More than 80% of the most polluting publicly traded companies fail to deliver greenhouse gas emissions reductions that are in line with the global warming limit below 2 degrees Celsius regulated by the 2015 Paris Climate Agreement.

Many also fail to address climate risk mitigation strategies.

The annual report of the Transition Pathway Initiative (TPI) estimates 238 energy, industrial and transportation companies by projected emission intensities, finding that only 18% (43 companies) are on track to deliver compliant emissions reductions with climate regulations.

Although this is only a 2% improvement over last year, the oil and gas industry is lagging behind other sectors.

The report finds that electricity companies and papermakers that set their 2025 targets to reduce their emissions rates by an average of about 4% each year, a trajectory that can exceed the goals set by businesses in these sectors.

However, by 2025, steel and cement companies are actually increasing their emissions intensities until the oil and gas sector shrinks emissions fast enough to reach their targets.

“The International Energy Agency (IEA) has warned that while carbon emissions are likely to decline this year, the spread of coronavirus in the medium term may delay the transition to zero emissions, with green investments being blocked by governments and businesses”, said the co-chair of TPI, Faith Ward.

While companies like Daimler have set new targets for harmful emissions in the last year, the report finds that highly polluting companies in sectors such as aluminum, steel, and shipping are failing to disclose or simply have no emission reduction data.

The report also found that 31% of companies disclosed their carbon price and 26% provided an analysis of their climate scenarios, as recommended by the Special Financial Climate Disclosure Group (TCFD). The Authority’s recommendations are currently publicly supported by more than 1000 organizations worldwide.

Companies are performing less well in terms of managing climate risks. Seven companies, including E.ON, Unilever, BHP Billiton, and Equinor, all meet the criteria, with 38% of the companies identified as “not ready for transition”.

Climate sustainability is increasingly attracting business attention as the impacts of climate change become more apparent and profound. A group of 215 of the world’s largest companies risks collectively losing up to 1 trillion USD due to climate change, and most of that risk will have an effect within the next five years.

The increasing impact of climate change and the rapid expansion of the alternative protein industry will put billions of dollars at risk in sectors such as meat processing, with the world’s largest oil and gas companies also risking economic losses by continuing to disclose data related to climate.