October 2022 – September 2023

Limiting global warming to 1.5°C requires immediate action as climate change poses an urgent and unprecedented threat to people, communities, business and the entire global economy. Financial institutions (FIs) and companies have a pivotal role to play in tackling this challenge. Addressing the climate crisis requires engagement with high-impact industries to halve global greenhouse gas (GHG) emissions by 2030 and making more substantial reductions of 90-95% by 2050.

CDP’s Science-Based Targets (SBT) Campaign, launched in October 2020, aims to incentivize high-impact companies, listed on global stock markets, to set science-based targets (SBTs).

The campaign creates a positive ambition loop between CDP Capital Markets signatories (including investors), CDP Supply Chain members (ie multinational firms), and companies. It offers CDP signatories and supply chain members the opportunity to collaborate with companies, encouraging them to take steps to reduce emissions in the private sector and transition to a low-carbon economy.

Now in its third cycle, the campaign continues to amass support from global FIs that use their market position to demand and influence companies to set emissions reduction targets in accordance with the latest science. Global FIs, including investors and banks, support broad global decarbonization of high-impact sectors such as energy, infrastructure, and materials.

The SBT campaign also provides a unique opportunity for CDP Supply Chain members to use their buying power to increase the number of suppliers that are 1.5°C-aligned, making it easier to meet their own Scope 3 targets.

This campaign leverages CDP’s robust collective engagement approach, drawing on the organization’s experience as a founding partner of the Science-Based Targets initiative (SBTi). CDP’s global corporate engagement team plays a vital role in driving the campaign’s success and impact, working year-round to actively engage, inform, educate, and support targeted companies to commit to setting science-based targets through the SBTi.

In the first edition of the SBT Campaign in 2020, CDP targeted 1,830 climate high-impact companies.

Over subsequent cycles, campaign supporters have continued to engage with this list of high-impact companies who have yet to join the SBTi. The number of companies targeted gradually reduces as more companies join the SBTi* through each campaign cycle.**

The Science Based Targets initiative (SBTi) is a global body enabling businesses to set ambitious emissions reductions targets in line with the latest climate science. The SBTi’s goal is to accelerate companies across the world to support the global economy to halve emissions before 2030 and achieve net-zero before 2050.

*Throughout this report, "joining the SBTi" refers to companies joining via commitment and/or getting targets validated. Please refer to the SBTi’s commitment compliance policy for more information.

**Some companies may also be removed from the list of targeted high-impact companies due to change in market status, SBTi policy change, or other reasons.

1,060 high-impact companies were targeted in CDP's 2022-2023 SBT Campaign. 99 new companies with a combined market cap of $3.57 trillion have joined the SBTi as a result.

318 financial institutions (FIs) and multinational firms with $37 trillion in assets and spending power supported the campaign, - an increase of almost 30% from the previous year.

This demonstrates an increasing understanding among FIs and CDP supply chain members of the need to engage companies and incentivize their investees and suppliers to set targets.

74% of FI campaign supporters are headquartered in Europe and the UK, showing continuous high engagement from FIs in these markets.

89% of CDP Supply Chain members participating in the campaign were based in the UK, Europe, US, and Canada.

Japan had the highest number of companies joining the SBTi in this cycle of the campaign, representing 28% of the total emissions of the high-impact companies joining (this is consistent with the findings of the SBTi Monitoring Report 2022).

European companies continue to lead on target setting relative to the targeted emissions in the region. The largest markets - China and the US - are still lagging behind.

Materials and power generation are the two highest emitting sectors in the campaign's target sample, representing 73% of targeted emissions. However, action and target setting from both sectors remain below average.

The manufacturing sector demonstrated increased engagement, representing 12% of the total emissions of companies that joined the SBT through the campaign, compared with 7% in the previous campaign.

273 FIs with $36 trillion in assets and 45 supply chain supporters with $700 billion in purchasing power supported the 2022-2023 campaign.

The campaign was officially supported by the Net-Zero Asset Owner Alliance, the UK Sustainable Investment and Finance Association, the French SIF (FIR), China SIF and SHARE Canada.

1,060 companies targeted

~$25 trillion total market cap

7 Gt total GHG emissions

23% MSCI ACWI coverage

99 companies joined the SBTi during the 2022-23 campaign. This represents 9% of targeted companies.

4% of the total emissions (Scope 1 and 2) targeted in the campaign was incorporated into the SBTi through commitments to set targets or having targets approved – this represents 0.22 Gt CO2e from the total 6.08 GtCO2e targeted in the campaign.

15% of the total market value of the targeted companies was incorporated by companies joining the SBTi, representing $3.57 trillion out of $24.51 trillion.

The 2022–23 campaign targeted 1,060 of the world’s highest impact companies.

The targeted companies' combined Scope 1 and 2 GHG emissions (the targeted emissions) total around 7 Gt (gigatons) of CO2e*, equivalent to the emissions of the US, UK and France combined. [Source]

Of the target sample, 99 new companies joined the SBTi.

• 58 of those have near-term commitments.
• 8 have net-zero commitments.
• 33 have both near-term and net-zero commitments.

Companies targeted in the campaign are drawn from the CDP climate high impact sample (CHIS), a CDP-curated sample of companies that are significant from a market capitalization and GHG emissions perspective. The CHIS is adjusted regularly to define the relevant subset for outreach.

The group of targeted companies were heavily weighted toward Asia, the US and Canada.

• 57% of all companies targeted were based in the Asia Pacific region.
• 26% are based in the US and Canada.

Only about 1 in 10 targeted companies are headquartered in Europe - reflecting that target-setting is already established as a strong practice in the region.

Some notable companies targeted include:

China's largest retailer JD.com

Australian flag carrier Qantas

the world's biggest chemicals firm BASF

Caterpillar

FEDFEX

General Electric

...and many more.

