As regulatory and consumer pressure grows for companies to increase their sustainability efforts, many are taking steps to cut their greenhouse gas emissions. However, according to S&P data, only 45% of U.S. organizations have made any net-zero commitments. The utilities, communications and consumer discretionary sectors have the highest percentage of companies with net-zero commitments, while consumer staples, real estate and materials have the lowest.
To spur climate action, 15% of S&P 500 companies now link CEO compensation incentives to emissions reduction goals (up from 9% in 2021), while 27% have established incentives for other executives (up from 19%).
“As investors obtain more climate-related information and more transparency into corporate emissions, companies could face more market pressure to build transition plans that include decarbonization or a net-zero goal,” the report said. “Net-zero target-setting could evolve to become the norm.”