Morgan Stanley commits to measuring climate change impacts of its investments

Morgan Stanley committed Monday to measuring how its loans and investments impact climate change, becoming the first major U.S. financial institution to join a coalition accounting for carbon in finance.

Morgan Stanley, one of the largest U.S. investment firms, joined the Partnership for Carbon Accounting Financials (PCAF), which uses various data sets to estimate greenhouse gas emissions from investments and projects.

The commitment comes as major financial institutions are increasingly going green.

A number of major banks, including Morgan Stanley, Goldman Sachs, JPMorgan Chase and Wells Fargo, have already pledged not to finance any drilling in the Arctic National Wildlife Refuge. 

Others, such as BlackRock, have made broader commitments to pull away from fossil fuel investments. 

However, investment in fossil fuels overall still remains high. Thirty-five major banks invested some $2.7 trillion in fossil fuels from 2016 through 2019, according to research from the Rainforest Action Network.

PCAF is still refining its methodology for assessing the climate change impacts of investments.

“Looking ahead, we know that in order to influence positive action on climate change in the private sector, there needs to be global adoption of a shared financed emissions accounting methodology across financial institutions, including by the global banks, many of which are based in the U.S.,” Ivan Frishberg, chair of the PCAF North America group, said in a statement.