You must use a look-through approach: report the investee companies’ Scope 1 and 2 emissions in your PAI, even if the investment is through a UCITS. Emissions follow the investee’s scope, not the management company’s.
With regard to how a financial market participant (e.g. a UCITS management company) discloses PAI indicator 1 in Table 1 of Annex I of the SFDR Delegated Regulation in relation to its financial products (e.g. a UCITS), how should the financial market participant include the financed emissions from its investments through the financial products (e.g. a UCITS) under the financial market participants' scope 1, 2 or 3 GHG emissions in PAI indicator 1 of Annex 1 of the SFDR Delegated Regulation? Should investments managed on behalf of products (e.g. a UCITS) be included under scope 1/2 or under scope 3 for the company managing the product (e.g. a UCITS management company)?
In cases where financial market participants are aggregating the adverse impacts of their financial products or their financial products invested in other financial products (such as fund of funds), there should be a look-through approach to the investee companies causing the GHG emissions. I.e., the PAI indicator 1 (GHG emissions) is calculated from the underlying investee companies, irrespective of whether the investment in them is direct or indirect (the indirect one would e.g. be an investment through a UCITS). The PAI indicators measure the financed emissions of the financial market participant’s investments. For the PAI indicators’ GHG calculations, financed emissions belonging to each scope from investee companies should be allocated to the same scope at the financial market participant level. For instance, investee companies’ Scope 1 and 2 GHG emissions should be allocated to the financial market participant’s Scope 1 and 2 GHG emissions in the PAI indicators.
European Supervisory Authorities (ESAs)
