NewClimate Institute Report: Major Corporations Fall Short on Paris Agreement Alignment, Urging Stronger Climate Accountability
Key Insights
The 2025 Corporate Climate Responsibility Monitor reveals that most major global companies' climate strategies fall short of Paris Agreement alignment despite growing awareness.
The report highlights critical gaps in transparency and integrity of corporate climate pledges, emphasizing that traditional GHG targets are insufficient without transition-specific metrics.
Only a few companies, such as H&M Group, Stellantis, and Apple, demonstrate 'moderate' integrity, while most sectors show limited progress in deep decarbonization.
The CCRM calls for urgent revisions to sustainability standards by 2025/26 to ensure more robust, verifiable, and short-term emission reductions across industries.
The NewClimate Institute's 2025 Corporate Climate Responsibility Monitor (CCRM) reveals that despite increasing awareness, many major global companies continue to fall short in aligning their climate strategies with the Paris Agreement's 1.5°C goal. The comprehensive report, which assessed the climate strategies of 55 leading firms, highlights critical gaps in the transparency and integrity of corporate climate pledges, urging a fundamental reorientation towards verifiable, short-term emission reductions.
Frederic Hans of the NewClimate Institute stated, "While awareness of what constitutes credible corporate climate action is growing among companies and standard setters, even the most ambitious companies often fail to align their business models with the speed and scale needed to meet the Paris Agreement’s 1.5°C goal." The CCRM found that incomplete emissions disclosure, sector-specific accounting malpractices, and data limitations consistently undermine the ability to accurately assess the true meaning and progress of corporate targets. None of the 20 companies subjected to deeper sector-specific analyses demonstrated a climate strategy of 'reasonable' or 'high' integrity. Only a select few, including H&M Group, Stellantis, and Apple, achieved a 'moderate' integrity rating, attributed to early progress on robust strategies and piloting high-integrity approaches.
The report underscores that conventional greenhouse gas (GHG) emission reduction targets are no longer sufficient on their own. It advocates for the integration of transition-specific alignment targets, which directly reflect a company’s key decarbonization pathways and should become a cornerstone of credible climate strategies. Notable examples of such targets include Stellantis and General Motors’ commitments to electric vehicle sales, Google and Microsoft’s pioneering 24/7 carbon-free energy strategies, H&M’s pledge for 100% renewable electricity across its supplier base by 2030, and Danone’s target to reduce methane emissions in fresh milk production.
Sector-specific deep dives revealed persistent challenges. In the food and agriculture sector, assessed companies like Danone, JBS, Mars, Nestlé, and PepsiCo showed initial steps but largely fell short on supporting key transitions such as shifting to plant-based protein and reducing fertilizer use. The tech sector, including Amazon, Apple, Google, Meta, and Microsoft, faces scrutiny due to surging energy demand and outdated emissions accounting, despite some leadership in hourly renewable energy matching. Fashion companies like Adidas and H&M Group showed limited integrity, often relying on false solutions like biomass. In automotive manufacturing, only Stellantis presented a credible short- or long-term climate strategy among the assessed firms, including Ford, General Motors, Toyota, and Volkswagen, with critical areas like battery production emissions largely unaddressed.
The CCRM concludes by calling for significant revisions to key sustainability standards in 2025/26. These revisions must reorient the corporate accountability system towards achieving short-term, structural emission reductions. Strengthening guidance on sector-specific transitions, resolving technical ambiguities, and limiting undue corporate influence are identified as critical steps to ensure credible and effective corporate climate action moving forward.