While the number of companies vowing to achieve net-zero emissions by 2050 has grown in recent years, Chair of the steering committee for Climate Action 100+ (CA100+) François Humbert says that these pledges lack short term plans, particularly concerning capital expenditure.
With over 700 members managing a combined $68 trillion in assets, Climate Action 100+ is an “investor-led initiative to ensure the world’s largest corporate greenhouse gas emitters take necessary action on climate change.”
The organization describes itself as the “world’s largest investor engagement initiative on climate change.”
In its latest assessment report, CA100+ found that 77% of the world’s largest emitters have a net-zero target. This number was 75% last October and about 5% in 2017.
More than four-fifths of these firms have also set reduction targets for the 2036-2050 period, CA100+ found.
However, as Humbert points out in a conversation with Reuters, fewer than 20% of these top polluters have short-term emissions reduction targets that would make it possible to limit global heating to below 1.5 degrees Celsius compared to pre-industrial levels, as agreed in the Paris Agreement.
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“Urgent action is needed to shift the weight of focus from mere commitments to implementation. Although it’s encouraging to see more companies disclose their net zero transition plans, there’s a missing link between how these can meet the Paris Agreement goals,” Humbert said.
He adds that only 2% of these companies have plans to “phase out investments in unabated carbon-intensive assets by a specified year,” and that not a single one of the 32 upstream oil and gas companies consulted by CA100+ has capex plans that align with the 2015 Paris Agreement.
This revelation underscores the pressing need for more substantial commitments from corporate giants.
“Capex [capital expenditure] is the reality check, and it’s still behind. We want to move from commitments to action and it’s much more challenging to trigger action,” Humbert, who is also the Lead Engagement Manager at Generali Insurance Asset Management, told Reuters.
According to CA100+, in addition to short-term emissions targets and capex planning, corporate lobbying against climate policies is another a significant concern.
Editor’s Note: The opinions expressed here by the authors are their own, not those of Impakter.com — In the Featured Photo: Smoke from Chimneys. Featured Photo Credit: Manfred Langpap.