The world is way off track to reach its climate goals. Meanwhile, major polluters such as Shell and BP are shifting their focus back to fossil fuels.

London CNN  — 

The vast majority of the world’s biggest companies have done almost nothing in the past five years to cut their planet-heating pollution enough to avoid catastrophic climate change.

Large companies are either more likely to contribute to extreme levels of warming or are not disclosing their greenhouse gas emissions at all, according to a new report from ESG Book, seen by CNN.

The leading sustainability data provider found that the efforts of just 22% of the world’s 500 biggest public companies by market value are aligned with the Paris Agreement, aimed at limiting global warming to 1.5 degrees Celsius above pre-industrial levels. That’s a measly gain from 18% of firms in 2018.

Climate scientists consider a 1.5 degree rise in the average global temperature a key tipping point, beyond which the chances of extreme flooding, drought, wildfires and food shortages could increase dramatically.

Almost half, or 45%, of companies are aligned with warming of at least 2.7 degrees Celsius — a disastrous level of warming that could expose billions of people to dangerously hot conditions. That’s down from 61% in 2018.

“Our data presents a clear message: we need to do more, and we need to do it quickly,” ESG Book CEO Daniel Klier said.

“Without a fundamental change in the way the global economy operates, it’s not obvious how we see a significant shift.”

The report is the latest in a string of evidence that the world is way off track to reach its climate goals. At the same time, major polluters such as Shell and BP (BP) are shifting their focus back to fossil fuel production following a year of bumper profits helped by soaring oil and gas prices.

In its analysis, ESG Book assigned “temperature scores” to companies based on publicly reported emission data and factors such as emission reduction targets to determine firms’ contribution to global climate goals.

The analysis covered companies with a market value of at least $10 billion in the United States, the United Kingdom, China, India and the European Union.

It accounted for direct emissions from operations as well as indirect emissions from use of the companies’ products. This is particularly important for oil and gas firms as most of their emissions are generated from the burning of their products such as gasoline and jet fuel.

In the UK, India and the EU, the number of companies with emission reduction targets aligned with the Paris Agreement has barely budged since 2018.

Progress in the United States and China has been better, although off a lower base.

In the United States, 20% of companies are Paris-aligned, up from 11% in 2018. In China, 12% are Paris-aligned, compared with just 3% five years ago.

“The encouraging thing is we know what levers to pull, and a lot of these companies are now much more active. But as the data shows, we’re not necessarily all moving at the right pace,” Klier told CNN.

In his view, a combination of more stringent government policies, changes to consumer behavior and technological breakthroughs will be required to bring about a meaningful shift in the current climate trajectory.

Institutional investors, such as pension funds, also have an important role to play in directing more capital toward renewable technologies, he said.

There are signs this money flow is gathering pace. According to the International Energy Agency, investment in solar power is set to overtake investment in oil production for the first time this year.

“For every dollar invested in fossil fuels, about $1.7 are now going into clean energy. Five years ago, this ratio was one-to-one,” IEA executive director Fatih Birol said in a report last month.

Still, slightly more than $1 trillion is expected to flow toward oil, gas and coal this year, significantly above the level consistent with the world reaching net-zero emissions by 2050, the IEA said.

There is now a 66% chance the planet’s temperature will rise above the 1.5 degrees Celsius of warming for at least one year in the next five years, the World Meteorological Organization said in a report in May. While that would only be a temporary breach, it would be the clearest signal yet of how quickly climate change is accelerating, leading to a rapid rise in sea levels, more extreme weather and the demise of vital ecosystems, the group said.

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