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Published December 6, 2021
Only a third of large companies have set targets for cutting carbon dioxide emissions from their supply chains, according to research.
While the research shows publicly traded companies have significantly strengthened net zero targets in the last year, the majority have yet to shift away from broad pledges towards short-term, rigorous commitments.
The research from Net-Zero Tracker examined the net zero targets of 632 of the world’s largest companies by revenue that have set net zero targets. The analysis shows leaders must shift ‘from quantity to quality’ target-setting to operationalise the Glasgow Climate Pact signed at COP26.
Only 32% of corporate net zero targets cover the entirety of Scope 3 emissions, the research shows. Furthermore, 25% of targets only partially cover Scope 3.
The picture is much brighter for Scope 1 and 2 emissions. The research shows 76% of major public companies have captured direct emissions (Scope 1), plus the in-direct emissions from purchased power (Scope 2) in their net zero plans.
Furthermore, the number of companies setting net zero targets meeting ‘minimum procedural standards’ have almost doubled in the last year (from 110 to 207). The rise as measured by revenue has been even more dramatic: from $2,148bn to $8,049bn.
However, while 43% of the 632 firms plan to use offsetting, nearly half of public companies (48%) fail to specify if or how offsets will be used in net zero plans, 66% of these plans do not specify any conditions on the use of offset credits.
Companies meeting both minimum standards and leadership practices has doubled in the last year by number, from 11 to 22, and increased 16-fold (from $82bn to $1,345bn) as measured by revenue.
Tags carbon emissions COP26 Net Zero Scope 1 Scope 2 Scope 3