PWC: In Our Global Sample, the Largest Companies are Three Times More Likely to Have Made a Net-Zero Commitment Than the Average Company.

At the sector level, among those that have made net-zero commitments, energy and power and utilities are the most highly represented. This reinforces the fact that high-emitting (and hard-to-abate) industries are often front and centre when it comes to climate action, placing them in the complex and critical role of being part of both the problem and its solution.

Japan-based conglomerate Mitsubishi Corporation, which has a large energy business, is grappling with these issues head-on. ‘Japan is expected to cover about 40% of its energy demand with renewables,’ explains CEO Takehiko Kakiuchi. ‘Natural gas is vital for the remaining 60%, and while getting to a consensus around offsetting mechanisms is challenging, carbon-neutral LNG [liquefied natural gas] offers a promising solution.’ There are also questions about what will ultimately be both acceptable to other stakeholders and cost competitive. Nuclear power, the most economical option, is fraught. ‘In Japan, nuclear energy provides a veritable source of clean power, but innovative approaches to safety concerns are essential to overcome public opposition.’

Meanwhile, among CEOs of companies that have not made a commitment to achieve carbon neutrality—attained when a company offsets its greenhouse gas emissions to zero (for example, by purchasing voluntary carbon credits)—or a net-zero commitment, 57% indicate that they don’t think their company produces a meaningful amount of GHG emissions. CEOs from the technology (74%), business services (72%) and insurance (71%) sectors were most likely to place themselves in this category.

Many of those companies may be focusing on their Scope 1 (direct) emissions and Scope 2 (indirect from the purchase of electricity, steam, heat or cooling) emissions, as opposed to Scope 3 emissions (those created through the use of their products and across the full value chain, including the contributions of suppliers and other partners). Scope 3 emissions are harder to quantify, and a large number of CEOs report that they lack both the ability to rigorously measure emissions and an established industry-wide approach for decarbonising—highlighting the need for reliable data and consistent processes.