38% of the world’s largest companies have set a target for significant climate action by 2030, up 8% from last year, according to the latest report into the Fortune Global 500 from Natural Capital Partners.
The report, which is the third annual analysis of the commitments to carbon neutrality, net zero, 100% renewable energy and Science-Based Targets, found that there has been a three-fold increase in net zero targets, 50% increase in the number of companies that have either achieved carbon neutrality or are targeting it by 2030, and a 25% increase in Science-Based Targets.
But still more than 60% of companies in the Fortune Global 500 are not committed to deliver a meaningful climate milestone by 2030 the report, ‘Reality Check’, found.
With the latest UN synthesis report finding that governments’ commitments under the Paris Agreement (Nationally Determined Contributions), mean greenhouse gas emissions will be 16% higher in 2030 than they were in 2010, the need for private sector action to close that gap continues to be critical. To limit the average temperature rise to below 1.5 degrees Celsius, emissions need to fall by 45% by 2030.
“This is the time to step in and step up,” says Vaughan Lindsay, CEO of Natural Capital Partners. “We know we need to halve emission by the end of this decade to stand any chance of reaching net zero, so we need to use all the solutions available to make an impact. Internal reductions are essential but leading companies are going beyond their own boundaries to finance the projects that are reducing emissions all over the world. It is through those projects that we’re building the sustainable infrastructure and restoring the forests and ecosystems which ensure everyone benefits from a low carbon transformation and a thriving planet.”
“Even though COP was delayed and there is concern about its success in Glasgow, companies are increasingly challenging themselves to step up ambition on urgent climate action. This is a race we all have to win or the whole of society and the planet loses,” says Zelda Bentham, Group Head of Sustainability at Aviva plc, a Fortune Global 500 company.
Net zero targets haven risen significantly in the last year, reflecting a rising tide of corporate climate awareness. The report has broken those targets into two types: ‘Responsible’, 71 companies, if the target date aligns with the government target for net zero in the country where they are headquartered, or the 2050 target date of the Paris Agreement; or ‘Leadership’, 30 companies, if the company’s target date is accelerated ahead of a national target or 2050.
“To mitigate the effects of the growing climate crisis and meet the world’s Net Zero targets, we must unite with a common commitment to take aggressive, science-based action in line with 1.5 degrees Celsius,” says David Eichberg, Head of Climate Strategy, HP Inc, a company listed in the Fortune Global 500. “The acceleration of corporate climate ambitions highlighted in the report sends a powerful and positive signal of leadership to investors, customers and suppliers, and it is essential that this leadership cascades across the entire value chain.”