EVIC (Enterprise Value Including Cash) is the sum of a company’s market capitalisation (ordinary and preference shares), total debt and minority interests. It is its complete economic value, allowing emissions to be allocated among all providers of finance (shareholders and creditors). PCAF uses it as a denominator because it avoids double counting between equity and debt holders and remains more stable than market capitalisation alone. Note: EVIC moves with markets, so the same amount invested allocates fewer emissions when market capitalisation rises (denominator effect).
Read the source article: An investment fund's GHG emissions: the PCAF method