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Firms’ Climate Plans Inadequate, Inconsistent – MSCI

A new analysis said listed companies’ climate strategies will use up their collective carbon emissions budget by December 2026 and put the world on pathway to 2.9°C of climate warming by 2100. Index and data provider MSCI’s latest quarterly Net Zero Tracker said this is two months earlier than previous estimates, driven by an expected 1% increase in Scope 1 greenhouse gas emissions compared with 2021. Sixteen percent of listed companies align with keeping global warming at or below 1.5°C, while one-third align with keeping global warming at or below 2°C. MSCI also noted a high level of variation between decarbonisation plans, with some targets aiming to balance emissions with carbon removal, while others plan to reduce only direct, not supply chain emissions, and still others focusing on increased use of energy from renewable sources. Only 41 companies in the Net-Zero Tracker – a quarterly gauge of 9,300 public companies climate change progress based on the MSCI All Country World Investable Market Index – have set a net-zero target approved by the Science Based Targets initiative, with 577 companies’ targets pending.

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