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Sustainability-related disclosure. In 2022, out of 43 970 listed companies globally with a total market capitalisation of USD 98 trillion, almost 9 600 companies representing a total market capitalisation of USD 85 trillion disclosed sustainability-related information. The growing urgency in managing climate-related risks and opportunities has generated greater interest by investors about companies’ greenhouse gas (GHG) emissions. Globally, 6 308 companies representing 77% of market capitalisation disclosed scope 1 and 2 GHG emissions in 2022, ranging from 43% of companies by market capitalisation in the People’s Republic of China (hereafter ‘China’) to 92% in Europe. Extractives and minerals processing is the industry with the highest share of companies disclosing scope 1 and 2 GHG emissions by market capitalisation (85%). Companies report scope 3 emissions less often. In 2022, companies representing 60% of market capitalisation reported scope 3 emissions, ranging from 9% in China to 87% in Europe.
Globally, an external service provider assures the sustainability disclosure of two-thirds of the companies that disclose sustainability information by market capitalisation. Among the companies that disclose the name of the independent assurance provider, 82% of the sustainability reports were assured by an auditor and the rest by other assurance providers. The share of companies that hire the auditor of the financial statement to assure their sustainability disclosures varies widely across regions: from 17% of companies by market capitalisation in Japan to 70% in Europe. Globally, among the 2 957 sustainability reports subject to an independent assurance, 1 668 (56%) were partially or fully verified under limited assurance, while 405 (14%) were partially or fully verified under reasonable assurance.
Globally, 70% of companies by market capitalisation disclosed a GHG emission reduction target and nearly half of them set 2030 as the target year. However, the baseline year was available in only 37% of companies with a target, which undermines the ability of shareholders and stakeholders to assess what the GHG emission reduction targets mean in practice for a company.
Investor landscape. Climate change is considered to be a financially material risk for listed companies representing 64% of global market capitalisation. Companies considered to be facing risks related to climate change, human capital and data security have larger market capitalisation than the companies considered to be facing other sustainability-related risks such as ecological impacts or human rights. These shares of market capitalisation can serve as a reference to policy makers identify and justify priorities when supervising and regulating capital markets.
An analysis of the 100 listed companies with the highest disclosed GHG emissions globally shows that institutional investors hold the largest share of the equity (41%) and that the public sector is also an important shareholder, with 18% of the equity. The ownership distribution is particularly relevant when considering the ability of investors to accelerate the transition to a low-carbon economy through successful engagement strategies. Globally, the largest shareholder in each of these 100 highest emitting companies owns on average 24% of the shares, and the largest 20 shareholders own on average 54% of the shares.