ABOUT THE COMPANY ASSESSMENTS
The Net Zero Company Benchmark assesses the performance of focus companies against the Initiative’s three high-level goals: reducing greenhouse gas emissions, improving governance, and strengthening climate-related financial disclosures. The Benchmark contains two types of analyses, a Disclosure Framework and Alignment Assessments, which complement each other and provide insight into a company’s net zero emissions transition.
By accessing these assessments, you agree to be bound by the data usage terms and conditions. For more information on data collection and feedback, see the review and redress process.
EXPLORE THE ASSESSMENTS
The disclosure framework evaluates the adequacy of corporate disclosure in relation to key actions companies can take to align their businesses with the Climate Action 100+ and Paris Agreement goals. The framework reflects publicly disclosed information as of 13th May 2022 and is assessed by the Transition Pathway Initiative. Download the disclosure framework methodology to learn more.
This Sub-indicator is based on TPI’s carbon performance methodologies.
When no explicit long term target that TPI can assess is available, the latest available data point of the company’s transition pathway is used to determine long term alignment. For example, a company with a 2030 target but no targets thereafter will have its 2030 data point compared with the benchmark value in 2050.
This company is assessed against TPI’s 2°C Scenario (high efficiency), which is the best available for the auto sector. The intent is to assess all companies and sectors against a 1.5 degrees IPCC P1 scenario or equivalent, as and when the necessary data becomes available.
This Sub-indicator is based on TPI’s Carbon Performance methodologies which apply the Sectoral Decarbonisation Approach.
When no explicit medium term target that TPI can assess is available, the latest available data point of the company’s transition pathway is used to determine long term alignment. For example, a company with a 2030 target but no targets thereafter will have its 2030 data point compared with the benchmark value in 2050.
This company is assessed against TPI’s 2°C Scenario (high efficiency), which is the best available for the auto sector. The intent is to assess all companies and sectors against a 1.5 degrees IPCC P1 scenario or equivalent, as and when the necessary data becomes available.
This Sub-indicator is based on TPI’s carbon performance methodologies which applies the Sectoral Decarbonisation Approach.
When no explicit short term target that TPI can assess is available, the latest available data point of the company’s transition pathway is used to determine long term alignment. For example, a company with a 2030 target but no targets thereafter will have its 2030 data point compared with the benchmark value in 2050.
This company is assessed against TPI’s 2°C Scenario (high efficiency), which is the best available for the auto sector. The intent is to assess all companies and sectors against a 1.5 degrees IPCC P1 scenario or equivalent, as and when the necessary data becomes available.
Indicator 5 is sector neutral, assessing the key elements that should comprise any company decarbonisation strategy. See sector-specific expectations in the Climate Action 100+ Global Sector Strategies. Implementation approaches will be adapted regionally.
Offsets are now explicitly referred to in the methodology for Sub-indicator 5.1, which asks that any decarbonisation strategy “clearly identifies the set of actions the company will implement to achieve its decarbonisation targets (such as phasing out carbon intensive products or assets, developing or deploying low carbon technologies, decarbonising supply chains or using offsets).” Offsets will be an area for future development in the Net Zero Company Benchmark.
Examples of key elements include: changing technology or product mix, supply chain measures, R&D spending, etc.
Clarifications for meeting the requirements of Metric 5.1b have been added since the March 2021 iteration of the Net Zero Company Benchmark. In order to be assessed as “Yes” on this Metric in the March 2022 and October iterations, companies must quantify the approximate proportion of emissions reduction each action in their decarbonisation strategy will contribute to their overall greenhouse gas reduction target. Some year-on-year scoring changes are therefore anticipated. For more details, see the 2022 Disclosure Framework assessment methodology.
Currently Sub-indicator 5.2 and related Metrics only apply to focus companies headquartered on the European continent.
The assessment will leverage the European Union’s Green Taxonomy criteria on ‘turnover’ (or revenues) for companies headquartered in the European Economic Area or United Kingdom. The criteria used to assess non-European companies will be an ongoing area of development as part of broader discussions on the use of green revenue classification systems and regional taxonomies.
