Value chain carbon footprints of Chinese listed companies

Measuring the value chain carbon footprints of listed companies is essential for cumulative climate actions and climate-efficient capital allocation. We trace the carbon emissions embodied in the value chains of Chinese listed companies and find that there is an increasing trend in terms of the carbon footprints of listed companies over the period 2010–2019. In 2019, the direct emissions from these companies reached 1.9 billion tonnes, accounting for 18.3% of national emissions. The indirect emissions were well over twice as large as the direct emissions from 2010 to 2019. Energy, construction and finance companies tend to have a greater volume of value chain carbon footprints, yet the distribution of their carbon footprints varies significantly. Finally, we apply the results to evaluate the financed emissions of leading asset managers’ equity portfolio investment in China’s stock market.


Supplementary information on the calculation results
1.1. Structure of carbon footprints at the provincial and sectoral levels Fig. S1| Scope 1, 2, and 3 carbon footprints at the provincial and sectoral levels in 2017 (million tonnes) Fig. S1 shows the results on the carbon footprints of eight sectors in the top five provinces by the volume of carbon footprints. There exists significant regional and sectoral heterogeneity in the structure of carbon footprints. The Scope 1 carbon footprint corresponds to a relatively greater share for energy-intensive sectors, such as the electricity and heating sector (Fig S1.g) and metal smelting and rolling sector (Fig. S1.f), which generate CO2 emissions to support the s3 production activities of other sectors. For the other six subfigures, their carbon footprint is made up mainly of indirect emissions (Scope 2 and 3 carbon footprints). For example, the business activities in the accommodation sector rely on electricity and heat supply. Therefore, the Scope 2 carbon footprints related to electricity and heat supply account for a greater share. In addition to the electricity and heat supply sector, many other agents, whose emissions are related to Scope 3 carbon footprints, are involved in the upstream and downstream value chains. Figure   1 shows that the volume of the Scope 3 carbon footprint tends to be significantly greater than that of the Scope 2 carbon footprint. For instance, the carbon footprint of the electronic equipment sector is composed mainly of the CO2 emissions embodied in the upstream and downstream value chains. The huge volume of a sector's Scope 3 carbon footprint highlights that firms in this sector have a greater influence on reducing other firms' carbon emissions and have greater collaborative opportunities in terms of climate actions with their value chain partners. Therefore, it is essential for these firms to engage in value chain climate change mitigation activities to promote collaborative climate actions along the value chain.
Developed coastal provinces, such as Guangdong and Zhejiang, and the inland fossil-fuel producing provinces, such as Shanxi and Neimenggu, tend to have a large carbon footprint.
These provinces all hold critical positions in China's domestic production networks. Their climate actions would have a powerful demonstration effect on other regions. China's climate policies towards greener value chains should be more targeted towards these provinces.
Although the present study presents only the results of the top five provinces, the structures of their carbon footprints are almost the same. The structure of a sector's carbon footprint is determined mainly by the position of this sector in the production networks. For instance, those sectors located upstream of the production network tend to correspond to greater downstream Scope 3 emissions and vice versa. An increasing number of enterprises, such as Microsoft 1 , are adopting climate measures to reduce not only their direct emissions but also their value chain emissions. The information on the sectoral carbon footprint could also help provide a more complete picture of the structure of those CO2 emissions that are directly and indirectly related to enterprises' production activities. In addition, the carbon disclosure behavior of most firms is voluntary 2 , and these firms may adopt different approaches and boundaries 3 . The results for firms within the same sector may not be comparable. The sector information could also be used as a benchmark by firms to determine where they should focus their emission mitigation efforts.

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) which is widely adopted by the literature [6][7][8] . Here, we present the relation between the position of the value chain and the structure of value chain carbon footprints. Fig. S3| The relation between the degree of upstreamness and the structure of value chain carbon footprint. Notes, each point in Figure S3 represents a sector.  Mgmt., for example, has reduced its investments in coal mining and chemical industries but s9 increased its investments in electricity generation and transportation industries, which are also carbon-intensive industries. It is necessary to implement stricter measures to encourage asset managers to shift financial flows to low-carbon fields, such as increasing the risk weight of carbon intensive assets and discounting interest on green credit products. 2  ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri  ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri ri

Leading asset managers' equity portfolio investment in China's stock market
By using the shareholding information of asset managers and the market value of public companies in China, we analyze the market value of public companies in different industries held by the top five foreign asset managers and top ten domestic asset managers. The calculation results are presented in Table S1.