The private sector is driving global decarbonisation efforts
ReactionNov 30, 2020
Environmental disclosure platform CDP has reported that fewer than one in 200 companies that submitted data related to climate change have credible climate transition plans.
Out of nearly 19K firms that reported information to CDP, just 81 companies — with a combined value of more than $1.7T — were able to demonstrate they had adopted credible climate practices. The CDP assessed the businesses based on a criteria of 21 climate transition indicators.
The investment of private finance in sustainability should not be understated — the private sector is increasingly taking on the responsibility of carbon neutralization where the state is failing to act. As of 2020, almost 1.5K companies with revenues in excess of $20.5T had made quantifiable commitments to reduce polluting emissions. Fossil fuels were once key to economic and industrial development for many nations but, now that the environmental cost of fossil fuel drilling and export outweighs the financial interest, green investment has become the mainstream in global business.
Private investment in sustainable business processes has rapidly increased in recent years, but it is still nowhere near the scale required to protect the future of the planet. The coming green rush does not mean companies are turning their backs on profitable fossil fuels — government intervention must go further to compel companies to significantly reduce emissions and speed up the implementation of sustainable business models.
There is a 33% chance that the EU will achieve its Paris Climate Agreement goals, according to the Metaculus prediction community.