Clarifications have been added to Metric 6.1a to enable assessment of companies’ plans to phase out carbon intensive assets. Some year-on-year changes are therefore anticipated.
Clarifications have been added to Metric 6.1b to enable assessment of companies’ plans to phase out carbon intensive assets. Some year-on-year assessment changes are therefore anticipated.
Contingency: Metric 7.3b cannot be ‘Yes’ unless Metric 7.3a is also ‘Yes’.
The company discloses evidence of board or board committee oversight of the management of climate change risks via at least one of the following:
• There is a C-suite executive or member of the executive committee that is explicitly responsible for climate change (not just sustainability performance) and that executive reports to the board or a board level committee, and/or;
• The CEO is responsible for climate change AND he/she reports to the board on climate change issues, and/or;
• There is a committee (not necessarily a board-level committee) responsible for climate change (not just sustainability performance) and that committee reports to the board or a board-level committee.
The company has named a position at the board level with responsibility for climate change, via one of the following:
• A board position with explicit responsibility for climate change, or;
• CEO is identified as responsible for climate change, if he/she sits on the board.
Beta = data collected, but not publicly assessed. Subject to change in future iterations of the Benchmark.
Contingency: Metric 10.2b cannot be ‘Yes’ unless Metric 10.2a is also ‘Yes’.
Notes
Stellantis NV is the result of a merger between Peugeot and Fiat Chrysler (both previous Climate Action 100+ focus companies assessed by the Benchmark). This merger concluded in January 2021. All future engagement and benchmarking will focus on the merged company, Stellantis.
Alignment Assessments (formerly called Capital Allocation Assessment Indicators) complement the Disclosure Framework. They provide independent evaluations of the alignment and adequacy of company actions with the goals of Climate Action 100+ and the Paris Agreement.
These alignment assessments from the Rocky Mountain Institute (RMI) are made using the PACTA methodology and data provided by Asset Resolution. They analyse automotive companies’ planned capital expenditures (CAPEX) and production output for the coming 5 years relative to a range of climate change scenario pathways for the sector. The assessments give investors insights on the relative adequacy and alignment of company actions with the Paris Agreement goals. These assessments reflect the company’s physical assets and production plans as of 31 June 2022. Download RMI’s auto assessment methodology to learn more.
ASSESSMENT OF THE COMPANY’S Q2 2022 TECHNOLOGY MIX VS. THE Q2 2022 SECTOR AVERAGE
- Green—The company is ‘Ahead’ or ‘Slightly Ahead’ of the sector average.
- Amber—The company is ‘Aligned’ with the sector average.
- Red—The company is ‘Behind’ or ‘Slightly Behind’ the sector average.
ALIGNMENT OF THE COMPANY’S 2026 PRODUCTION FORECASTS FOR EACH TECHNOLOGY COMPARED TO INTERNATIONAL ENERGY AGENCY (IEA) SCENARIOS.
- Green—The company’s production trajectory is below (<5%) or significantly below (<15%) the target for the NZE<1.5°C (where ‘NZE’ is the IEA’s Net Zero by 2050 Scenario).
- Amber—The company’s production trajectory is aligned with the target for the NZE<1.5°C .
- Red—The company’s production trajectory is above (>5%) or significantly above (>15%) the target for the NZE<1.5°C.
ASSESSMENT OF THE COMPANY’S AGGREGATE IEA SCENARIO ALIGNMENT
- Green—The company is ‘Ahead’ or ‘Slightly Ahead’ of the NZE target technology production for the utilities sector.
- Amber—The company is ‘Aligned’ with the NZE target technology production for the utilities sector.
- Red—The company is ‘Behind” or ‘Slightly Behind’ the NZE target technology production for the utilities sector.
This assessment shows how the company’s present mix of vehicle technologies compares with the sector average for each technology. The analysis is conducted on the technology level, meaning RMI compares the technology share of the company with the technology share of the global sector average. The assessment is based on whether the company’s technology mix is ahead of the market in terms of a decrease in ICE production or an increase in hybrid and EV production. For more information on how the sector average is calculated see the methodology document.
