40% of 2020 emissions targets ‘failed or disappeared’

US researchers assessing the level of corporate accountability for climate targets found that 40% of goals with a 2020 deadline either failed or disappeared from companies’ communications – with almost no consequences.

Of the 1,041 firms that published emissions reduction targets ending 2020, 88 (9%) failed to achieve them, and 320 (31%) stopped talking about these goals without sharing their outcome. 

The report sheds light on the actual outcomes of climate target-setting at a time when many companies are expected to miss their 2025 goals and adjust 2030 expectations – Walmart is a prime example. 

But it also highlights a certain lack of scrutiny and accountability for missing these goals: unlike financial targets which, when they are not met, result in negative market reactions, CEO bonus reductions and negative press, only three of the 88 firms that missed their 2020 emissions goals had any type of media coverage, with no “significant market reaction, changes in media sentiment, environmental scores and environment-related shareholder proposals,” the researchers note.

This contrasts with the positive sentiment triggered by announcing the targets in the first place, and suggests that more needs to be done to keep companies accountable for their climate goals.

Join our February 12 webinar to hear SBTi’s Kim Schoppink discuss rules and best practices for setting and reviewing climate targets – and how to maintain trust and ambition, even after missing one.

Climate targets: Outcomes and transparency

Using CDP data, the researchers identified 1,041 firms with 2020 targets: together, these represented 2.5 billion tonnes of Scope 1 GHG emissions in 2020 – 5% of annual global emissions.

Of the 88 that failed to reach their targets, 78 published sustainability reports in 2021 – but only 26 (33%) acknowledged missing them, and just 16 used explicit language like ‘failed’ and ‘missed’ in the report.

“Overall, the evidence suggests low transparency in voluntary disclosure of target outcomes by firms,” warn the New York University, UC Berkeley and Harvard researchers.

Even those that met their targets didn’t communicate it openly: only 12 firms issued press releases to announce success in reducing emissions (out of 633).

Two potential drivers for ‘disappearing’ targets

When analysing the companies that simply stopped mentioning their 2020 targets without disclosing their outcome, the report finds “a mix of two types of companies”: those that silently removed 2020 emissions targets, “potentially after realising a higher likelihood of failure”, and those updating 2020 targets with more ambitious goals for future years.

Researchers also found that around 63% of firms that stopped talking about their 2020 absolute reduction targets would not have met them. 

Companies in the energy, utilities and industrial sectors were found to have the highest likelihood of disappeared targets.

What to expect in the coming years

While revealing, the research may not be indicative of what’s to come for 2030, 2040 and 2050 targets. Since 2020, many more companies have aligned their target-setting with the Science-Based Targets initiative, which supports the robustness and achievability of climate goals.

Most SBTi targets will meet their first deadlines in 2025, with companies expected to publicly report on their progress. In addition, SBTi says it is “conducting research to identify current best practices and critical topics to measure progress and to assess progress against targets in a robust and standardised way,” suggesting that it may soon play a role in keeping firms accountable.