The global plastic industry’s long-standing narrative of recycling as the panacea for plastic pollution has been debunked in a new report by Planet Tracker.
Many CEOs have released climate change targets, some of which aim to be 1.5°C aligned by 2030 and/or net zero by 2050. More recently, nature transition plans are being developed with a goal of becoming nature positive. Investors and lenders need to understand how these pathways will be achieved and calculate the appropriate risks and opportunities against a fluid policy and regulatory backdrop.
Unilever recently revised its ESG targets. Of its original 27 goals, at first glance it looks as though 10 were dropped. But closer scrutiny reveals some objectives are new and others have become divisional. In this paper, Planet Tracker explains why this is not a cause for despondency and demonstrates that if a corporate’s sustainability goals are adjusted, they should be scrutinised and judged on their own merits.
In late April 2024, Unilever (ULVR) adjusted its corporate sustainability goals. This change generated significant interest and commentary. The Planet Tracker dashboard analyses the changes announced by the management team in detail.
The chemical industry, generating USD 5.7 trillion in annual revenues (2022) and directly employing over 15 million people, plays a pivotal role in the global economy. Its products are integral to various sectors, making chemical components essential for 96% of all manufactured goods.
Planet Tracker’s report, Tomorrow’s Chemistry, presents a comparative analysis of the Climate Transition Assessments (CTAs) of seven leading chemical companies, Air Liquide (AI), BASF (BAS), Bayer (BAY), Dow (DOW), Incitec Pivot (IPL), LyondellBasell (LYB), and Toray Industries (3402), shedding light on their commitments, strategies and readiness to align with the Paris Agreement and achieve Net Zero emissions by 2050.
The US Environmental Protection Agency (EPA) issued its Final Rule for Synthetic Organic Chemical Manufacturing Plants & Polymers & Resins. The aim of this rule is to reduce cancer and serious health effects from toxic air pollutants and smog-forming compounds. This is relevant to financial markets which are seeing externalities being converted into internal costs for corporates. Financial models may need reassessing.
Unilever’s 2024 Climate Transition Action Plan (CTAP) aims for alignment with global climate targets, focusing on the 1.5°C pathway of the Paris Agreement.
Planet Tracker’s evaluation highlights Unilever’s revised targets and strategies for mitigating climate change impacts, noting the plan as a significant step forward.
However, Planet Tracker suggests more detailed financial disclosure to link investments to outcomes and clearer explanations of financial forecasts for investor understanding.
The TNFD issued its final recommendation on nature-related financial disclosures in September 2023. Even the earliest TNFD adopters will not have to publish such disclosures until 2025, for the 2024 financial year. However, companies can no longer claim they lack guidance on nature reporting. Investor initiatives such as the Nature Action 100 and PRI Spring Initiative provide significant opportunities for financial institutions to press companies for progress.
Planet Tracker analysis of Bayer filings and presentations (e.g. annual reports, earnings calls, shareholder meetings) demonstrates that mentions of litigation have risen since 2020, notably in the annual report. On earnings calls, where analysts are given an opportunity to question the management team, it is also being raised. This hints that the ongoing threat from litigation is seen as of significance to the financial market valuations.
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