Possible assessment outcomes include: Behind (>15% negative deviation); Slightly Behind (5-15% negative deviation); Aligned (+ or – 5%); Slightly Ahead (5-15 % positive deviation); or, Ahead (>15% positive deviation). For example, if the market’s technology mix consists of 80% ICE’s, while the company’s technology mix consists of 60% ICE’s, then the company is ‘Ahead’ of the market (>15% positive deviation from the sector average), implying that it’s greener than the market. Similarly, if the market’s technology mix consists of 15% electric vehicles, and a company’s technology mix consists of 10% electric vehicles, then it’s ‘Behind’ the market (>15% negative deviation from the sector average).
This assessment shows the company’s planned contribution to the transition towards low carbon vehicles for the coming 5 years, in relative terms for various technologies. The assessment evaluates the company’s automotive production plans with IEA scenarios and identifies the scenario pathway to which it most closely corresponds per technology.
The “aggregate scenario alignment of the company” is calculated for the IEA’s Net Zero by 2050 Scenario (NZE) based on a weighted average alignment across all technologies. The weighting uses a combination of: (i) the company’s target production per technology (i.e., the relative importance of the technology to the company); and (ii) the target change in capacity per technology calculated based on the NZE between Q2 2022 and 2026 (i.e., based on the relative importance of the technology in the scenario). Companies’ trajectories for each technology are assessed against target values for the scenario. The result is assessed based on the degree of alignment with the IEA’s NZE (NZE<1.5°C).
These assessments from Carbon Tracker Initiative (CTI) and the Climate Accounting and Audit Project (CAAP) evaluate whether a company’s financial statements and related disclosures, and the auditor’s report thereon, reflect the financial effects of climate risk and the global move onto a 2050 (or sooner) net zero greenhouse gas emissions pathway and the Paris Agreement goal of limiting global warming to no more than 1.5°C. The financial statements reviewed are as of 31 December 2021. Download CTI and CAAP’s Climate Accounting and Audit assessment methodology to learn more.
This assessment is provisional, meaning that information will be collected and publicly assessed as part of the October 2022 Benchmark Assessments, but the assessment framework will be subject to change in future iterations.
Green—At the overall Indicator level, the company receives a ‘Yes’ on all Sub-indicators and Metrics that make up the indicator. At the Sub-indicator level, the company receives a ‘Yes’ on all Metrics that make up the Sub-indicator.
Amber— At the overall Indicator level, the company receives a ‘Yes’ on at least one Metric that makes up the Indicator. At the Sub-indicator level, the company receives a ‘Yes’ on at least one Metric that makes up the Sub-indicator.
Red—At the overall Indicator level, the company receives a ‘No’ on all Sub-indicators or Metrics that make up the indicator. At the Sub-indicator level, the company receives a “No” for all Metrics that make up the Sub-indicator.
Climate-related matters may include the physical impacts of climate change and/or transition impacts from climate mitigation on the company’s market, sector, business environment, and drivers of its costs and revenues. It also includes the company’s own response, for example any emissions targets set and the company’s strategy for decarbonisation.
In addition to overall considerations, such as the company’s ability to continue as a going concern, examples of relevant assets and liabilities include (but are not limited to): property plant and equipment (PPE) assets; goodwill and other intangible assets; inventory; asset retirement or decommissioning obligations; deferred tax assets and liabilities; investments, including joint ventures and associates; and/or provisions and loss contingencies.
This Metric is assessed independently from Metric 1a on how the company has considered climate matters. This Metric can be achieved by disclosing relevant climate-related quantitative inputs even if the company did not take climate into consideration for such inputs.
Examples of relevant assumptions and estimates include (but are not limited to): projected interim and long-term commodity prices used in forecasting revenues, for example oil, gas and coal prices; CO2 prices used in forecasting costs; cash flow growth rates; and/or estimated remaining useful lives, particularly of climate-exposed assets and related obligations.
This metric is contingent on Metric 1a. To be assessed as ’Yes’, the company must have been assessed as ’Yes’ for Metric 1a.
