We believe the integration of forward-looking data, such as the adoption of science-based targets, into climate-related methodologies can help investors explicitly understand the efforts of companies in the transition towards a low-carbon economy.
The Science Based Targets Initiative (SBTi) plays a crucial role here. The initiative provides the methodologies necessary for companies to set and disclose science-based net-zero targets, aiming to limit global temperature rise to 1.5 掳C above pre-industrial levels.
We analyzed the potential differences in sustainability and return profile for companies that have adopted science-based targets or commitments and those that have not.
Our analysis suggests investing in companies with science based targets may:
Our analysis suggests investing in companies with science based targets may:
- Improve the profile of a strategy in terms of overall ESG characteristics and mitigation of carbon emissions-related risk
- Improve the accuracy in measuring companies' efforts towards the transition to a low-carbon economy
- Reduce the uncertainty of climate forward-looking modelling at the company level
