Only seven firms have told investors how they will meet net-zero goals

Update from major shareholder body highlights ongoing struggle around green investment planning

Just seven of the most important publicly-listed carbon emitters have told their shareholders how they plan to meet their medium- and long-term climate goals. 

The latest assessment by the investor network Climate Action 100+ shows an increase in the number of firms providing details on the actions, levers, offsets and abatement measures they will use to meet their GHG reduction targets, but the total still sits below 5%. 

Of the 150 companies assessed, only seven give quantified plans – up from four last year. 

CA100+’s annual benchmark provides an overview of how the listed companies its 600+ members engage with have progressed each year. It does not name any firms. 

The report noted companies are becoming more transparent about how they are allocating capital to the transition – although that uptick still amounts to just three of the 150 explicitly stating they will, or already have, phased-out spending on new, unabated carbon-intensive assets or products. 

The proportion disclosing the amount of capital expenditure being spent on such projects increased by 19%, driven largely by the energy sector. 

Over a third of those assessed (55 out of 146) now disclose how much of their capex is allocated to climate solutions, and almost the same amount (54) disclose how much they intend to allocate in the future. 

Companies ‘weakest’ on green investment planning

Earlier this month, Kepler Cheuvreux analysed the net-zero strategies of 423 companies in the Stoxx Europe 600 and concluded that “decarbonisation investment planning tends to be the weakest point”. 

The French financial services house identified 45 “best performers”, including Burberry, Royal Unibrew,  Logitec, Inditex and Philips. They were accompanied by a number of utilities and telecom businesses, among others. 

In order to qualify as a leader, a firm needed to have an explicit net zero target, including a 6.5% absolute or 10% intensity annual reduction rate for its Scope 1 and 2 emissions by 2030 and a 4.5/7.5% equivalent for its Scope 3 by 2035. 

“Overall, 222 companies had Scope 1 and 2 targets by 2030, a Scope 3 target by 2035 and a net-zero target by 2050,” said Kepler, adding that this fell to just 45 when the above thresholds were applied. 

Amongst the leaders, just 19 had official green spending commitments.

They ranged from 7% of research and development budget (Schindler), to plans to align half of capex with the EU taxonomy by 2025 (Volvo Cars). 

Most firms expressed them as an absolute figure: £1bn each from AstraZeneca, Diageo, GSK, Reckitt Benckiser, Sainsburys and Unilever, rising to tens of billions for the utilities on the list. 

In March, Real Economy Progress reported that the French regulator AMF had found the information required about financial resources to be “the most difficult” part of the European Sustainability Reporting Standards that underpin the EU’s new corporate disclosure rules.

“A large majority of issuers reported, through the questionnaire or interviews conducted, difficulties in determining the budget or investments required to meet the objectives of the transition plans,” AMF said at the time.