Other reporting includes other sections of the annual report (or similar filing) and may also include separate reporting such as sustainability reports, TCFD reports, analyst presentations, and the company’s website.
This Metric focuses on financial statements. The company’s other reporting on climate provides the context for evaluating the financial statements, but is not separately assessed.
This Metric focuses on the auditor’s disclosure of Key or Critical Audit Matters (K/CAMs) as applicable under the relevant auditing standards. Discussions may either be in a separate climate-related K/CAM or on specific accounting topics. This Metric may also be achieved through reporting of how climate was considered in assessing risk and determining the audit approach.
This Metric assesses the auditor’s consistency check. An inconsistency between the discussion of climate matters outside the financial statements and consideration in the financials could result in a material misstatement in reporting.
Information that comprises ‘other information’ is specified under the relevant auditing standards. If Metric 1c is assessed as ‘Yes’ this Metric will likely result in a ‘Yes’.
This Metric focuses on the use of assumptions and estimates that are ‘best estimates’ of scenarios aligned with achieving net zero emissions by 2050 or sooner (‘aligned assumptions’), or the provision of a sensitivity analysis using such assumptions and estimates.
Currently, the International Energy Agency’s Net Zero Emissions by 2050 Scenario and related price deck are used for this assessment, where applicable. This sets out a pathway to reach net zero emissions by mid-century and keep the global temperature rise to 1.5°C with a 50% probability. However, additional updated reference scenarios may become available over time.
This Metric is independent of Metric 3a, as the auditor is asked to take an independent role in assessing the assumptions used by the company (either directly or through sensitivity analysis), or to indicate what reasonably-aligned assumptions would be and provide its own sensitivity analysis.
InfluenceMap provides detailed analyses of corporate climate policy engagement and the alignment of company climate policy engagement actions (direct and indirect via their industry associations) with the Paris Agreement goals. These scores reflect InfluenceMap’s assessment as of the 1st September 2022. Up-to-date scores, which are refreshed on a continual basis, can be found here. Download InfluenceMap’s climate policy engagement assessment methodology to learn more.
Organisation and Relationship Scores
- Green—The company’s Organisation and/or Relationship score is above 75%. This indicates broad alignment with the Paris Agreement.
- Amber—The company’s Organisation and/or Relationship score is between 50-74%. This indicates mixed engagement on climate policy.
- Red—The company’s Organisation and/or Relationship score is below 50%. This indicates increasingly significant misalignment with the Paris Agreement as the percentage nears zero. Scores below 25% indicate material and significant opposition.
- Grey (Not applicable)—The company’s Organisation Score is not applicable when its Engagement Intensity score is below 5%. The company’s Relationship Score is not applicable when it does not maintain significant links to industry associations actively influencing climate policy (as per InfluenceMap’s current database).
Engagement Intensity Score
- Above 25% indicates increasingly active and strategic policy engagement as the percentage nears 100%, with the highest Climate Action 100+ companies currently scoring around 60%.
- Above 12% indicates active policy engagement.
- Between 5-12% indicates a moderate level of climate policy engagement.
- Below 5% indicates low-level engagement with climate policy.
Organisation Score (expressed as a percentage from 0 to 100) is a measure of how supportive or obstructive the company’s direct engagement is with climate policy aligned with the Paris Agreement, with 0% being fully opposed and 100% being fully supportive.
The level of company support for (or opposition to) Paris-aligned climate policy.
Relationship Score (expressed as a percentage from 0 to 100) is a measure of how supportive or obstructive the company’s industry associations are towards climate policy aligned with the Paris Agreement, with 0% being fully opposed and 100% being fully supportive.
This calculation accommodates an assessment of the strength of the relationship between a company and an industry association, for example a stronger weighting will be attributed where a company has a representative on the board of an industry association.
The level of a company’s industry associations’ support for (or opposition to) Paris-aligned climate policy.
Engagement Intensity (expressed as a percentage score from 0 to 100) is a measure of the level of policy engagement by the company, whether positive or negative.
The level of a company’s direct climate policy engagement (positive or negative).
