ISS Sustainability Solutions, the sustainable investment business of ISS STOXX, announced today the launch of Sovereign Climate Impact Report, a new solution aimed at enabling investors to understand, measure, report, and act on climate transition-related risks and impacts of their sovereign portfolios.
According to ISS, the new solution, forming part of its Climate Solutions suite, was developed in response to market demand for a sovereign focused equivalent to its corporate issuer-focused Climate Impact Report, which provides investors with detailed analyses of Scope 1, 2 and Scope 3 emissions, transition and physical risks and climate scenario analysis.
Incorporating more than 180 current and forward-looking metrics, the new Sovereign Climate Impact Report encompasses carbon footprinting, transition analysis, scenario alignment and climate policy. In addition to managing climate data, ISS said that the new solution will also support investors in meeting climate-related disclosure requirements aligned with a series of standards and regulations including ISSB, TCFD, CSRD and SFDR, among others.
The solution also includes transition risk analysis focused on the energy profile of sovereigns including fossil fuel reserves, fossil fuels dependency, subsidies and their energy mix and power generation composition, compared to the Net Zero scenario provided by the International Energy Agency (IEA), and provides portfolio scenario alignment to net zero emissions by 2050 using climate scenarios provided by the Network for Greening the Financial System (NGFS).
ISS added that the solution aligns sovereign and sub-sovereign exposures to the latest Partnership for Carbon Accounting Financials (PCAF) methodology and guidance, and includes an emissions PCAF quality score for enhanced transparency.
Till Jung, Head of Sustainability Business at ISS STOXX said:
“As a leading provider of climate research, data and analytics, and a trusted partner to the global institutional investor community, we are pleased to launch the Sovereign Climate Impact Report, the latest new offering in our comprehensive suite of climate solutions, with further innovations planned in 2025.”
