“No big G7 stock index is aligned with Paris climate goals”:  Carbon Disclosure Project tells UN body


Corporations’ greenwashing of the rich world’s investors and their customers collided with hard numbers today, and shattered embarrassingly.

No major stock market among the seven biggest economies is aligned to any pathway limiting the planet’s temperature rise to even 2°C by 2100, much less the 1.5°C more urgently needed, researchers for corporate ecologists CDP found. The CDP used to call itself the Carbon Disclosure Project.

Worse, four of the seven biggest stock indexes are on dangerous temperature pathways of 3°C or above before the end of this century.

In Paris in 2015, global leaders pledged their nations to curb temperature hikes to at most two degrees by 2100.

CDP conducted the research on behalf of the Science Based Targets initiative (SBTi) and the United Nations’ Global Compact.

Any nation’s stock indexes with higher shares of emissions covered by science-based targets (SBTs) result in its corporations being recognised as inflicting lower – but still dangerous – temperature peril, CDP’s researchers reveal.

On Germany’s DAX30 index, for example, SBTs cover 71% of emissions made by the companies traded.  In consequence, Europe’s biggest economy returns the lowest temperature rating index for 2100, a still accord-busting 2.2°C.

Canada emerges as the planet’s bad boy. Fewer than 1% of companies traded on Toronto’s SPTSX 60 are covered by SBTs, resulting in a joint-highest temperature rating of 3.1 °C.

For the UK, SBTi welcomes that 35 firms on the FTSE 100 have already committed to align with 1.5°C.  But overall the FTSE is awarded a century-toasting temperature rise of 3.1°C, because too many of London’s largest emitters shy away from adequate climate targets, say the researchers.

Fossil fuels are a key contributor to the emissions of all seven indexes. They make up 70% of Canada’s SPTSX 60’s 3.1°C temperature rating, and in Italy almost 50% of the FTSE MIB’s 2.7°C rating.

Index CAC 40 DAX 30 NIKKEI 225 FTSE 100 S&P 500 FTSE MIB SPTSX 60
Country France Germany Japan UK USA Italy Canada
Temperature 2.7°C 2.2°C 3.0°C 3.1°C 3.0°C 2.7°C 3.1°C
% Index emissions covered by SBTs 41% 71% 12% 7% 16% 41% <1%

G7 heads of government have climate-linked financial reforms top and centre of their three days in Carbis Bay, starting today.  Their finance ministers and central bank governors met last week in London. This week, the UK Treasury appointed a team of tax and ecology experts, tasked to clamp down on greenwashing by corporations.

Zephyr Energy, an oil producer quoted on London’s AIM, this week told investors it could declare its operations in Utah and North Dakota carbon-neutral as early as September 2021, simply through the purchase, advised by UK-based refiner Prax Group, of carbon offset rights called VERs, or ‘Verified Emissions Reductions’. No implication is made here as to any improper conduct by any party.

Passive investing makes up 40% of US and 20% of European funds, says the STBi.  The study finds just 19% of listed companies in the seven biggest indexes have climate targets aligned with the Paris accords.

More on the SBTi/CDP report here.


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