Green bonds are debt instruments issued by companies to fund green projects. Each entity in the portfolio produces a report detailing how the money raised by issuing the bond is spent and how the project supports transition to a greener economy, including the amount of renewable energy created as a result of the project and level of avoided emissions.
The carbon footprint of a company measures carbon emissions associated with its operations (such as the fuel combustion, fuel used in company vehicles and purchased electricity). The fund holds equities of leading companies from around the world that have demonstrated their ability to have a smaller carbon emissions relative to peers. We can measure the level of CO2 avoided, relative to a conventional index that invests in global equities without focus on carbon emissions.
To offset the carbon contribution of the equity portion of the fund, the management company purchases verified emission reduction certificates, created by a certified carbon offset scheme. This means that part of the fund’s management fee is used to pay for a project that takes carbon out of the atmosphere each year. The carbon created by the equity holdings is monitored on a monthly basis and annually the total amount of carbon produced is offset.
Quintet Earth’s offset project
Quintet Earth’s offset project is a community reforestation project in San Juan de Limay and Somoto, Nicaragua. The project addresses the causes of deforestation, ensures direct, ongoing community involvement and technical training, and provides financial benefits for participants throughout the project. Find out more at https://www.myclimate.org/information/climate-protection-projects/detail-climate-protection-projects/nicaragua-forestry-7186/
The calculations provided by this tool are for informational purposes only, to illustrate the positive environmental impact of investing in Quintet Earth. The impacts generated are indicative only, based on information provided by the issuers of the equities and bonds held by the fund, and are not meant to be a prediction or a projection. Quintet cannot be held responsible for inaccuracies in issuers’ reporting. Below we have provided an overview so that you can understand how we calculate these figures.
Hectares of reforested land
Each year we take information reported by the issuers of the equities held to calculate the carbon associated with the fund. According to the community reforestation project documentation one ton of carbon can be offset by planting 13.3 trees. There are 1667 trees are planted per 10000m2.
The area shown for Quintet Earth includes an estimate of the trees planted between the fund’s 2022 inception and the end of the current calendar year. To estimate the area for future years, fund assets and the carbon footprint of the equity portion of the fund are assumed to be constant in all periods. For an individual’s contribution, the calculation utilizes inputted dates with the carbon footprint of the equity portion of the investment and the size of investment is assumed to be constant in both past and future periods.
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The Carbon footprint of a portfolio measures the CO2 emissions associated with a portfolio normalised by the market value of the portfolio (expressed in tons CO2 per million USD invested). Carbon figures depend on the breadth of activities examined and are categorised within ‘scopes’ by the GHG Protocol Corporate Standard.
Scope 1 emissions: emissions from sources owned or controlled by the company, typically direct combustion of fuel in a furnace or vehicle.
Scope 2 emissions: emissions measurement that is broader than scope 1 and include those caused by the generation of electricity purchased by the company.
This tool utilizes scope 1 and 2 emissions.
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Past performance is no guarantee of future results.