Portfolio carbon footprint: sector average or company-specific?

Published 23 September 2026

A portfolio carbon footprint is the share of your counterparties' emissions that is attributed to your financing or investment. The tonnage on the page tells you very little on its own. What decides whether it can be used is whose figure each line is built on: the counterparty's own, or the average for its sector. Two institutions can publish identical totals, one built from company disclosures and one from sector averages, and only one of them can act on it.

This guide sets out how each kind of figure is produced, what each can and cannot support, how much of a portfolio typically already has a company-specific figure, and how to read the mix honestly.

What is a portfolio carbon footprint?

A portfolio carbon footprint is the sum, across every holding, of each counterparty's emissions multiplied by an attribution factor. For a listed company the attribution factor is your outstanding amount divided by its enterprise value including cash; for a private company it is your outstanding amount divided by its total equity plus debt. PCAF, the Partnership for Carbon Accounting Financials, publishes the method, and it also publishes the data quality hierarchy that says how reliable each counterparty figure is, from score 1 (reported and verified) to score 5 (estimated from a sector or asset class average).

Asset managers often report the same information as an intensity, the weighted average carbon intensity (WACI), which weights each holding's emissions per unit of revenue by its portfolio weight. The attribution and the weighting are arithmetic. The counterparty emissions figure underneath is the variable, and it is the subject of this guide.

How is a sector-average portfolio footprint produced?

By multiplying each counterparty's revenue, or your exposure to it, by an average emissions intensity for its sector and country. The intensity comes from an environmentally extended input output model or a sector dataset, published as tonnes of CO2e per unit of revenue for a sector in a region. Under PCAF this is the economic activity method, data quality score 4 when the counterparty's actual revenue is known and score 5 when even the revenue is estimated.

The method is fast, it covers everything, and it is the same for every company in the sector. That last property is the problem. A regional bakery chain that runs on renewable electricity and one that does not carry the same intensity. A logistics company that has cut its fleet emissions by a third since its base year carries the same intensity as one that has not. The figure changes when the sector average is revised or when your exposure changes. It does not change when the company does.

What can a sector-average figure support, and what can it not?

It supports an aggregate disclosure. A portfolio total built from sector averages is a legitimate estimate for reporting, provided the data quality is disclosed alongside it, and PCAF requires exactly that.

It cannot support anything that happens at the counterparty level. Engagement is the clearest case: there is no point asking a company to improve a number that is not its own. Target setting is the second: a sector-average portfolio will show progress only through divestment or through the sector average falling, whatever your counterparties do. Lending and pricing decisions are the third: a green loan priced on a sector average is priced on the sector, and a relationship manager cannot tell a customer why its rate moved. The moment a portfolio footprint is meant to drive a decision about a specific company, the sector average stops working.

What is a company-specific emissions figure?

A company-specific (primary) figure is one calculated from what that organisation itself has disclosed. Three kinds of disclosure produce one: the organisation's own reported greenhouse gas inventory, a published carbon footprint for a product or service it sells, and activity data about what it consumed. All three are primary data in the GHG Protocol's terms, because they come from the specific company in the value chain rather than from an average. A sector factor is secondary data. The distinction, and where each method sits, is set out on the page on primary versus secondary emissions data.

The part most portfolio teams miss is that the first kind already exists for a great many counterparties, including private ones. A company that has published an inventory in its annual report, its sustainability statement, a regulatory filing or a response to a large customer has produced a primary figure. It has simply not sent it to you. Under PCAF that figure is data quality score 2, or score 1 where the inventory was independently assured, without anyone in your institution collecting anything.

How much of a typical portfolio already has a company-specific figure?

More than the estimated share in most reports suggests, and the exact proportion is knowable rather than guessable. Listed counterparties nearly all have one. Among private companies the share varies by sector, size and country, but disclosure has spread well beyond the listed market: large private groups, subsidiaries of listed parents, suppliers to companies with Scope 3 programmes and companies under national reporting rules have all published, often for years.

DitchCarbon holds verified emissions data for over 2 million organisations, built on primary emissions data wherever it exists, private companies included, matched to counterparties through entity resolution against DUNS, LEI and ISIN identifiers. On any book run through it, the proportion of counterparties carrying a reported figure is a number on screen, not an estimate. That is also the test to put to any provider: ask for that proportion on your own counterparties.

How do you read the mix in a portfolio footprint honestly?

Line by line, with the method shown. DitchCarbon's disclosure coverage view starts at the portfolio level: what proportion of the organisations in it publish emissions data at all, hold Scope 1, 2 and 3 figures and have set targets, each as a percentage. Each organisation then records which of four methods produced its figure: its own reported inventory, product data from a published carbon footprint, activity data, or industry data where nothing better exists. Industry data is fourth of four. The method is a filterable column, and the portfolio total toggles between organisation-specific and industry factors, so the share of the total still resting on a sector average is visible, and so is the tonnage it represents.

That is the honest disclosure PCAF asks for, produced by the data rather than reconstructed for the report. Every figure carries its source and change history, so a reported line can be traced to the document it came from, and a modelled line says that it is modelled. Coverage gaps shown, not hidden.

What do you do with the counterparties still on a sector average?

Rank them, then ask the few that matter. Sorting the modelled lines by embodied emissions shows which counterparties carry enough of the total to be worth a request; the long tail of small exposures on an industry factor is a legitimate use of the method and does not need chasing.

For the ones that are worth it, a request from the DitchCarbon portfolio view goes out prepopulated with what the counterparty has already published, so its team confirms and corrects rather than compiles. The answer lands on a profile the company owns and can reuse with every bank and buyer that asks, which is why response rates on a prepopulated request run higher than on a blank questionnaire. Where nothing comes back, the line stays on a regionalised industry factor and the record says so.

If you are the company being measured

Your lenders and investors are producing a figure for you either way. If you have not published, it is your sector's figure with your revenue attached, and it will follow you into every portfolio you appear in. If you have published, the figure exists but may not have reached them. Claiming your DitchCarbon profile is free: your published inventory becomes the figure any logged-in viewer sees, you answer context questions once, and every bank or buyer that asks afterwards reads the same answer. The same profile is what your own suppliers see when you ask them, because most companies are on both sides of this.

The short version

A portfolio carbon footprint built from sector averages is a disclosure. One built from counterparty disclosures is a working instrument: it moves when a company acts, it can be traced to a document, and it can carry an engagement, a target or a lending decision. Most portfolios already have far more of the second kind available than they use, and on DitchCarbon the split between the two is a filter, a toggle and a number rather than an assumption.