Developing Metrics for Transition Finance

This paper discusses banks' evolving role in financing the transition to a net-zero economy. It highlights the need for new metrics to report Transition Finance efforts. The purpose of this paper is to advance the discussion of which metrics may be most useful for banks to publish to increase transparency on their Transition Finance activities. It does not seek to replace current metrics and thinking but looks to consider Transition Finance metrics which may sit alongside existing metrics. Transition Finance metrics are intended to add clarity around a bank’s activity and not to replace portfolio emissions reduction metrics or decarbonisation targets to which banks have already committed. Additionally, this paper is not intended to be guidance which needs to be adopted by banks, but rather inputs to further evolve approaches to transition finance metrics and reporting.