Top carbon emitters fail to disclose climate risks, report says
LONDON (Reuters) – Major carbon emitters do not disclose all the risks associated with climate change, reducing the chances of meeting global emissions targets, a study by Carbon Tracker and the Climate Accounting Project said on Thursday ( CAP).
The CAP is an informal team of accountants and financial experts from the investment community and mandated by the Principles for Responsible Investment (PRI), while Carbon Tracker is funded by around 30 charitable foundations.
Out of 107 listed companies assessed in the study, in sectors such as oil and gas, automotive and aviation, more than 70% did not reflect all the risks resulting from climate change in their 2020 accounts, according to the report released Thursday by Carbon Tracker.
“Based on the significant exposure of these companies to transition risk, and with many announcements of emissions targets, we expected climate issues to be taken into account much more heavily in finance than we did. found, ”Barbara Davidson, senior analyst at Carbon Tracker and lead author of the report, mentioned.
“Without this information, there is little way of knowing the extent of risk capital, or whether funds are being allocated to unsustainable companies, which further reduces our chances of decarbonising in the short period of time that remains for us. meet the Paris targets, ”Davidson added.
Eight out of ten audits also showed no evidence of climate risk assessment, for example testing assumptions and estimates made on long-term asset impairments, before accounts are closed, the report added.
The lack of consistency between climate commitments made and their treatment in financial accounts was also a concern, according to the study, adding that none used assumptions consistent with the Paris Agreement, which aims to limit global warming. climatic to 1.5 degrees Celsius maximum.
The report follows campaigns by leading investors for better disclosure and better risk analysis for energy companies and other large emitters such as miners.
Global accounting and auditing standard-setters have since said climate risks should not be ignored in the accounts.
The report was released ahead of the next round of global climate talks in Glasgow in November, where countries are expected to step up efforts to limit global warming.
Reporting by Simon Jessop; Editing by Alexander Smith