How we hold companies to account on their climate change plans
Recently there has been a huge up swell in corporate planning, activity and targets around climate change, which is a hugely positive development.
However, it is important that we evaluate how credible these plans are.
The first really important thing is to look at whether these are long-term objectives. For example, are they looking to become net zero emissions by 2050? Or are there near-term milestones, such as five-year targets and real measurements, that we can hold companies accountable to?
Secondly, we need the sources of those reductions. Are they coming from real improvements in the companies' operations or are they reliant on things such as carbon offsets? These can be important, but they are not the same as reducing those emissions at source from those companies.
So, when we hear about these plans from those companies, our approach is to really look at the real reductions the company is going to achieve in their climate change plans.
We can then evaluate what that means for investors and the companies' contribution to climate change.
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