Questions & Answers

We are not affiliated with the Science-Based Targets Initiative (SBTi). However, many of our customers have joined the SBTi and have defined climate targets that fulfil SBTi requirements. Our software can help these companies to plan, track, and steer their progress towards such a target.

We firmly believe that you know the situation, market, opportunities, and constraints of your business best. We do not prescribe pre-defined measures or technology pathways that must be followed to comply with a certain standard.
Instead, our metrics and tools are designed to put you in the driver’s seat. Use them to create a credible, science-based climate strategy by assessing your current temperature trajectory (Temperature Alignment) and how future investments and plans would impact it.

Our software can help you map a Paris-aligned path from where you stand today to where you want to be at a particular point in the future, including at Net Zero in a certain year.
It can help you identify those areas within your operations that are / are not on track for that goal and to evaluate how certain investments or business decisions would affect your trajectory.
Based on that, you can determine which changes to e.g. your business model, your products, your supply chain, or your energy sources are right for you.

We are a for-profit company, working mainly for customers from the real and financial economy (companies from various industries, banks, investment firms etc.).
right° was founded out of the firm belief that there is value in helping businesses and financial market participants understand their climate impact and steer their operations to align with the 1.5°C goal – thereby reducing material risk and ensuring their long-term license-to-operate.

X-Degree Compatibility (XDC) analysis is the next step, once an entity’s carbon footprint has been established (i.e. its Scope 1, 2, and 3 emissions). We believe this is a step worth taking because:
Emissions measured in tCO2 or tCO2e (CO2 equivalents) values are hard to grasp and to visualise. The actual impact they will have on climate change is not immediately clear. A °C metric is tangible, easy to understand and directly relates to the common goal the world’s leaders set out in the Paris Agreement: to keep global temperature rise to 1.5°C or, at least, well below 2°C.
A carbon footprint is usually backward-looking and is therefore difficult to use for steering. The XDC Model is forward-looking, applying scenario-based assumptions to project trajectories from a base year until 2100. It can also be used to calculate various different scenarios, e.g. to compare a ‘business as usual’ and a ‘high growth’ scenario.

Using Gross Value Added to determine the Economic Emissions Intensity of a company (or portfolio of companies) has three main advantages:

1. GVA is to a company what GDP is to a country. The EU Green Deal calls for the decoupling of economic growth (GDP) and natural resource use. By using GVA in relation to emissions, we are applying this same logic.
2. GVA speaks the language of businesses and the real economy. This is important because that is where the emissions reductions need to happen.
3. Since Global GVA is a fixed sum (published annually by the World Bank), it can be used to scale a single entity’s emissions intensity to a global level, thereby answering the question: What if everyone behaved as this entity does? This creates comparability between companies of different sizes & regions and is a crucial component of robust net-zero plans.

In theory, this is correct. If GVA grows while emissions remain constant, the XDC falls.
However: In our experience, translating this calculation to reality is a great challenge for companies – one that requires new approaches to operations, production, sourcing, distribution etc. In other words: it requires companies to find new ways of creating value without growing emissions.

So far, the XDC Model is focused exclusively on global warming and emissions (CO2e).
Approaches to integrate further sustainability factors are being explored within our research project right. open, where we collaborate with academic researchers to further evolve and improve the XDC Model.

The input data for our calculations varies, depending on the type of entity under consideration.

1. For companies, single equities, bonds, and loans: GVA (EBITDA & personnel costs) and emissions (scopes 1-3; CO2e) from the same base year.
2. For portfolios of equities, bonds or loans: ISINs for all securities in the portfolio and their portfolio weights.
3. For Sovereign Bonds: A list of required countries. (Emissions Intensity here is measured as CO2e/capita).
4. For Real Estate: Gross internal area; emissions (whole-buildings approach & fugitive emissions, if applicable); building use; country; base year.

We cover all direct and indirect emissions in scopes 1, 2, and 3 according to the Greenhouse Gas Protocol. This includes carbon dioxide as well as other greenhouse gases, such as nitrous oxide, methane, and F-gases, measured in CO2 equivalents (CO2e).

Our emissions data provider is Urgentem.
Our GVA data provider is FactSet Research Systems.
Customers requesting an XDC Climate Impact Report or using the XDC Scenario Explorer can also use their own data and assumptions to conduct their analysis.
We also work with partner such as Stakeholder Reporting to support companies who do not yet have any or all required emissions data.

We work with data from a third-party data provider who fills data gaps when reporting is incomplete. When we receive the data, we run additional plausibility checks ourselves. Data that companies submit to us is benchmarked against sector averages to make sure we spot gaps and ensure reliability.
Our XDC Model team is currently working on uncertainty quantification to eventually make data from different sources comparable.

We include 100% of Scope 1 (direct) emissions and 50% of Scope 2 and Scope 3 (indirect) emissions to account for double counting in the latter two categories.