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New research from the Science Based Targets initiative (SBTi), a body enabling businesses to set ambitious emissions reduction targets, reveals that none of the G7’s leading stock indexes are currently aligned with a 1.5°C or 2°C pathway and calls on the largest listed G7 companies to urgently increase climate action.

• No major G7 stock indexes are currently on a 2°C pathway or the 1.5°C pathway that is so urgently needed. Four of the seven indexes, including the FTSE 100 and S&P 500, are on dangerous temperature pathways of 3°C or above.
• G7 indexes with a higher share of emissions covered by science-based targets (SBTs) result in lower overall temperature ratings. 71% of Germany’s DAX 30 companies’ emissions are covered by SBTs, resulting in the lowest index temperature rating of 2.2°C, while less than 1% of Canada’s SPTSX 60 companies are covered by SBTs, resulting in the joint-highest temperature rating of 3.1°C.

• Companies with science-based targets are already cutting emissions at scale - and today’s research calls on all businesses to take immediate action to align with a 1.5°C pathway.

In the lead up to the G7 Summit, the analysis shows that the G7 countries’ leading indexes are on an average temperature pathway of 2.95°C, according to their constituents’ current corporate climate ambitions. Stock indexes, composed of stocks of the most significant companies listed on a country’s largest exchange, are vital benchmarks to understand market trends. Notably, fossil fuels are a key contributor to the emissions of all seven indexes, making up 70% of Canada’s SPTSX 60 3.1°C temperature rating and almost 50% of Italy’s FTSE MIB 2.7°C rating.

The full report, ‘Taking the Temperature: Assessing and scaling-up climate ambition in the G7 business sector’ can be accessed here.