Notes
The disclosure framework evaluates the adequacy of corporate disclosure in relation to key actions companies can take to align their businesses with the Climate Action 100+ and Paris Agreement goals. The framework reflects publicly disclosed information as of December 31, 2021 and is assessed by the Transition Pathway Initiative. Download the disclosure framework methodology to learn more.
This Sub-indicator is based on TPI’s carbon performance methodologies.
When no explicit long term target that TPI can assess is available, the latest available data point of the company’s transition pathway is used to determine long term alignment. For example, a company with a 2030 but no targets thereafter will have its 2030 data point compared with the benchmark value in 2050.
This company is assessed against TPI’s 2°C Scenario (high efficiency), which is the best available for the auto sector. The intent is to assess all companies and sectors against a 1.5 degrees IPCC P1 scenario or equivalent, as and when the necessary data becomes available.
This Sub-indicator is based on TPI’s Carbon Performance methodologies which apply the Sectoral Decarbonisation Approach.
When no explicit medium term target that TPI can assess is available, the latest available data point of the company’s transition pathway is used to determine long term alignment. For example, a company with a 2030 but no targets thereafter will have its 2030 data point compared with the benchmark value in 2050.
This company is assessed against TPI’s 2°C Scenario (high efficiency), which is the best available for the auto sector. The intent is to assess all companies and sectors against a 1.5 degrees IPCC P1 scenario or equivalent, as and when the necessary data becomes available.
This Sub-indicator is based on TPI’s carbon performance methodologies which applies the Sectoral Decarbonisation Approach.
When no explicit short term target that TPI can assess is available, the latest available data point of the company’s transition pathway is used to determine long term alignment. For example, a company with a 2030 but no targets thereafter will have its 2030 data point compared with the benchmark value in 2050.
This company is assessed against TPI’s 2°C Scenario (high efficiency), which is the best available for the auto sector. The intent is to assess all companies and sectors against a 1.5 degrees IPCC P1 scenario or equivalent, as and when the necessary data becomes available.
Indicator 5 is sector neutral, assessing the key elements that should comprise any company decarbonisation strategy. Sector-specific expectations can be found in the Climate Action 100+ Global Sector Strategies. Implementation approaches will be adapted regionally.
Offsets are now explicitly referred to in the methodology for Sub-indicator 5.1, which asks that any decarbonisation strategy “clearly identifies the set of actions the company will implement to achieve its decarbonisation targets (such as phasing out carbon intensive products or assets, developing or deploying low carbon technologies, decarbonising supply chains or using offsets).”
Offsets will be an area for future development in the Net Zero Company Benchmark.
Examples of key elements include: changing technology or product mix, supply chain measures, R&D spending, etc.
Clarifications for meeting the requirements of Metric 5.1b have been added since the March 2021 iteration of the Net Zero Company Benchmark. In order to be assessed as “Yes” on this Metric in the March 2022 iteration, companies must quantify the approximate proportion of emissions reduction each action in their decarbonisation strategy will contribute to their overall greenhouse gas reduction target. Some year-on-year scoring changes are therefore anticipated. For more details, see the 2022 Disclosure Framework assessment methodology.
Currently Sub-indicator 5.2 and related Metrics only apply to focus companies headquartered on the European continent.
The assessment will leverage the European Union’s Green Taxonomy criteria on ‘turnover’ (or revenues) for companies headquartered on the European continent. The criteria used to assess non-European companies will be an ongoing area of development as part of broader discussions on the use of green revenue classification systems and regional taxonomies.
Clarifications have been added to Metric 6.1a to enable assessment of companies’ plans to phase out carbon intensive assets. Some year-on-year changes are therefore anticipated.
Clarifications have been added to Metric 6.1b to enable assessment of companies’ plans to phase out carbon intensive assets. Some year-on-year assessment changes are therefore anticipated.
Contingency: Metric 7.3b cannot be ‘Yes’ unless Metric 7.3a is also ‘Yes’.
