The Disclosure module's SFDR report transforms your portfolio's raw data into reportable metrics (Principal Adverse Indicators, or PAIs) aligned to SFDR's methodology. Before downloading SFDR metrics, the report highlights any potential issues with your underlying data that may negatively affect the report and gives you insights into how each building contributed to the result metrics.
What are SFDR Principal Adverse Indicator (PAI) Metrics?
The SFDR framework seeks to enhance transparency and ensure that financial products consider sustainability risks and adverse impacts on the environment, society, and governance.
Principal Adverse Impacts metrics are specific indicators used by financial market participants to measure the negative effects of their investment decisions on various sustainability factors. For a real estate portfolio, PAIs include carbon and energy performance, deployment of renewable energy, exposure to inefficient assets, and whether assets are involved in the fossil fuel industry.
What SFDR PAIs can Disclosure Generate?
Disclosure's SFDR report includes the following PAIs:
| 18. GHG emissions | Scope 1 GHG emissions generated by real estate assets (MTCO₂e) |
| Scope 2 GHG emissions generated by real estate assets (MTCO₂e) | |
| Scope 3 GHG emissions generated by real estate assets (MTCO₂e) | |
| Total GHG emissions generated by real estate assets (MTCO₂e) | |
| 19. Energy consumption intensity | Energy consumption intensity (GWh/m²) |
Why are some of my buildings not included in my SFDR report?
Disclosure selectively excludes buildings if they don't need SFDR's reporting criteria. To be included in an SFDR report, a building must be owned, not leased, and it must have been owned for at least one day of the reporting period.
Why are some of my buildings' data points showing warnings?
In the table of your portfolio/group's buildings, Disclosure highlights any data (or lack thereof) that may have a negative impact on the quality or accuracy of reportable metrics. Warning highlights mean different things depending on the datapoint, but some reasons include:
- The datapoint is essential for accurate reporting but it has not been filled out
- The datapoint's value is unexpectedly high or low compared to other buildings of similar sizes/types
Issues with your buildings' datapoints can be corrected in the Core app.
How is aggregate carbon calculated for SFDR?
The energy usage that informs Disclosure's outputs is collected in the Core module through Connect, ENERGY STAR Sync, Core API, bulk upload, or manual entry.
The following diagram shows how raw usage data is transformed into carbon for SFDR. Some important aspects to note:
- Disclosure's carbon calculations obey the GHG protocol's location-based methodology, meaning that any grid-procured renewable energy counts as full-carbon. On-site renewables are zero-carbon.
- Each building's total carbon emissions are multiplied by your % ownership of the building.
See here for the SFDR Transformation Logic.
How is carbon scoped for the SFDR report?
For SFDR, carbon is scoped according to Operational Control methodology in which usage that occurs on Tenant Spaces and EV Charging spaces count toward Scope 3 (tenant-driven emissions). The payor of the meter is not considered for scoping.
Meters that serve Whole Site, Common Area, or Exterior Areas are treated as Scope 1/2 (landlord-driven emissions).
Emissions from meters that serve a mix of common and tenant spaces are prorated into Scope 1/2 and Scope 3 based on the ratio of landlord- vs tenant-controlled floor area served.
Any meters that are not assigned to a space are treated as Scope 1/2, so be sure to appropriately assign any unassigned meters.