MSCI launched a new tool Monday that shows how far public companies are from meeting the goals of the Paris Agreement to address climate change.
The MSCI Net-Zero Tracker will be published quarterly to show how companies are progressing, or not.
The first Net-Zero Tracker shows that globally, companies' annual emissions are still at 2013 levels, despite the increasing emphasis on addressing climate change.
The MSCI Net-Zero Tracker gauges climate-change progress across a global universe of 9,300 publicly listed companies based on the MSCI All Country World Investible Market index. It will also provide aggregate progress on temperature alignment and highlight industry leaders and laggards.
"The tracker will allow investors to monitor whether listed companies have credible plans to reduce their carbon footprint and track the alignment of their own portfolios with the 2015 Paris Agreement," said Remy Briand, MSCI global head of ESG and climate, in the announcement. So, far the data "shows the need for a dramatic acceleration in action from the world's public companies. For those not matching their commitments or lagging, there should be nowhere left to hide, " Mr. Briand said.
MSCI Chairman and CEO Henry A. Fernandez said in the announcement that along with public companies taking action to drive the transition to net zero, "there needs to be a reallocation of capital by asset owners and an effective channeling of funds by asset managers and banks. This will help reduce the risks of climate change for the world as we all play our part to avert a climate catastrophe."
"Despite the rhetoric since the 2015 Paris Agreement, more immediate action is needed," Mr. Fernandez added.