2024 CEC Net zero Benchmark Company Assessments
Second Annual Net Zero Assessment of Focus List Companies
- November 7, 2024
TORONTO | Traditional territories of the Mississaugas of the Credit, the Anishinaabeg, the Haudenosaunee, and the Huron-Wendat – Climate Engagement Canada (CEC) is a growing investor-led engagement initiative with 51 institutional investors representing almost $7 trillion focused on driving Canada’s business transition to net zero. The initiative released its second annual Net Zero Benchmark, providing an updated tool for CEC participant investors to frame and measure the success of their engagements with Focus List companies. These companies represent many of Canada’s top reporting or estimated emitters and/or corporate issuers with a significant opportunity to contribute to the transition to a low-carbon future in Canada. The CEC Net Zero Benchmark provides a set of detailed and comparative common standards to support corporate issuers’ progress toward aligning with the Paris Agreement’s ambition, limiting global warming to well below 2 degrees Celsius, while pursuing efforts to limit the increase to 1.5 degrees.
The new assessments, released today, show encouraging results against the Benchmark indicators. The public policy alignment assessments released earlier this year have also been updated. Notable progress in 2024 includes 9 new companies disclosing transition plans detailing the actions they plan to take to achieve their GHG reduction targets, 7 new companies performing scenario analysis, and formal board oversight of climate change across all 41 Focus List companies.
Greater action, however, is needed from companies to support global efforts to limit temperature rise to 1.5°C. Many have yet to set adequately ambitious or comprehensive emissions reduction targets in accordance with their net zero commitments, and companies’ decarbonization plans so far systemically fail to acknowledge their social impacts.
With new year-over-year data, CEC participant investors will continue using the Benchmark for input and discussion in their collaborative engagement activities with Focus List companies. The initiative will provide ongoing insights and input into the Benchmark results, trends and opportunities for collaboration and engagement. These efforts support CEC’s goal of driving dialogue with Canadian corporate issuers to promote a just transition to a net zero economy.
DOWNLOAD THE ASSESSMENTS HERE
Disclaimer: After publication and the company review period deadline, CEC makes no updates to company scores nor incorporates new information into the Benchmark assessments. However, this document may be edited when a specific technical error is found. These edits only address specific technical errors and do not constitute new, out-of-cycle feedback. Please refer to the most recent version of this document as indicated by the Version Log located on the final tab of this document and version number located on the Overview tab.
CEC Benchmark Insights and Roadmap
The Benchmark follows a rigorous evaluation process designed to provide a comprehensive view of each company’s progress in addressing climate-related challenges. Given the specific challenges faced by certain sectors, the results of the Benchmark also reflect the practical implications of addressing the net-zero transition. The Benchmark is provided as a roadmap for Canadian companies and investors, highlighting its purpose as a guiding tool rather than a conventional scorecard. It will be used to foster a constructive dialogue with Focus List companies on areas of strength, areas of opportunity, and areas requiring further effort.
Key Findings
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- Focus List companies made incremental progress on all but 2 of the 10 Benchmark indicators.
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- Over half of companies now have transition plans in place detailing the actions they will take to decarbonize, with nine companies increasing their scoring since last year.
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- Seven new companies performed scenario analysis in 2024, an important step for future-proofing corporate strategies in a rapidly changing landscape of climate risks and opportunities. Over half of companies still need to do so.
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- The number of net zero commitments increased to 20 out of 41 companies. However, over half of companies have yet to set adequately ambitious or comprehensive long-term emissions reduction targets accordingly.
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- Three companies have committed to aligning their capital expenditures with their stated targets, demonstrating that their plans have been costed.
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- Decarbonization plans systematically fail to acknowledge the social impacts, risks and opportunities presented by the activities therein, raising the potential that just transition matters have not been appropriately considered.
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- Transparency on advocacy and industry involvement has improved drastically, with 11 new companies disclosing their climate-related lobbying activities.
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- Accountability for climate action also improved, with formal board oversight in place across all 41 companies, however only 12 have formal assessments for competencies of climate oversight in place.
26 companies have linked executive remuneration to climate change performance, with 21 specifically linking pay incentives to progress on the company’s GHG targets.
For additional information on CEC’s Evaluation Process, Focus List Company Input, Research Partners and Governance, click HERE.
CEC Disclaimer and Data Usage Terms and Conditions
The CEC Net Zero Benchmark does not score or rank corporate issuers, nor does it use overall numeric or alphabetic ratings. Please see both the CEC Disclaimer and the Data Usage Terms and Conditions for additional information.
Note on Bill C-59
The CEC Net Zero Disclosure Benchmark follows a methodology including a June 1st cut-off date for all disclosures and company reports to be considered. Changes to corporate disclosures as a result of Bill C-59 or any other factors after June 1st, have not affected the results of the 2024 CEC Benchmark. All focus list companies are encouraged to continue reporting all critical climate disclosures and note that public disclosure is a requirement for evaluation for Climate Engagement Canada’s 2025 Net Zero Benchmark.
Governance Bodies
Research Partner
Research Collaborator
About Climate Engagement Canada (CEC)
Climate Engagement Canada (CEC) is a finance-led initiative that drives dialogue between the financial community and corporate issuers to promote a just transition to a net zero economy. Through CEC, 51 investor participants (with almost $7T in assets under management covered by the initiative) (a) help Canadian public companies missed by global initiatives successfully evolve their business models and transition toward our country’s climate commitments, and (b) enhance the level of transparency into Canadian climate risk exposure and transition strategies. In 2019, Canada’s Expert Panel on Sustainable Finance made a recommendation to establish a national engagement program to drive a broader and more consistent dialogue with Canadian issuers around climate risks and opportunities (Recommendation 10.2). CEC is a response to that call to action.
Through multi-year CEC engagements, company boards and senior leaders of Canadian companies can learn about the concerns and expectations of the financial sector as they relate to a timely transition to Net Zero emissions by 2050. This includes i) Strong governance frameworks with oversight of climate change risks and opportunities; ii) GHG-emission reduction strategies consistent with the goals of the Paris Agreement; iii) Measurable, sector-relevant targets; iv) Global standard disclosures (e.g., Task Force on Climate-related Financial Disclosures); and, v) Paris Agreement-aligned advocacy activities. CEC is coordinated by its Joint Secretariat: The Responsible Investment Association (RIA) and the Shareholder Association for Research and Education (SHARE). The initiative is also supported by the international investor networks the UN Principles for Responsible Investment (UNPRI) and Ceres.
Media Contact
For media enquiries, please contact: Ady Jonsohn ady@riacanada.ca.