand how climate and emissions data are used in credit decisioning, model risk management, vendor data oversight, balance-sheet coverage and scenario analysis. The same data should also support decarbonisation strategy, including transition planning, reference pathway choices and assessment of decarbonisation levers.
For many institutions, this remains an evolving journey. The priority is to make financed emissions reporting clearer, more controlled and more useful for management decisions over time — across data, reporting, risk and strategy.
Vinay Sewraz
Financed emissions benchmarking
Download all past sustainability reports.
How PwC can help:
from measurement to management
GHG Emissions Analyser
An in-depth sustainability disclosure analytics tool that visualises key metrics to identify market-wide trends, peer differences and reporting gaps across several FIs. To explore the full benchmark dataset and gain access to our comprehensive GHG Emissions Analyser, please reach out to our team.
Portfolio Emissions Manager (PEM) tool
Enables financial institutions to calculate, monitor and analyse financed emissions across portfolios, supporting target-setting, scenario analysis and regulatory reporting requirements.
Sustainability reporting
Finding: Sustainable finance commitments are increasingly visible, but definitions, classification and target coverage remain inconsistent.
How PwC can help: Classification and eligibility review; governance over definitions and approvals; second-party opinions; links to client transition plans, product strategy and portfolio steering.
Target basis & credibility
Finding: Targets are being disclosed, but pathway choices, progress tracking and treatment of re-baselines / restatements vary.
How PwC can help: Emissions baselining and target design; pathway selection and target coverage assessment; progress tracking, governance over restatements, re- baselining and methodology changes
Scope & coverage
Finding: Coverage is expanding across core portfolios, but gaps remain across asset classes, sectors, value chains and Scope 3.
How PwC can help: Portfolio coverage assessment; PCAF asset-class mapping; boundary, exclusion and materiality review; roadmap to close material coverage gaps.
Data & methodology
Finding: PCAF has created a common language, but data sources, proxy types, methodologies, lags and data quality still differ.
How PwC can help: Data source and provider review; proxy and estimation methodology assessment; PCAF data quality plans; vendor governance and assurance readiness.
