CDP’s campaign to support Science Based Targets (SBT) was launched in 2020 with the aim of engaging as many investors as possible to guide companies in defining ambitious, science-aligned strategies and actions in terms of climate change mitigation. This commitment translates into policies aimed at reducing greenhouse gas emissions, in line with that indicated in Paris in 2015.
The Paris Agreement calls for limiting, by the end of the century, the increase of the average global temperature on land and oceans to well below 2 degrees Celsius compared to pre-industrial levels, remaining, according to the text, as close to 1.5 degrees as possible.
Also in 2021 Etica is among the 220 institutional investors who have signed up to the project. In total, the participants hold $29.3 billion in assets and are calling for targets consistent with scientific evidence on limiting climate warming.
Science Based Targets, the number of companies committed to reducing climate change is growing
By 2020, 137 financial institutions from around the world had joined the project: in 2021, there was a 60% growth. This is a sign that awareness of the need for immediate action on climate change is also growing in the world of finance. So is the willingness to demonstrate this issue to business leaders, with the aim of convincing them of the need to act on the basis of shared scientific data.
“After the 2020 campaign, explains CDP, there are 154 companies that have signed-up to the project. Their emissions are equal to those of a nation like Germany and businesses that have adopted SBTs have lowered their greenhouse gas emissions by 6.4%”.
The results are therefore clear: moral persuasion of companies pays off. CDP sent its appeal to 1,600 companies around the world this year, asking that each set credible, ambitious and science-aligned emissions reduction targets.
“Etica started asking companies to set emission reduction targets, certified as science-based, in 2018, so it is natural to participate in CDP’s Science Based Targets campaign”, commented Aldo Bonati, Etica Corporate Engagement and Networks Manager. “The campaign clarifies and reinforces investors’ expectations of how companies can play their part in achieving the climate goal set by the Paris Agreement. Companies that join are demonstrating their commitment to integrating climate risk into their management system. It is the job of investors to not only ask for targets to be set, but to also monitor the pathway towards achieving them. Companies that succeed in meeting or exceeding their targets are better equipped to deal with the risks and opportunities of the transition to a low greenhouse gas economy”.