Burgiss and MSCI Update the Net-Zero Tracker

While nearly half (44%) of public companies globally now have a climate reduction commitment, they are still on track to emit 11.2 gigatons of direct Scope 1 greenhouse gas emissions, unchanged from 2022. This is according to the latest edition of MSCI’s Net-Zero Tracker, a periodic report on climate change progress created in combination with Burgiss’ data and research. This report helps investors digest the impacts of increasing climate regulations and voluntary commitments, and to measure private assets’ carbon footprint and exposure to climate risk.

In private assets, where data tends to be more opaque, carbon footprint estimates from Burgiss and MSCI provide climate transparency and allow investors to compare between listed and unlisted assets. Unlisted companies in the five most emissions-intensive industry groups are less carbon intensive than their listed counterparts. This could be attributed partly to differences within sectors. The three most carbon intensive sub-industries within the energy sector account for 26% of the holdings valuation in the sector (as of Sept. 30, 2022). Whereas in the public markets, these sub-industries accounted for 85% of the broader sector’s market capitalization.

Key takeaways:

• Nearly half of global public companies have now set a decarbonization target, but only 17% of those targets would align with the 1.5°C temperature rise goal.

• Listed companies’ global emissions budget for limiting temperature rise to 1.5°C is set to deplete by October 2026.

• Analysis of global private companies shows they have lower carbon intensity than their public counterparts.

To learn more about how companies are measuring and managing climate transition risks, you can download the latest report here, or read the highlights in the press release.