In its first ever Net Zero Company Benchmark of the world’s largest corporate emitters, Climate Action 100+ defines key indicators of success for businesses to align with a net zero emissions future and the goals of the Paris Agreement.
While there is growing global momentum around companies making ambitious climate commitments, the Benchmark assessments show that companies still have a long way to go in delivering on these promises. Further, the assessments show that no company has fully disclosed how it will achieve its goals to become a net-zero enterprise by 2050 or sooner, including short and medium-related targets for the next decade.
Launched in 2017, Climate Action 100+ is the world’s largest investor engagement initiative on climate change. More than 570 investors, responsible for over $54 trillion in assets under management, are engaging companies on improving climate change governance, cutting emissions and strengthening climate-related financial disclosures. The initiative, supported by a global Steering Committee, is coordinated by five regional investor networks: the Asia Investor Group on Climate Change (AIGCC), Ceres, Investor Group on Climate Change (IGCC), Institutional Investors Group on Climate Change (IIGCC) and Principles for Responsible Investment (PRI).
The Benchmark offers the first detailed, comparative assessments of focus company performance against three high-level commitment goals:
- Reducing greenhouse gas emissions;
- Improving governance; and
- Strengthening climate-related financial disclosures.
Specifically, the company assessments reveal that:
- Alignment of value chain GHG (Scope 3) emissions often remain a blind spot.
- Long-term ambitions need to be backed by clearer strategies and robust short-and medium-term targets.
- Future investments need to be more clearly aligned with the net-zero transition.
- Corporate boards and executive management teams need to improve climate change governance.
- Ambitious 1.5-degree pathways are often missing from climate scenario planning.
Leading climate research and data organizations, including Transition Pathway Initiative (TPI), Carbon Tracker Initiative (CTI), 2° Investing Initiative (2DII) and InfluenceMap (IM) have been central to the overall development of the new Benchmark and the indicators used to assess focus company alignment with the initiative’s goals. TPI conducted the company disclosure research and analysis, supported by its research and data partners the Grantham Research Institute on Climate Change and the Environment at the London School of Economics (LSE) and FTSE Russell. The Benchmark was undertaken through the leadership and support of the Climate Action 100+ Steering Committee, and the collaboration of investor signatories and experts from AIGCC, Ceres, IIGCC, IGCC, and PRI.
Over the coming months, Climate Action 100+ will build on the company assessments released by publishing sector-by-sector analyses. The Benchmark will continue to evolve as a key measure of corporate progress on climate action and net-zero alignment and will be updated and revised with the latest available data, and stakeholder input and feedback. The next iteration of the Benchmark will be published in 2022.