The company discloses evidence of board or board committee oversight of the management of climate change risks via at least one of the following:
• There is a C-suite executive or member of the executive committee that is explicitly responsible for climate change (not just sustainability performance) and that executive reports to the board or a board level committee, and/or;
• The CEO is responsible for climate change AND he/she reports to the board on climate change issues, and/or;
• There is a committee (not necessarily a board-level committee) responsible for climate change (not just sustainability performance) and that committee reports to the board or a board-level committee.
The company has named a position at the board level with responsibility for climate change, via one of the following:
• A board position with explicit responsibility for climate change, or;
• CEO is identified as responsible for climate change, if he/she sits on the board.
Beta = data collected, but not publicly assessed. Subject to change in future iterations of the Benchmark.
Contingency: Metric 10.2b cannot be ‘Yes’ unless Metric 10.2a is also ‘Yes’.
Notes
Stellantis is the result of a merger between Peugeot and Fiat Chrysler, which concluded in January 2021. The combined entity published new information on its climate change strategy in March 2022. Plans include cutting carbon emissions by half by 2030 on the path to achieving carbon net zero in 2038. Setting the course for 100% BEV sales in Europe and 50% in the United States.
Alignment Assessments (formerly called Capital Allocation Assessment Indicators) complement the Disclosure Framework. They provide independent evaluations of the alignment and adequacy of company actions with the goals of Climate Action 100+ and the Paris Agreement.
These alignment assessments from the 2 Degrees Investing Initiative (2DII) are made using the PACTA methodology and data provided by Asset Resolution. They analyse automotive companies’ planned capital expenditures (CAPEX) and production output for the coming 5 years relative to a range of climate change scenario pathways for the sector. The assessments give investors insights on the relative adequacy and alignment of company actions with the Paris Agreement goals. These assessments reflect the company’s physical assets as of 31 December 2021. Download 2DII’s autos assessment methodology to learn more.
1. ASSESSMENT OF THE COMPANY’S 2021 TECHNOLOGY MIX VS. THE 2021 SECTOR AVERAGE
- Green—The company is ‘Ahead’ or ‘Slightly Ahead’ of the sector average.
- Amber—The company is ‘Aligned’ with the sector average.
- Red—The company is ‘Behind’ or ‘Slightly Behind’ the sector average.
2. ALIGNMENT OF THE COMPANY’S 2026 PRODUCTION FORECASTS FOR EACH TECHNOLOGY COMPARED TO INTERNATIONAL ENERGY AGENCY (IEA) SCENARIOS
- Green—The company’s trajectory is below the target for the B2DS<1.75°C or below the target for the NZE<1.5°C (where ‘B2DS’ is the IEA’s Beyond 2°C Scenario and ‘NZE’ is the IEA’s Net Zero by 2050 Scenario).
- Amber—The company’s trajectory is below the target for the 2DS 1.75°C-2°C (where ‘2DS’ is the IEA’s 2 Degrees Scenario).
- Red—The company’s trajectory is above the target for the 2DS >2°C or significantly above the target for the 2DS >2.7°C.
2d. ASSESSMENT OF THE COMPANY’S AGGREGATE IEA SCENARIO ALIGNMENT
- Green—The company is ‘Ahead’ or ‘Slightly Ahead’ of the B2DS target technology mix for the autos sector.
- Amber—The company is ‘Aligned’ with the B2DS target technology mix for the autos sector.
- Red—The company is ‘Behind” or ‘Slightly Behind’ the B2DS target technology mix for the autos sector.
This assessment shows how the company’s present mix of vehicle technologies compares with the sector average for each technology.
The analysis is conducted on the technology level, meaning 2DII compares the technology share of the company with the technology share of the global sector average. The assessment is based on whether the company’s technology mix is ahead of the market in terms of a decrease in ICE production or an increase in hybrid and EV production. For more information on how the sector average is calculated see the supporting methodology document.
Possible assessment outcomes include: Behind (>15% negative deviation); Slightly Behind (5-15% negative deviation); Aligned (+ or – 5%); Slightly Ahead (5-15 % positive deviation); or, Ahead (>15% positive deviation).
