The glossary provides more information on some of the key terms we use on MyFairMoney. It also describes criteria, methods and data sources in more detail. This will help you dive deeper into the topic of sustainable investment!

Paris compatibility

This score maps how well the fund is in line with the goals of the Paris Climate Agreement and climate scenarios. Paris compatibility in this case means that the production plans of the companies in a fund are on average already in line with the goals of the Paris climate conference to limit global warming to up to 1.5 C°. As with all individual indicators, the calculated value represents a highly simplified view. The necessary aggregation across sectors leads to the loss of essential information within sectors.

The score is assigned from -100 to +100. Funds with a score of -100 do not meet the goals of the Paris Climate Agreement at all, funds with a score of +100 exceed them. From 0, a fund is considered climate-compatible. Similarly, letters are assigned to categorise the value. This evaluation works similar to a school grade. "F" starts at -100. From a value of 0, a fund receives the grade "A".

The fact that funds sometimes have no value can have two reasons. On the one hand, they are not invested in the sectors considered by the PACTA method. They therefore have no exposure.

On the other hand, they may also have an exposure below a threshold in the climate-relevant sectors. In these cases, the score is not meaningful enough. A fund that invests in the real estate sector, for example, and invests a small amount in cement producers cannot be scored by this low exposure alone. Here, 2° Investing Initiative has dispensed with a score.

The Paris Score was developed by 2° Investing Initiative in cooperation with InfluenceMap. It represents a way of aggregating the climate performance of financial products. Other aggregations are possible. Here we do not claim to represent the absolute truth. The Paris score comes with the problems of a single indicator.

For technical documentation.