The Carbon Epic is designed to take the portfolio manager through the most basic information about their holdings to scenario analysis and portfolio stress testing. Part I provides all the necessary basic information, including the Summary. The following sections are included in the Portfolio Summary:

  1. Carbon Ownership

  2. Company’s Portion of Portfolio Total Emissions

  3. Owned Carbon Intensity

  4. Company Carbon Intensity

  5. Company Carbon Intensity vs. Industry

1. Carbon Ownership:

A portfolio manager does not own 100% of a company's shares, nor do they own 100% of the company's annual carbon emissions. Rather, the portfolio manager owns a small portion of outstanding shares. That portion also applies to the company's annually reported carbon emissions. We called that "owned emissions."

2. Company's Portion of Portfolio Total Emissions

The portion of portfolio total emissions refers to the portion of scope 1, 2, and 3 GHG emissions owned by a company relative to the total scope 1, 2, and 3 GHG emissions of the entire portfolio. This value considers the company's ownership ratio in your portfolio.

3. Owned Carbon Intensity:

The owned carbon intensity of a holding includes the portfolio ownership ratio of the holding company to reflect the ratio of carbon emissions to holding revenue owned by your portfolio.

4. Company Carbon Intensity

A ratio of the holding company’s carbon emissions to the $M revenue reflects the company’s carbon intensity. This is not specific to the weight of the holding company in the portfolio. Rather, it is an indication of the company’s intensity relative to its revenue.

5. Company Carbon Intensity vs. Industry

The company's carbon intensity is compared to the average carbon intensity of the industry group to which the company belongs, resulting in a percent difference between the two values. If the company’s carbon intensity is higher than the average carbon intensity for its industry group, the value will be positive, followed by a red up arrow. If the company’s carbon intensity is lower than the average carbon intensity for its industry group, the value will be negative, followed by a green down arrow.

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