The headline news from our Sustainability Reporting Performance reports this year was that corporate action on climate change is simply not happening fast enough. While this is sadly true, the purpose of our research is not to simply cast another cloud over the climate crisis. The objective is really to recognise the action that is being taken, share knowledge and provide inspiration that change is possible in the hope that this helps to drive more climate action.
Positive trends in sustainability
With that in mind, here are some of the encouraging trends we found across our international research into companies from the FTSE 100, CAC 40, IBEX 35 and DOW 30 companies.
- The large uptake of the TCFD – since their release in 2017, the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) have been transforming the sustainability reporting space. Our report this year revealed that across all indices in the study, the number of companies committing or beginning to align to the recommendations has soared. More companies are embracing risk assessment and climate-related financial disclosures and recognising the importance of doing so.
- Companies are already starting to embrace more ambitious targets as recommended by the IPCC just a year ago. Even though the Science Based Target initiative (SBTi) only updated its guidelines for SBTs to well below 2 degrees or 1.5 degrees in April in order to officially come into effect in October, some companies are already setting these more ambitious targets.
- Everyone is talking about net zero – in case you hadn’t noticed “Net Zero” has mainstreamed. This year we reported that, although very small in number, more companies are making their net zero (or carbon neutral) commitments. It is still not near enough yet, but as net zero legislation is beginning to arrive, we are optimistic that more companies will be compelled to ready themselves for a low carbon future.
- Renewables are going from strength to strength – year on year we have reported that renewable energy use and generation within companies is rising. This year is no exception and in the DOW 30 it is up to 97% of companies powering at least part of their operations with renewable energy.
- Consumer facing companies are supporting climate action – FMCG Energy, Water & Multiutilities and the ITT sectors have been called out this year for high performance in sustainability reporting. In particular, these companies are meeting the demand from their increasingly aware consumers and bringing to market low carbon and even carbon neutral products and services. Ultimately, they have recognised that climate action can present opportunities for their businesses.
Inspiration from four corners of the globe
At the EcoAct events in New York, London, Paris and Madrid to launch our annual research, we heard from some of the companies leading in sustainability. From them we gained stories of success and some encouraging evidence that ambitious climate action is possible and good for business.
Starting our day of events, Maya Ormazábal, Director of Environment and Climate Change at Telefonica, joined us for our launch of the IBEX 35 report in Madrid. Telefonica scored very highly in our international research and Maya explained that for the team at Telefonica climate-related sustainability is not just a trend, it represents a real change and an opportunity. This is an encouraging sign of big business taking climate seriously and looking at ambitious action as a business positive.
Meanwhile in Paris, the leader in our CAC 40 research, Danone, was at the launch event for the CAC 40. Christian Didier, Nature & Sustainability Finance Director, told us that because Scope 3 emissions represent the majority of Danone’s emissions, it is crucial for the company to focus on supply chain and awareness-raising with their customers. This requires working closely with suppliers and getting involved in the processes. Danone committed to carbon neutrality by 2050 four years ago, so is ahead of the curve in terms of their climate ambitions. In addition to this, they support the Business for Inclusive Growth initiative and are committed to driving change throughout their sector. This is a great example of business taking responsibility for their wider impacts and stepping ahead with bold action.
This year Unilever topped both the FTSE 100 ranking as well as the ranking across all four indices within our research demonstrating their impressive dedication to climate-related sustainability. We were lucky enough to have Jonny McCaig, Global Reporting Director, on our panel in London discussing the positive impacts and the drivers behind Unilever’s leading sustainability strategy. The company’s reputation on ambitious sustainability commitments is well known and they are seeing this to be a big draw for potential employees. People increasingly want to work for responsible and sustainable companies, and this is a powerful driver for positive change in business.
At the DOW 30 report launch during Climate Week in New York, Scott Tew from Trane (and parent company Ingersoll Rand) talked about the company’s incredible target to reduce emissions by 1 gigaton by 2030. This is the largest commitment of any B2B company and amounts to the equivalent annual impact of the UK, Italy and France combined! He entreated all businesses to be bold with their ambitions and said that nothing has engaged their workforce more than this, their most ambitious climate target.
To learn more about the trends in sustainability reporting across the FTSE 100, DOW 30, CAC 40 and IBEX 35, and to find out exactly what the business leaders are doing, download our report below.