Facilitated Emissions
When a bank underwrites a bond for an oil company, it does not keep the bond — it places it with investors and moves on. Financed-emissions accounting misses that activity entirely, because nothing stays on the balance sheet, yet two-thirds of US bank financing for fossil-fuel expansion has historically flowed through exactly this channel rather than through on-balance-sheet lending.
Facilitated emissions close that gap: they capture the climate impact of helping others raise capital.
Facilitated emissions are the emissions tied to a financial institution’s capital-markets activities — bond and equity underwriting, syndication, arranging — where it raises financing it does not retain. They are measured under PCAF Part B at a 33% weighting.
Facilitated Emissions at a Glance
| Property | Value | Notes |
|---|---|---|
| Governing standard | PCAF Part B | Facilitated Emissions Standard, finalised December 2023 |
| Activities covered | Primary issuance + loan syndication | Bond and equity underwriting, arranging, syndication |
| Attribution numerator | Facilitated amount | Not the outstanding amount used for financed emissions |
| Weighting factor | 33% | Derived from the G-SIB classification; mandatory reporting basis |
| Optional disclosure | 100% (unweighted) | Permitted only if reported separately with clear rationale |
| Reporting treatment | Separate line | Never merged into the financed-emissions total |
| Data quality scale | 1–5 | Same PCAF scoring system as financed emissions |
| Related modules | Financed (A), insurance-associated (C) | Three PCAF modules; different attribution bases |
Definition and PCAF Part B
Facilitated emissions account for the role financial institutions play in primary capital markets — underwriting and arranging debt and equity issuance — even though the resulting securities are sold on to investors. They are defined in the PCAF Facilitated Emissions Standard (Part B), the capital-markets companion to the financed-emissions methodology, finalised in December 2023 after extended industry negotiation. The Standard covers the primary issuance of capital-markets instruments and loan syndication; secondary-market trading and co-manager roles sit outside its current scope.
The reason a separate module exists is that capital-markets activity is structurally different from lending. A lender holds the exposure and carries it on the balance sheet; an arranger enables a transaction and then steps away. Reporting facilitated emissions has long been optional under the GHG Protocol Scope 3 Standard, which is why many institutions excluded it — Part B exists to make the measurement consistent and comparable across banks.
Attribution — the Facilitated Amount
Facilitated emissions reuse the attribution-factor logic of financed emissions, but with one mechanical change that practitioners must not miss: the numerator is the facilitated amount, not the outstanding amount. For financed emissions, the numerator is the drawn loan balance or the market value of the holding the institution retains. For facilitated emissions, it is the institution’s share of the transaction it arranged — typically apportioned using established capital-markets league-table conventions that split credit between active and passive bookrunners and lead managers.
Facilitated emissions = Attribution factor × Issuer emissions × Weighting factor
where Attribution factor = Facilitated amount ÷ Total issuer value, and the Weighting factor = 33%.
The denominator follows the same asset-class logic as financed emissions — EVIC for listed instruments, total equity plus debt for unlisted issuers — so the attribution factor expresses the institution’s share of the issuer, then the weighting factor scales that share down to reflect the facilitating role.
The 33% Weighting Factor
Because an arranger’s involvement is transient rather than a retained exposure, PCAF Part B applies a weighting factor of 33% to facilitated emissions. The figure was finalised in December 2023 and is derived from the Global Systemically Important Banks (G-SIB) classification framework. It recognises that the institution enabled the financing without holding the risk, so the attributed emissions are reported at roughly one-third of the share an equivalent on-balance-sheet loan would carry.
The Standard requires institutions to report facilitated emissions at the 33% weighting and to disclose the applied weighting clearly. It also permits — but does not require — an additional disclosure of the unweighted 100% figure, provided it is reported separately with a clear rationale. The 33% basis is the comparable, headline number; the 100% figure is supplementary transparency, not a substitute.
Facilitated emissions are reported separately from financed emissions, never merged into a single total. Combining them obscures the weighting and breaks comparability with peers who report the two streams distinctly.
