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  • Writer's pictureAmpersand Partners

Net Zero barometer: assessing progress in the business world



It has been over seven years since the adoption of the Paris Agreement in December 2015. What actions has the business world taken towards achieving Net Zero emissions, and what progress has been made thus far?

In this article, we will provide an overview of the targets, emission reduction progress, and key drivers forming the high-level barometer of Net Zero trends.

Targets are on the rise


The number of large corporates and financial institutions setting Net Zero targets is accelerating.


Number of companies and financial institutions with near term SBTi target status as committed or targets set (excl. SMEs)

1. 2023 YTD: by 2023.04.31

Source: SBTi official website; company annual reports; company sustainability reports; company official websites; macrotrends.net


Despite the acceleration, companies with Net Zero targets remain in the minority.

Percentage of listed companies with self-declared Net Zero targets by GICS sector

1. Data as of 2023.03.31; 2. The GICS* structure comprises 11 sectors, 24 industry groups, 69 industries and 158 sub-industries

Source: The MSCI Net Zero Tracker, May 2023


To achieve a 2-degree scenario or preferably a 1.5-degree scenario, it is crucial for companies to maintain momentum and ensure the conversion from commitments to settingtangible targets continues to increase rapidly the coming years.

Emissions are visibly falling


Is setting a public Net Zero target a symbolic gesture, or are companies taking actions to fulfil them?


So far, we see that the first movers have made visible progress in GHG emissions reduction, in terms of both absolute amount and emission intensity.


Absolute amount of Scope 1 + Scope 2 GHG emissions and emissions intensity of 24 companies2 that set science-based targets in 2015-2017

1. 2023 YTD: by 2023.04.31; 2. 24 companies include all companies and financial institutions (excl. SMEs) that set science-based targets in 2015-2017 and disclose GHG emissions data and reverse data since FY2018

Source: SBTi official website; company annual reports; company sustainability reports; company official websites; macrotrends.net


If a similar pattern applies to companies that set science-based targets in later years, a meaningful reduction in GHG emissions collectively could be expected ahead of the 2030 milestone year. Ampersand will continue to monitor the trend on an annual basis.

Key drivers are strengthening


Government policy


Governments are the NO.1 driver behind companies’ actions. They send strong signals by making country or region-level commitments and establishing systems to help achieve the targets set.

65% of countries have made Net Zero or similar commitments.


Number of countries with target year set on carbon neutrality, climate neutrality, GHG neutrality, Net Zero, zero carbon, or 1.5C target

1. 2023 YTD by 2023.04.31; 2. countries with emissions intensity target, emissions reduction target, reduction vs. BAU commitments only are classified as no targets in this chart

Source: UN website, zerotracker.net, desk research


Among these, all G20 countries except for Mexico have set target years. (G20 countries collectively account for ~80% of global GHG emissions.)


1. 2023 YTD by 2023.04.31; 2. countries with emissions intensity target, emissions reduction target, reduction vs. BAU commitments only are classified as no targets in this chart

Source: UN website, zerotracker.net, desk research


In terms of systems, the Emission Trading Scheme (ETS) has been a powerful system to drive emissions reduction via its cap-and-trade mechanism.

The top 3 emitters in the world (EU, US, China) all have adopted such a system and gradually expanded its coverage. Industries not covered in the current phase should be aware of the trend and prepare in advance.




Capital Markets


Apart from governments, the capital market is another key driver through setting disclosure requirements for companies.


Major stock markets(~70% of global market capitalization)all have some form of climate-related disclosure policy.


1. Major stock markets refer to large stock exchanges in the four regions, include: NYSE, NASDAQ, Shangai Stock Exchange, Shenzhen Stock Exchange, Hong Kong Exchanges (HKEX), Euronext, Japan Exchange Group (JPX)

Source: SEC website; NYSE website; NASDAQ website; HKEX website; CSRC website; Euronext website; finance.ec.europa.eu; FSA website


Disclosure requirements follow a tightening trend, evolving from voluntary to mandatory, expanding in scope, and calling for more ambitious plans.


1. Major stock markets refer to large stock exchanges in the four regions, include: NYSE, NASDAQ, Shangai Stock Exchange, Shenzhen Stock Exchange, Hong Kong Exchanges (HKEX), Euronext, Japan Exchange Group (JPX)

Source: SEC website; NYSE website; NASDAQ website; HKEX website; CSRC website; Euronext website; finance.ec.europa.eu; FSA website


The time to act is now


With these key forces in play, corporates will need to move both faster and smarter on Net Zero in the years to come.


We will continue to monitor key trends in future blogs. Follow us on LinkedIn or our official website for updates.

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