Net Zero Finance Tracker Methodology

The Net Zero Finance Tracker (NZFT) methodology establishes a system for monitoring how financial institutions transition from climate intentions to real-world results. It employs a three-dimensional assessment framework—Targets, Implementation, and Impact—using a combination of qualitative tiered badges and quantitative metrics. The current version focuses on 553 members of the Glasgow Financial Alliance for Net Zero (GFANZ), representing USD 85 trillion in assets. The methodology emphasizes transparency, concreteness, and ambition, utilizing data from approximately 30 providers to track indicators such as mitigation targets, TCFD disclosures, and project-level clean energy financing.

• The NZFT assesses financial institutions across three dimensions: Targets (intentions), Implementation (strategies and internal processes), and Impact (real-world outcomes).
• Qualitative indicators for Targets and Implementation are scored using a tiered badge system based on transparency, concreteness, comprehensiveness, and ambition, ranging from 'No response' to 'Full response'.
• Quantitative Impact metrics track both supportive activities, such as project-level clean energy financing and green lending, and detrimental activities, such as project-level fossil fuel financing and exposure to misaligned assets.
• The tracker's current scope is limited to members of the Glasgow Financial Alliance for Net Zero (GFANZ), which as of December 2022 included 553 institutions with combined owned assets and assets under management (AUM) of USD 85 trillion.
• To avoid double-counting and ensure accuracy, actions are attributed exclusively to the specific entity reported by the data source, meaning actions by a subsidiary do not contribute to the score of its parent headquarters.
• Aggregate data is presented using two methods: a simple distribution by the number of institutions or a weighted distribution based on financial metrics such as Assets Under Management (AUM), Total Assets, or Revenue.

APA

Micale, V., Marini, N., Connolly, J., & Fernandes, P. D. A. (2023). Net Zero Finance Tracker Methodology. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2023/10/NZFT-Methodology.pdf

Chicago

Micale, Valerio, Nikita Marini, Jake Connolly, and Pedro de Aragão Fernandes. Net Zero Finance Tracker Methodology. Climate Policy Initiative, 2023. https://www.climatepolicyinitiative.org/wp-content/uploads/2023/10/NZFT-Methodology.pdf.

Wikipedia

{{cite report |last1=Micale |first1=Valerio |last2=Marini |first2=Nikita |last3=Connolly |first3=Jake |last4=Fernandes |first4=Pedro de Aragão |title=Net Zero Finance Tracker Methodology |publisher=Climate Policy Initiative |date=November 2023 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2023/10/NZFT-Methodology.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{micale2023net, author = {Micale, Valerio and Marini, Nikita and Connolly, Jake and Fernandes, Pedro de Aragão}, title = {{Net Zero Finance Tracker Methodology}}, institution = {Climate Policy Initiative}, year = {2023}, month = nov, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2023/10/NZFT-Methodology.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }