The MSCI Net-Zero Tracker | Oct 2022

The MSCI Net-Zero Tracker indicates the collective progress of the world’s listed companies toward keeping global temperature rise this century within 1.5°C of preindustrial levels, the threshold above which scientists say the risk of catastrophic climate hazards increases significantly.

Here are some key findings from October’s tracker:

• Listed companies are on track to warm the planet 2.9° C by the end of the century, the same as we projected in June 2022.
   
• Sixteen percent of listed companies align with keeping global warming at or below 1.5°C.
   
• Listed companies are on track to put 10.9 gigatons (billion tons) of direct Scope 1 greenhouse gas emissions into the atmosphere this year, up about one percent from 2021 but down 4.4% from their pre-pandemic high.
   
• We estimate that listed companies will use up their share of the global carbon budget for keeping temperature rise below 1.5°C by Dec. 31, 2026.
   
• Companies that together represent 64% of global greenhouse emissions rely on carbon offsets to achieve their net-zero goals.
   

Not all net-zero targets are created equal.

Investors who align their strategies with a 1.5°C decarbonization pathway increasingly expect companies to target net-zero emissions by 2050 before they will consider investing. 

Self-declared corporate net-zero targets vary broadly. Some aim to balance carbon emissions with carbon removal. Others plan to reduce direct emissions but not those from the company’s suppliers or customers. Some intend to simply boost the company’s use of energy from renewable sources.
 

Source: The MSCI Net-Zero Tracker