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220 global financiers holding $29.3 trillion in assets call on world’s highest-impact companies to set science-based emissions-reduction targets ahead of COP26; they are joined this year by 26 CDP supply chain member companies.
Financial institutions holding $29.3 trillion in assets are calling on the
world’s most impactful
to set science-based emissions-reduction targets through the Science Based
Targets initiative (SBTi) in line with 1.5°C warming scenarios, ahead of COP26
The 2021 CDP Science-Based Targets campaign, coordinated by
is signed by 220 financial institutions across 26 countries, whose
collective assets are worth more than the GDP of the United States,
China or the entire EU. It represents significant growth in support by
60 percent on last year, with an increase of 51 percent in assets behind
the call to action.
The group includes some of the world’s biggest investors and lenders —
Allianz, Amundi, Cathay Financial Holding Co, Credit Agricole, DWS
Group, Legal & General Investment Management, Insight Investment
Management, and Manulife Investment Management.
Joining the financial institutions in asking for SBTs this year are 26 CDP
supply chain members — large corporate buyers using CDP to optimize their supply
chains – including L’Oréal,
Renault Group, Bayer, AstraZeneca and HP
with $500 billion in annual procurement.
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They are pressing 1,600 companies to set emissions-reduction targets with SBTi
to ensure that corporate ambition is independently verified against the de-facto
industry standard for robust and credible climate targets. From
these must be aligned with a 1.5°C pathway to be approved.
“2021 has been a year when global financial institutions have committed en masse
to achieve net zero by
But these goals are impossible to achieve without the companies they lend to and
invest in having robust science-based targets that drive rapid decarbonization
in the entire value chain,” said Laurent Babikian, Joint Global Director
Capital Markets at CDP. “It is that simple; and when so many investors and
lenders are collectively saying the same thing, companies must act or risk
seeing their cost of capital rise.
“Not having an SBT raises a red flag that they are failing to manage climate
risk. Ahead of COP26, we must see greater ambition from the companies
accountable for the bulk of global emissions if we are to achieve a net-zero
emissions economy, and mitigate the most serious impacts of climate change,
which have been all too visible in 2021 so far.”
CDP sent the letter to over 1,600 companies worldwide, including Anhui
Conch Cement, China’s biggest cement manufacturer; Hyundai Motor Company,
Duke Energy, Associated British Foods, Nippon Steel, Tata Steel, Lufthansa and
The businesses targeted have a market capitalization of over $41 trillion, make
up 36 percent of the entire MSCI World Index, and account for 11.9 gigatons
of emissions (scope 1 and scope 2), equivalent to more than the annual total of
the US and EU, combined. Over 20 percent of companies by global market
capitalization are already part of the
Last year’s CDP Science Based Targets campaign contributed to strong momentum of
the number of companies joining the SBTi. 154 companies, with emissions
approximately equivalent to Germany’s annual total and a market
capitalization of $5.2 trillion, joined since this time last year. It
represents 8.1 percent of the companies targeted in this campaign last year. 56
percent of companies asked by CDP reported that the campaign had a direct
influence over their decision, while 96 percent reported that general investor
pressure led to them setting a target.
Globally, over 1775 companies are already part of the SBTi, among which over 550
have approved targets in line with 1.5°C.
has shown that the typical company with a target has cut emissions by 6.4
percent per year — well above the 4.2 percent linear reduction rate required to
meet the Paris agreement’s 1.5°C goal.
“Money talks, and this call from global financiers is loud and clear. A
decarbonized business model is the only sensible business choice for a
climate-safe and prosperous economy,” says SBTi Managing Director and co-founder
Alberto Carrillo Pineda. “The call for rapid decarbonization is clear, not
only from the scientific community, but also, from the financial community. We
are calling now on all companies to set science-based decarbonization targets
and for financial institutions to build on the leadership shown in these
campaign and to also set science-based climate targets for their investment and
lending portfolios. This is essential if we are to halve emissions by 2030 and
achieve net-zero before 2050 – and vital for the future of humankind.”
While companies can set science-based targets at any point throughout the year,
CDP will be engaging these companies to join the SBTi before September 2022,
when the impact of this campaign will be evaluated.
Published Sep 30, 2021 2pm EDT / 11am PDT / 7pm BST / 8pm CEST