More than $1 trillion could be raised if the planet’s most powerful corporations genuinely committed to safeguarding its future.
Or at least that’s the view of the World Benchmarking Alliance (WBA), the non-profit tasked with monitoring and measuring the contribution of major companies to sustainable development goals.
This is the first time large firms across all major sectors have been evaluated at such a scale, side-by-side. A significant milestone in global corporate accountability, although high spend on net zero was still rare, 23% of organisations in the study were now reporting on carbon-reducing investments with a median of more than 7% of total capital expenditure committed to this area.
Electrified transport, green ammonia and fertilisers, battery production, regenerative agriculture, renewable energy and low impact construction were among the most common initiates being adopted. Meanwhile, top giants across 19 individual sectors and a breadth of countries were found to be allocating 30% of budgets to climate solutions by moving investments away from environmentally damaging activities – for example building new combustion vehicles – to more climate-aligned options.
Although the $1.3 trillion that could be raised if the 2,000 most influential businesses on the planet still only represents 30% of the net zero investment needed to stay on track this year, analysts say that by setting a precedent these leaders could encourage others to follow suit. Overall, the firms have a combined revenue of $48 trillion, employ 107 million people, alongside a further 550 million in value and supply chains, and are responsible for 54% of global emissions.
Despite this clear responsibility, though, just 18% are working to reduce operational emissions at a rate that supports ‘1.5C sectoral pathways’ – the speed at which decarbonisation is needed to stand a chance of complying with internationally ratified agreements. Missed opportunities were also identified in nature and biodiversity.
For the 750 largest firms in the highest impact industries – like food, mining and paper production – a paltry 14% measured their dependence on ecosystem services. 34% could show evidence of trying to manage nature-related risks through biodiversity assessments, water re-use, resilient infrastructure and regenerative agriculture. And no more than 9% of these could quantify how associated threats would affect their business, finances or reputation. Although this was more than the 4% that were actuality assessing how healthier ecosystems could present opportunities for growth.
‘Our research shows a striking diversity in performance: while some companies are making impressive progress, too many continue to fall behind. In the midst of rising climate impacts, geopolitical tensions and economic uncertainty, companies still have a choice in how they respond,’ said Gerbrand Haverkamp, Executive Director of the World Benchmarking Alliance.
Our data makes it clear that progress is possible, and a growing group of companies are proving that meaningful action can be taken today,’ he continued. ‘But we also see signs of hesitation, with some companies backsliding or stagnating. That is why it is essential to look beyond corporate commitments and focus on actual emissions and investments.’
Read the full report here.
Image: Krisztian Matyas / Unsplash
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