Scope 3, Schroders, Pre-COP27, and Future Risks

1. ISSB Unanimously Confirms Scope 3 GHG Emissions Disclosure Requirements-

The ISSB confirmed that its requirements will focus on meeting the information needs of investors.
The International Sustainability Standards Board (ISSB) of the IFRS Foundation has made significant progress refining its first two proposed sustainability-related disclosure standards―[draft] IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and [draft] IFRS S2 Climate-related Disclosures.
At its October meeting, following careful analysis of the feedback on its proposed standards, the ISSB voted unanimously to require company disclosures on Scope 1, Scope 2 and Scope 3 greenhouse gas (GHG) emissions, applying the current version of the GHG Protocol Corporate Standard. As part of these requirements, the ISSB will develop relief provisions to help companies apply the Scope 3 requirements.
Link to Source: https://www.insightsesg.com/post/issb-unanimously-confirms-scope-3-ghg-emissions-disclosure-requirements

2. SBTi Case study - Schroders-

The global asset management firm committed to set science-based targets in 2021 and was one of the first financial institutions to have its targets validated by the SBTi.
Our impact analysis of climate change models that long-run returns may be materially different when the impact of climate change is taken into account. We believe that every economy, industry and company will need to plot a net-zero path to remain competitive. As such, we aspire to become one of the world’s leading investment companies with sustainability at our core. We are proud to have become the largest asset manager by AUM to have its targets validated by the SBTi.
The SBTi’s Financial Institutions framework has become a familiar document to many of us within Schroders. It provides great detail and precision to determine both the assets in scope for an organization like ours, as well as methodology details that are critical to ensuring comparability across users.
Link to Source: https://www.insightsesg.com/post/sbti-case-study-schroders

3. Climate Action 100+ Net Zero Company Benchmark-

Interim cycle of Benchmark assessments provides investors with timely data to inform engagement strategies ahead of upcoming proxy seasons.
While focus companies continue to make progress on net zero commitments, this is not matched by the development and implementation of credible decarbonisation strategies. While mindful of current external factors, including the short-term energy security crisis, investors consider the development of corporate decarbonisation strategies a key priority.
The Benchmark’s Alignment Assessments complement the Disclosure Framework by measuring implementation of Paris-aligned corporate actions. Whilst focus companies are incrementally improving their disclosures under the Disclosure Framework, the latest Alignment Assessments suggest their real-world activities do not yet demonstrate any meaningful shifts in business models at some companies to align with the Paris Agreement.
Link to Source: https://www.insightsesg.com/post/climate-action-100-net-zero-company-benchmark

4. UNEP Emissions Gap Report 2022-

The report is the 13th edition in an annual series that provides an overview of the difference between where greenhouse emissions are predicted to be in 2030 and where they should be to avert the worst impacts of climate change.
The report shows that updated national pledges since COP26 – held in 2021 in Glasgow, UK – make a negligible difference to predicted 2030 emissions and that we are far from the Paris Agreement goal of limiting global warming to well below 2°C, preferably 1.5°C. Policies currently in place point to a 2.8°C temperature rise by the end of the century.
Implementation of the current pledges will only reduce this to a 2.4-2.6°C temperature rise by the end of the century, for conditional and unconditional pledges respectively.
Link to Source: https://www.insightsesg.com/post/unep-emissions-gap-report-2022

5. AXA Future Risks Report 2022-

For the first time in nine years of surveying, global experts in every region of the world ranked climate change as the top future risk facing society.
The surveys underlying the analysis, which incorporate expert opinion as well as public polling, show that both risk experts and the public place climate change higher on the list of global concerns than just a year or two ago.
Over the last year, economic and geopolitical challenges have added a new layer of uncertainty to the disruptions caused by the Covid pandemic and the climate crisis. Meanwhile, almost 70% of the general public believe that insurers will have an important role to play in mitigating future risks.
Link to Source: https://www.insightsesg.com/post/axa-future-risks-report-2022

One more thing: A great diagram form Singapore’s The Straits Times summarizing the expected key issues at this year’s COP27 climate summit.

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