For example, if the market’s technology mix consists of 80% ICE’s, while the company’s technology mix consists of 60% ICE’s, then the company is ‘Ahead’ of the market (>15% positive deviation from the sector average), implying that it’s greener than the market. Similarly, if the market’s technology mix consists of 15% electric vehicles, and a company’s technology mix consists of 10% electric vehicles, then it’s ‘Behind’ the market (>15% negative deviation from the sector average).
This assessment shows the company’s planned contribution to the transition towards low carbon vehicles for the coming 5 years, in relative terms for various technologies.
The assessment evaluates the company’s automotive production plans with IEA scenarios and identifies the scenario pathway to which it most closely corresponds per technology.
The “aggregate scenario alignment of the company” is calculated for the IEA’s Beyond 2°C Scenario (B2DS) via a weighted average alignment across all technologies. The weighting uses a combination of: (i) the company’s target production per technology (i.e., the relative importance of the technology to the company); and (ii) the change in capacity per technology anticipated by the B2DS between 2021 and 2026 (i.e., the relative importance of the technology in the scenario).
Companies’ trajectories for each technology are assessed against target values for each scenario. The result is assessed as being either aligned with the Net Zero by 2050 Scenario (NZE<1.5°C), aligned with the B2DS (B2DS<1.75°C), aligned with the 2 Degrees Scenario (2DS 1.75°C-2°C), above the 2DS (2DS >2°C), or significantly above the 2DS (2DS>2.7°C). The IEA’s Reference Technology Scenario (RTS) is used to identify trajectories that are significantly above the 2DS.
See scoring rules above for more details.
Green—At the overall Indicator level, the company receives a ‘Yes’ on all Sub-indicators and Metrics that make up the indicator. At the Sub-indicator level, the company receives a ‘Yes’ on all Metrics that make up the Sub-indicator.
Amber— At the overall Indicator level, the company receives a ‘Yes’ on at least one Metric that makes up the Indicator. At the Sub-indicator level, the company receives a ‘Yes’ on at least one Metric that makes up the Sub-indicator.
Red—At the overall Indicator level, the company receives a ‘No’ on all Sub-indicators or Metrics that make up the indicator. At the Sub-indicator level, the company receives a “No” for all Metrics that make up the Sub-indicator.
Climate-related matters may include the physical impacts of climate change and/or transition impacts from climate mitigation on the company’s market, sector, business environment, and drivers of its costs and revenues. It also includes the company’s own response, for example any emissions targets set and the company’s strategy for decarbonisation.
In addition to overall considerations, such as the company’s ability to continue as a going concern, examples of relevant assets and liabilities include (but are not limited to): property plant and equipment (PPE) assets; goodwill and other intangible assets; inventory; asset retirement or decommissioning obligations; deferred tax assets and liabilities; investments, including joint ventures and associates; and/or provisions and loss contingencies.
This Metric is assessed independently from Metric 1a on how the company has considered climate matters. This Metric can be achieved by disclosing relevant climate-related quantitative inputs even if the company did not take climate into consideration for such inputs.
Examples of relevant assumptions and estimates include (but are not limited to): projected interim and long-term commodity prices used in forecasting revenues, for example oil, gas and coal prices; CO2 prices used in forecasting costs; cash flow growth rates; and/or estimated remaining useful lives, particularly of climate-exposed assets and related obligations.
This metric is contingent on Metric 1a. To be assessed as ’Yes’, the company must have been assessed as ’Yes’ for Metric 1a.
Other reporting includes other sections of the annual report (or similar filing) and may also include separate reporting such as sustainability reports, TCFD reports, analyst presentations, and the company’s website.
This Metric focuses on financial statements. The company’s other reporting on climate provides the context for evaluating the financial statements, but is not separately assessed.
This Metric focuses on the auditor’s disclosure of Key or Critical Audit Matters (K/CAMs) as applicable under the relevant auditing standards. Discussions may either be in a separate climate-related K/CAM or on specific accounting topics. This Metric may also be achieved through reporting of how climate was considered in assessing risk and determining the audit approach.
This Metric assesses the auditor’s consistency check. An inconsistency between the discussion of climate matters outside the financial statements and consideration in the financials could result in a material misstatement in reporting.
