Carbon intensity
Climate-related portfolio ambitions of the Swiss Life Group
Paris Agreement
In the context of Swiss Life’s PAM portfolio – securities, real estate and infrastructure – Swiss Life’s ambition is to make finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development, as set out in the Paris Agreement to limit global warming to well below 2 degrees Celsius above pre-industrial levels.
Swiss Life pursues the ambition for the entire PAM portfolio. With regard to external disclosure, Swiss Life reports on its proprietary bond portfolio. In addition to other metrics in the context of Swiss Life’s proprietary bond portfolio, Swiss Life works with the climate-related metric carbon intensity. The carbon intensity indicates the greenhouse gas efficiency. For government bonds, the metric reflects the greenhouse gas emissions per USD million nominal gross domestic product (GDP) and for corporate bonds, the metric reflects the greenhouse gas emissions per USD million sales.
Amongst other criteria, Swiss Life pursues new bond investments in companies and countries with low overall carbon intensity. However, Swiss Life, as an investor, cannot directly steer the carbon intensity of the issuers.
In the context of greenhouse gas accounting, the carbon footprint of Swiss Life’s proprietary bond portfolio corresponds to a subset of Swiss Life’s Scope 3 emissions.
Carbon intensity of Swiss Life’s proprietary bond portfolio as at 31.12.2020
| Government bonds (CO2 equivalents in t/USD million nominal GDP) | Corporate bonds (CO2 equivalents in t/USD million sales) | |||
|---|---|---|---|---|
| Carbon intensity 1 | 194 | 145 | ||
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1 The carbon intensity values correspond to approximately 90% of Swiss Life’s proprietary bond portfolio. © 2019 MSCI ESG Research LLC. Reproduced by permission.
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The carbon intensity for Swiss Life’s proprietary government bond portfolio reflects the strong presence of the domestic markets and the carbon intensity for Swiss Life’s proprietary corporate bond portfolio reflects the substantial presence of service-related industry sectors. Therefore, Swiss Life’s proprietary bond portfolio has a much lower carbon intensity than comparable bond benchmarks. Nearly 100% of Swiss Life’s proprietary government bond portfolio is invested in countries which have ratified the Paris Agreement.