An analysis of the UK’s top 100 companies has found that almost a third are emitting carbon at a rate that would push the world’s temperature to dangerous levels by 2050 if continued.
A high rate of carbon emissions undermines the Paris Climate Agreement, an internationally agreed commitment to climate action drawn up in 2015 that set an overall ambition for the world to be no warmer than 1.5 degrees Celsius above pre-industrial levels.
However, 31 companies in the FTSE 100 (the largest companies listed on the London Stock Exchange) are emitting carbon dioxide at a rate consistent with global temperature increases of 2.7 degrees warmer or higher by 2050, an analysis by Arabesque, a company that provides sustainability data to investors, has found.
Climate scientists predict that global warming above the 1.5 degrees level will mean much more frequent incidents of extreme weather. For example, an analysis by climate scientists at NASA from 2019 warns that at 2 degrees, there’s a much higher likelihood of heavy rain, cyclones, and flooding, compared with 1.5 degrees of warming.
Arabesque assigned scores to the companies by calculating their greenhouse gas emissions per dollar of revenue — using their latest disclosed emissions data, the Guardian reported. Only 83 of the companies in the FTSE had up-to-date emissions information, so the remainder were not given a score, but they were mainly services companies which typically have lower emissions, the organisation said.
The analysis only took into account what is known as scope 1 and scope 2 emissions as well, meaning emissions that are directly in a company’s operational control — for example, the energy they use to run their buildings and produce their products.
In the case of oil companies, the analysis does not therefore take into account the oil that they extract and sell, as that counts as a scope 3 carbon emission, meaning it arises indirectly from the purchase of goods or services.
Oil companies including BP, Shell, and mining companies such as Anglo American, Evraz, and Rio Tinto all featured in the list of 31 companies that Arabesque identified as having high carbon emissions per dollar of revenue, even when just considering their scope 1 and scope 2 emissions.
Other companies that scored poorly include the supermarket chain Morrisons, the National Grid electricity company, and the insurance company, Admiral Group.
Some companies are emitting carbon at a rate consistent with the world reaching 2.7 degrees above pre-industrial levels, but have agreed science-based targets, set to United Nations’ benchmarks, to decarbonise their operations. Those companies include British Land (a property company), Smurfit Kappa (packaging), and International Airlines (air travel).
It is crucial the world doesn’t come close to 2.7 degrees warmer. Both the UN’s Intergovernmental Panel on Climate Change (IPCC) and the Paris Climate Agreement indicate that 2 degrees warmer is the upper limit of what the world should aim for, with no more than 1.5 degrees warmer being preferable.
Beyond 2 degrees the effects of climate change are predicted to be even more extreme and therefore it will be harder and more expensive for the world to adapt.
The website Carbonbrief.org has aggregated over 70 scientific studies predicting the likely outcomes at different levels of warming. At 2 degrees warmer, for example, 37% of the world population will experience an extreme heatwave at least once every five years, compared to 14% of the population for the same event at 1.5 degrees warmer.
At 3 degrees warmer the average drought will last 10 months as opposed to just 2 months at 1.5 degrees, their graph shows, with huge implications for food security.
Arabesque’s findings were not all bad news — 27 companies were shown to have already reduced their emissions output to a rate that is compatible with keeping temperature increases to 2C or lower, their report said.
Georg Kell, the chair of Arabesque, previously founded the UN Global Compact — the world’s largest corporate sustainability initiative, which over 7,000 companies worldwide have voluntarily signed up with to agree to cut their carbon emissions.
Kell told the Guardian that COP26, the UN’s climate conference taking place in Glasgow this November, will hopefully be a good opportunity for new policies to force companies to decarbonise faster.
He said that the “momentum has turned decisively in favour of decarbonisation in recent years.” However, he added that some companies were still not being entirely upfront about their carbon footprint data: “Too many companies are playing the benchmarks to look good,” he said.
Kell added: “I’m very optimistic [about COP26] now because we have an historical alignment — the politics is aligned.”