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Vetting Process

April 1, 2021

iClima Earth


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The process of selecting the companies in Clima’s universe started with identifying the activities that can decarbonise the planet. We used as reference, among others, the 100 solutions that can decarbonise the planet as defined by Project Drawdown, in triangulation with the EU Taxonomy recommendations by the Technical Expert Group (TEG). Each company is vetted based on a revenue test, to ascertain relevance and materiality of the climate change solutions. To accomplish this, the revenue of each company is analysed according to the maximum amount of breakdown of the revenue lines. Additional information from Investor Relations can potentially be used, as our goal is to estimate the percentage of total revenues that are directly related to the products and services previously identified as those that can enable CO2 avoidance.

In a next step, companies are classified into four categories: Pure Player, if green revenue is above 90%; Majority Player if green revenues are between 50% and 90%; Partial Player if revenues are between 20% and 50%; and Upcoming Player if revenues are below 20% but the green revenue line is observing double digit annual growth. Companies are also subject to a negative screening test where rules define activities that our “climate champions” cannot be exposed to. The flow chart above summarises this process.

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