Climate Action 100+ progress report records accelerated company commitments to net-zero emissions but gaps remain
Almost half the focus companies of Climate Action 100+ – the world’s largest ever investor engagement initiative on climate change – have now established commitments to reach net-zero emissions by 2050 or sooner, its latest progress report reveals.
The Climate Action 100+ 2020 Progress Report also outlines the significant growth and evolution of Climate Action 100+. There are now 545 investor signatories, responsible for over USD52 trillion in assets under management and engaging with 167 companies through the initiative.
But despite the significant growth in signatories and net-zero commitments, the report details ongoing gaps in target coverage, with only a small proportion of net-zero goals including the companies’ most material indirect (known as Scope 3) emissions.
The report details sector-level progress for the focus companies that are engaged by investors through Climate Action 100+, which comprises of the world’s 100 largest corporate greenhouse gas emitters and over 60 more who are critical to accelerating the transition to net-zero emissions. Company-level progress against the goals of the initiative will be reported in the first quarter of 2021 under the recently announced Climate Action 100+ Net Zero Company Benchmark.
Overall, the Climate Action 100+ 2020 Progress Report finds:
- 43 per cent of the initiative’s focus companies now have goals or commitments for net-zero emissions by 2050 or sooner in some form. While 51 per cent also have short-term emissions reduction targets (to 2025) and 38 per cent have medium-term targets (2026-2035).
- Just 10 per cent of focus companies have net-zero targets that include coverage of their most material Scope 3 emissions.
- 26 per cent of electricity utility companies on the initiative’s focus list have coal phaseout plans that are consistent with the Paris Agreement goals (up from 13 per cent in 2019).
- 194 new oil and gas projects sanctioned by focus companies this year are misaligned with the Paris Agreement goals. Further, 68 per cent of planned oil and gas capital expenditure was also inconsistent with these goals.
- Automotive focus companies are still largely falling short of the investment required to switch technologies at an appropriate pace from internal combustion engines to hybrid and electric vehicles.