Information that comprises ‘other information’ is specified under the relevant auditing standards. If Metric 1c is assessed as ‘Yes’ this Metric will likely result in a ‘Yes’.
This Metric focuses on the use of assumptions and estimates that are ‘best estimates’ of scenarios aligned with achieving net zero emissions by 2050 or sooner (‘aligned assumptions’), or the provision of a sensitivity analysis using such assumptions and estimates.
Currently, the International Energy Agency’s Net Zero Emissions by 2050 Scenario and related price deck are used for this assessment, where applicable. This sets out a pathway to reach net zero emissions by mid-century and keep the global temperature rise to 1.5°C with a 50% probability. However, additional updated reference scenarios may become available over time.
This Metric is independent of Metric 3a, as the auditor is asked to take an independent role in assessing the assumptions used by the company (either directly or through sensitivity analysis), or to indicate what reasonably-aligned assumptions would be and provide its own sensitivity analysis.
InfluenceMap provides detailed analyses of corporate climate policy engagement and the alignment of company climate policy engagement actions (direct and indirect via their industry associations) with the Paris Agreement goals. These scores reflect InfluenceMap’s assessment as of 24 January 2022.Up-to-date scores, which are refreshed on a continual basis, can be found here. Download InfluenceMap’s climate policy engagement assessment methodology to learn more.
Organisation and Relationship Scores
- Green—The company’s Organisation and/or Relationship score is above 75%. This indicates broad alignment with the Paris Agreement.
- Amber—The company’s Organisation and/or Relationship score is between 50-74%. This indicates mixed engagement on climate policy.
- Red—The company’s Organisation and/or Relationship score is below 50%. This indicates increasingly significant misalignment with the Paris Agreement as the percentage nears zero. Scores below 25% indicate material and significant opposition.
- Grey (Not applicable)—The company’s Organisation Score is not applicable when its Engagement Intensity score is below 5%. The company’s Relationship Score is not applicable when it does not maintain significant links to industry associations actively influencing climate policy (as per InfluenceMap’s current database).
Engagement Intensity Score
- Above 25% indicates increasingly active and strategic policy engagement as the percentage nears 100%, with the highest Climate Action 100+ companies currently scoring around 60%.
- Above 12% indicates active policy engagement.
- Between 5-12% indicates a moderate level of climate policy engagement.
- Below 5% indicates low-level engagement with climate policy.
Organisation Score (expressed as a percentage from 0 to 100) is a measure of how supportive or obstructive the company’s direct engagement is with climate policy aligned with the Paris Agreement, with 0% being fully opposed and 100% being fully supportive.
See scoring rules above for more details.
The level of company support for (or opposition to) Paris-aligned climate policy.
Relationship Score (expressed as a percentage from 0 to 100) is a measure of how supportive or obstructive the company’s industry associations are towards climate policy aligned with the Paris Agreement, with 0% being fully opposed and 100% being fully supportive.
This calculation accommodates an assessment of the strength of the relationship between a company and an industry association, for example a stronger weighting will be attributed where a company has a representative on the board of an industry association.
See scoring rules above for more details.
The level of a company’s industry associations’ support for (or opposition to) Paris-aligned climate policy.
Engagement Intensity (expressed as a percentage score from 0 to 100) is a measure of the level of policy engagement by the company, whether positive or negative.
See scoring rules above for more details.
The level of a company’s direct climate policy engagement (positive or negative).
Notes
The company discloses evidence of board or board committee oversight of the management of climate change risks via at least one of the following:
• There is a C-suite executive or member of the executive committee that is explicitly responsible for climate change (not just sustainability performance) and that executive reports to the board or a board level committee, and/or;
• The CEO is responsible for climate change AND he/she reports to the board on climate change issues, and/or;
• There is a committee (not necessarily a board-level committee) responsible for climate change (not just sustainability performance) and that committee reports to the board or a board-level committee.
The company has named a position at the board level with responsibility for climate change, via one of the following:
• A board position with explicit responsibility for climate change, or;
• CEO is identified as responsible for climate change, if he/she sits on the board.