The tCO₂e/t concept in the Carbon Border Adjustment Mechanism (CBAM) refers to the amount of CO₂ equivalent emissions generated per ton of a specific product. It is primarily used for carbon tax calculations and emissions certification. This metric serves as the basis for determining the number of CBAM certificates required and the carbon tax to be imposed on products exported to the EU. In contrast, while Climate Risk assessments also use the tCO₂e unit, the application scope and purpose are different. Instead of focusing on individual products, climate risk analysis evaluates carbon emissions at the company-wide, business unit, or investment portfolio level. This is done to assess financial risks, investment exposure, and long-term sustainability. A representative metric is Carbon Intensity (CI), which measures carbon emissions relative to company revenue or total assets. Formula (text format): CI = Total Emissions (tCO₂e) / Revenue or Assets For example, if a company emits 50 tCO₂e for every $1 million in revenue, the CI is 50 tCO₂e per $1 million revenue. In the financial sector, the PCAF (Partnership for Carbon Accounting Financials) standard is widely used to calculate the financed emissions of investment portfolios. Additionally, companies use scenario analysis to estimate Climate Value at Risk (Climate VaR), which quantifies potential asset value reductions due to rising carbon prices and climate-related financial risks. In summary, while CBAM uses tCO₂e/t for direct product-level carbon taxation, climate risk assessments apply tCO₂e metrics for indirect evaluations of financial risk and ESG disclosures. Even though the unit is the same, CBAM focuses on the product level, whereas climate risk focuses on the corporate or portfolio level.