Worked Example
A bank acts as bookrunner on a €300 million bond issuance for a manufacturer whose EVIC is €1.5 billion and whose reported Scope 1 + Scope 2 emissions are 120,000 tCO₂e. The bank’s league-table-apportioned facilitated amount on the deal is €60 million. All figures are stated in euros and drawn from the same reporting period.
Attribution factor = €60m ÷ €1,500m = 0.04 (4%)
Unweighted share = 0.04 × 120,000 tCO₂e = 4,800 tCO₂e
Facilitated emissions (33% basis) = 4,800 × 0.33 = 1,584 tCO₂e
Optional 100% disclosure = 4,800 tCO₂e (reported separately)
The PCAF Facilitated Emissions Calculator applies the Part B weighting automatically and returns the result alongside its data quality score.
Facilitated vs Financed Emissions
The distinction turns on whether the institution holds the exposure. A loan or bond on the balance sheet generates financed emissions (PCAF Part A) at full weight. Arranging an issuance that is sold to others generates facilitated emissions (Part B) at the 33% weighting. A third module, insurance-associated emissions (Part C), covers re/insurance underwriting and attributes on premiums rather than financing.
| Dimension | Financed (Part A) | Facilitated (Part B) |
|---|---|---|
| Institution’s role | Holds the exposure | Arranges, does not retain |
| Activity | Lending and investment | Underwriting, syndication |
| Attribution numerator | Outstanding amount | Facilitated amount |
| Weighting factor | 100% (full) | 33% (optional 100% alongside) |
| Reporting line | Scope 3 Category 15 | Separate facilitated line |
Avoiding Double Counting
The same bond can briefly appear as both a facilitation (at issuance) and a financed exposure (if the bank also retains some of it). PCAF’s separate reporting streams and the weighting factor are designed to prevent the arranger’s role and the holder’s role from being summed into an inflated number. Keeping them in distinct lines, each with its own data quality score, is the safeguard. To dampen the year-to-year volatility inherent in deal-driven facilitated figures, many institutions also apply a multi-year moving average across transactions — a practice PCAF accommodates.
Four Common Mistakes
- Using the outstanding amount as the numerator. Facilitated attribution uses the facilitated amount — the arranged share apportioned by league-table convention — not the balance held.
- Merging facilitated into the financed total. The two streams are reported separately; combining them hides the 33% weighting and breaks peer comparability.
- Reporting only 100% or only 33% without labelling. The 33% basis is mandatory and the applied weighting must be stated; a 100% figure is permitted only as a clearly-rationalised separate disclosure.
- Omitting the data quality score. Facilitated figures carry the same PCAF 1–5 score as financed emissions; without it the number cannot be benchmarked.
Frequently Asked Questions
They are the emissions linked to a financial institution’s capital-markets activities — underwriting and arranging bond and equity issuance — where it helps a client raise financing it does not keep on its balance sheet. They are measured under PCAF Part B at a 33% weighting factor, and reported separately from financed emissions.
Financed emissions come from exposures the institution holds on its balance sheet (Part A) at full weight, with the outstanding amount as the attribution numerator. Facilitated emissions come from arranging financing that is sold to others (Part B), use the facilitated amount as the numerator, are scaled by a 33% weighting, and are reported in a separate line.
PCAF Part B applies a 33% weighting to facilitated emissions, finalised in December 2023 and derived from the G-SIB classification framework. It reflects that an arranger enables financing without retaining the exposure. Institutions must report on the 33% basis and disclose the weighting; they may additionally report the unweighted 100% figure separately with a clear rationale.
PCAF Part B covers the primary issuance of capital-markets instruments — bond and equity underwriting — and loan syndication. The institution’s share of a deal is apportioned using capital-markets league-table conventions that split credit between bookrunners and lead managers. Secondary-market trading and co-manager roles are outside the current scope of the Standard.
Need someone who does this? 6 carbon accounting & inventory providers in our directory →