ASCOR revolutionises investor insight with climate finance indicators


The ASCOR project has updated its assessment framework, introducing climate spending indicators to aid investors in evaluating climate risks.

Antonina Scheer, Research Project Manager at TPI, highlighted the major enhancement in the framework’s Pillar 3, now called ‘climate finance’ instead of ‘opportunities to finance the transition.’ This revision broadens the scope to include aspects like international finance contributions and renewable energy opportunities, besides the earlier focus on historical emissions trends, climate policies, and financing needs for climate goals.

A novel addition under ‘climate finance’ is the focus on government climate action-related spending disclosure and climate budget tagging, drawing upon World Bank reports and other literature. This inclusion aims to fill a gap in the previous framework, providing vital information to investors about how nations manage climate risks.

During a public consultation, ASCOR refined the tool to avoid complexity and ensure its practicality. The feedback led to the rationalisation of indicators, ensuring fairness, especially for middle and low-income countries. The updated framework now features 13 sub-categories with 39 indicators, down from the initial 19 sub-categories and 55 indicators. These indicators are based on detailed policy analysis, and the tool, set for release in early December, will include source links for each indicator.

Finally, the framework’s methodology publication will be followed by the release of assessments for 25 countries, which include major emitters like the UK, Australia, Bangladesh, and Japan. From 2024, ASCOR plans to expand its assessments to over 100 countries included in major sovereign bond indices.

Antonina Scheer, Research Project Manager at TPI Centre, said, “This was an area missing from the previous framework and required in-depth research to develop an appropriate methodology, drawing on World Bank reports and other literature on climate budget tagging practices.”

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