The 2022–23 campaign reflects a lower number of targeted high impact companies joining the SBT campaign compared to previous campaigns. However, engagement from FIs and multinational companies continues to rise, reflecting growing awareness of the critical role they must play in influencing and supporting global companies at all levels of their journey to net-zero, including setting science-based emissions reduction targets.

To date, CDP’s SBT campaign has helped drive 470 companies - more than 25% of the 1,830 high-impact companies originally targeted in 2020 - to join the SBTi.

Looking forward to the campaign's fourth cycle in 2023-2024, CDP will target 2,100 high impact companies. The campaign will continue to leverage the influence and engagement of FIs and CDP supply chain members to help scale corporate action toward 1.5°C-alignment and greater emissions reduction.

The SBTi is expecting strong growth in target setting in the coming years. The initiative is evolving to better tackle growing demand for science-based targets with increased awareness of the impacts of climate change, particularly after a record-breaking hot summer in the Northern Hemisphere.**

*CO2 equivalent, the universal unit of measurement to indicate the global warming potential (GWP) of each of the six greenhouse gases, expressed in terms of the GWP of one unit of carbon dioxide. As outlined in The Greenhouse Gas Protocol.

**Science-Based Targets Initiative. (13th Sep 2023). Corporate climate action gets a boost with upgrade to target validation and standard setting.

Materials, power generation, and manufacturing account for 71% of the emissions covered by companies joining the SBTi during this campaign.*

The majority of companies targeted in the campaign belong to the materials (cement, concrete, chemicals, metals and mining, wood and paper activities) and power generation sectors.

Companies in these sectors represented 73% of the targeted emissions.

The manufacturing sector was also comparatively more active, as companies from this sector only represented 3% of the targeted emissions but comprised 12% of companies joining the SBTi.**

*Percentages are weighted by Scope 1 and Scope 2 emissions, in tonnes of CO2e.

**This analysis uses the “Industry” category of the CDP ACS sector classification for its sector classification.

70% of targeted companies were headquartered in Asia.

Asian companies represent 57% of the total 215 MtCO2e in emissions that will be covered by SBTs following new commitments.

Japan saw the most emissions by country committed to reduction (63 MtCO2e), as well as the highest percentage of target companies committing to set targets (11%).

On an emissions basis, 8% of targeted companies were European, but their emissions represent nearly a quarter (48 MtCO2e) of the total emissions joining the SBTi.

Encouragingly, the results showed high active rates from Latin American and African companies compared with previous campaigns. It is promising to see increased action taking place in emerging markets. However, it is important to note that most of the companies joining the SBTi in these regions are included in the scope of their parent companies headquartered in other regions.* For example, Walmart de Mexico is included in the near-term targets of Walmart Inc. and ENGIE Brasil Energia S.A. is covered by ENGIE’s targets.

In order to make significant strives toward achieving net-zero and reducing global emissions, greater action is required from companies in these regions. Capacity building and stronger ambition are critical factors in helping to scale credible corporate action in Latin America, Africa and other emerging markets, enabled by stronger policies and regulations.

*Regions, here, were defined to represent as best as possible the weight of each continent in the graphs and may in some cases refer to sub-regions of a continent, or to individual countries. Asia was namely sub-divided into individual countries for the countries with highest weights.

The top 10 geographic locations where committed emissions were highest are diverse.

In the majority of countries and regions, committed emissions cover a relatively small proportion of the total emissions that were targeted in the campaign. For example, the committed emissions from US companies represent only 2% of the total emissions that were targeted in the campaign. The countries with the most emissions targeted were China (2.3 Gt CO2e), the US (1.0 Gt CO2e), and Japan (0.6 Gt CO2e). Strong action is still required from some of the world’s largest markets.

The countries with the biggest proportion of targeted emissions committed to the SBTi were Sweden (99%), Italy (97%), and Spain (57%).

However, a relatively small group of companies were targeted in these countries, with six companies targeted in Sweden and Italy, and eight companies targeted in Spain.

CDP is kicking off the 2023-2024 campaign with 367 supporters - 307 global FIs and 60 multinational corporates - with approximately $33 trillion in assets under management and procurement power.

The global FIs backing this year’s campaign include:

Legal & General Investment Management

Nomura Asset Management Co, Ltd

Crédit Agricole SA

New York State Common Retirement Fund

British Columbia Investment Management Corporation (BCI)

Cathay Financial Holdings

Multinational corporates leading the campaign call include:

Bayer

BMW AG

L'Oréal

In the new edition of the campaign, the number of targeted corporations has nearly doubled to approximately 2,100 companies*, as a result of the expansion of the CDP CHIS.**

A full list of all 367 supporters is available here.

*The target list of companies also excludes companies that have since joined the SBTi and some have been unlisted and merged. Two other exclusion criteria that have been applied since 2022 are: companies that cannot join and set a science-based target due to the current SBTi Fossil Fuel Policyand companies headquartered in Russia and Belarus.

**For more information on the 2023-24 CDP Science Based Targets Campaign Sample Context and Methodology.

2,100 companies will be targeted

$28 trillion total market cap

84GT total GHG emissions

32% MSCI ACWI coverage 

CDP is dedicated to enhancing the impact of the campaign by continuing to:

• Increase localization of the campaign: CDP is sending translated versions of SBT Campaign requests to target companies. Letters will be sent in Simplified Chinese, Traditional Chinese, English, Japanese, Korean, Portuguese, Spanish, and Turkish – part of our efforts to address the high percentage of target companies in the emerging markets.

*Companies were 2.3 times more likely to disclose to CDP after being targeted by financial institutions participating in the NDC Campaign. More information on NDC Report 2022.