Net zero — progress, achievements and limitations

  • Economies will be under scrutiny and compelled to implement concrete and effective climate-related actions in line with their provisional deadlines; hence, policy developments and economy-wide interventions need to be practical and workable
  • Around 83% of global GHG emissions are covered by country-level net-zero pledges; if these are fulfilled, it would reduce global emissions significantly
  • Companies in carbon-intensive sectors such as oil and gas and metals and mining need to proactively include and follow the Science Based Targets initiative’s (SBT’s) sectoral decarbonisation approach (SDA) to achieve net zero; otherwise, they are likely to face large financial and reputational losses, with their assets stranded due to regulatory mandates
  • Annual or more frequent GHG reporting encourages businesses to manage risks and identify new opportunities. Regular GHG reporting also increases transparency and accountability and boosts investor sentiment
  • Carbon credits incentivise organisations to reduce emissions and avoid heavy carbon taxes. These credits can be used to offset internal emissions and avoid emission-related penalties; they are also a high-return, long-term investment instrument

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Acuity Knowledge Partners

Acuity Knowledge Partners

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We write about financial industry trends, the impact of regulatory changes and opinions on industry inflection points. https://www.acuitykp.com/