World's largest companies failed to set climate targets
"Private firms are falling devastatingly short on net zero compared with their publicly-listed cousins,"
- John Lang, project lead of the Net Zero Tracker.
According to an analysis by the nonprofit Net Zero Tracker, privately owned companies are lagging behind their public market peers when it comes to setting climate targets.
According to a new study, only 32 of the world's 100 largest private companies have set a target to reach net-zero carbon emissions. This is compared with 69 of the 100 largest public companies.
In high-emitting sectors such as energy, infrastructure and manufacturing, only 14% of the private firms' annual combined revenue is covered by such a target compared with 77% of revenues from listed firms in the same sector. This means that private firms are not doing their fair share to reduce emissions.
The study found that the quality of targets for those that have them is also poorer, with firms less likely to include shorter-term goals, cover the full scope of their emissions or contain detail about how the firm uses carbon offsets.
Four private firms out of those with a target actually had a plan to deliver on their pledge, potentially exposing the companies - and the economies in which they operate - to greater risk as the world transitions to a low-carbon economy, according to the study.
As listed companies increasingly face mandatory climate-related disclosures, Thomas Hale, professor at Oxford University's Blavatnik School of Government, said there is a risk that private firms will escape scrutiny and gain an unfair advantage.
"Smart regulation is needed to create a level playing field and close a potentially enormous loophole in corporate climate action," he said.