Sector and Portfolio Reviews

All BeZero Carbon Ratings (BCR) are valid at all times and are monitored on an ongoing basis (full details on our ongoing monitoring process can be found here). This note expands on the monitoring process with a deep dive on ‘Sector or Portfolio Reviews’.

Portfolio reviews are an integral part of the continuous monitoring process carried out by BeZero. Such a review involves the simultaneous review of the ratings assigned to a homogeneous group of projects/credits, either at a sector/sub-sector or country level (as compared to a review of one or two projects at a time).

Portfolio reviews can be triggered by macroeconomic events such as changes in sector dynamics, changes in regulation (global or country specific) or incorporation of new elements of analysis applicable across a sector/sub-sector. Alternatively, it could be part of a periodic review process to reassess the appropriateness of the ratings in the context of updated methodology, sectoral developments and comparison of the rating across similar projects.

The reviews can last anywhere from a few weeks to several months, depending on triggers, project-specific factors, and rating committee unanimity.

If BeZero believes that a portfolio review may have an impact on the published ratings, none, some, or all ratings in the portfolio may be placed on ‘rating watch’ pending the completion of the full review.

This is particularly important as the portfolio review may involve a recalibration of the ratings across the portfolio. The review process will follow the usual process of peer reviews, rating committee discussions and decisions. BeZero will publish the resolution of the watch and updated ratings at the conclusion of the review process.