KBRA Launches Carbon Transition Risk MetricsāCarbon Quantum (KCQ) Ratios
NEW YORK–(BUSINESS WIRE)–#KBRA–KBRA releases research that introduces its new carbon transition risk metrics called KBRA Carbon Quantum (KCQ) ratios. In our view, ESG scores and/or total emissions without context are a poor proxy. A better approach is to assess a company’s financial capacity to absorb any future costs associated with emissions.
Environmental, social, and governance (ESG) factors have become increasingly important considerations in the investment decision-making process. However, objective and quantifiable metrics to inform these investment decisions can sometimes be elusive or are not yet fully developed. To fill this need, we have developed KBRA carbon quantum (KCQ) ratios to help investors dimension an otherwise amorphous aspect of climate risk and to specifically move beyond assuming the level of credit risk is related to total emissions.
KCQ ratios aim to show the potential impact on a company’s financials by applying a range of theoretical prices per metric tonne (t) of carbon emissions. This exercise is designed to help quantify and benchmark the hypothetical carbon transition risk to each individual company.
Click here to view the report.
About KBRA
KBRA is a full-service credit rating agency registered in the U.S., the EU, and the UK, and is designated to provide structured finance ratings in Canada. KBRA’s ratings can be used by investors for regulatory capital purposes in multiple jurisdictions.
Contacts
Andrew Giudici, Senior Managing Director
Global Head of Corporate, Project, and Infrastructure Finance
+1 (646) 731-2372
andrew.giudici@kbra.com
Brian Ford, CFA, Managing Director
Head of Structured Finance Research
+1 (646) 731-2329
brian.ford@kbra.com
William Cox, Senior Managing Director
Global Head of Corporate, Financial, and Government Ratings
+1 (646) 731-2472
william.cox@kbra.com
Pat Welch, Senior Managing Director
Chief ESG & Ratings Policy Officer
+1 (646) 731-2481
patrick.welch@kbra.com
Van Hesser, Senior Managing Director
Chief Strategist
+1 (646) 731-2305
van.hesser@kbra.com