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Less than a fifth of the FTSE100 are on track to meet their net zero targets, finds AI model

  • Data by Permutable AI has found that less than a fifth (15) of the FTSE100 are on track to meet their set net zero targets. 
  • Over half* of the FTSE100 do not have any publicly available data on their net zero targets. 
  • Of the companies that are reporting on short-term, long-term and net zero targets combined (56) more than half (34) will fail to achieve at least one**according to the AI model.
  • The latest developments in AI technology are powering the fight for the planet’s future and holding the world’s biggest polluters to account. 

An AI language model created and developed by Permutable AI has found that less than a fifth of the FTSE100 are on track to meet their net zero ambitions. These net zero targets are externally reviewed and validated by the Science Based Targets initiative (SBTi).

Permutable AI is using AI for good to monitor ESG commitments and corresponding emissions data to encourage some of the world’s most influential companies to take climate action seriously.

Permutable’s AI technology has been able to track the specific number of announcements that each of the current FTSE100 organisations have made over the last 10 years. This includes any announcement in  relation to achieving carbon neutral status, net zero ambitions and setting emissions targets (for scopes 1, 2 and 3). The extensive dataset, collected using an AI-driven language model has also been able to deduce the feasibility of the FTSE100 in achieving these targets.

While more than half of the FTSE100 do not have data available on their net zero targets specifically, 56 companies do have readily available data on their short-term, long-term and net zero targets combined. However, of these 56, 34 of the companies cannot feasibly achieve at least one of their targets.**

It is also worth noting that half (50) of the index are also not setting verified SBTi targets.

The data also comes at a significant time when the Competition and Markets Authority (CMA) has launched several inquiries into the accuracy of green claims made by UK organisations, including opening an investigation in January of this year into the accuracy of eco-statements made within the FMCG sector.

The Advertising Standards Authority (ASA) also recently pledged to ban ads that feature the terms ‘carbon neutral’ and ‘net zero’ unless companies can thoroughly back up their claims. Shell became its most recent victim in June when an ad campaign promoting its green initiatives was banned by the ASA for failing to tell consumers that most of Shells’ business is based on environmentally damaging fossil fuels such as petrol.

Discussing the data and the role AI has played in identifying the FTSE100 at greatest risk of sanctions, Wilson Chan, CEO and founder of Permutable AI, said: “AI is going through another global boom right now. While some people are concerned about the negative impact, our data proves that it really can be a powerful tool for good; one that will be integral in helping us to navigate the climate emergency.

“We know that in today’s sustainable investment market, ESG and green claims are under increasing and immense scrutiny from institutional investors, regulators and customers, and companies need evidence to support their claims.”

“Our AI language models have been trained to recognise patterns and spot anomalies within an organisation’s communications around its green initiatives and it’s clear that a significant number of the FTSE100 are either not doing enough, are failing to set verified SBTi targets, or are misleading the public about the steps that they are taking.

“In a time when the world is not on track to meet the goals of the Paris agreement and limiting global warming to 1.5 degrees, it’s even more distressing that some of the world’s most influential companies are failing to take serious action. These companies must act now, start accurately tracking their emissions and set achievable targets to move in the right direction ”

 

Commenting on these findings, John Willis, Director of Research at Planet Tracker, said: “This report shows the importance of closely examining the data behind climate claims. When corporates make misleading statements about their climate strategies and targets, the risks have dramatically risen in recent months. Two sets of regulators are looking into this, consumer and financial ones.

“Quite rightly, climate and environmental statements have to be backed up with evidence. This AI analysis suggests that many UK organisations should be thinking hard about making net zero commitments based on their present publicly available data. Furthermore, if this is the case, investors owning them in sustainable funds may also be at risk of greenwashing.”

 

To find out more about Permutable AI, visit https://permutable.ai/.

 

References

*’Over half’ – this figure is given as we would assume there are 54 other companies included in the FTSE100. However, Permtuable’s dataset spans across 10 years and those in the FTSE100 may have changed.

 

**’fail to achieve at least one’ – The data set reveals that 56 companies are disclosing data for short-term, long-term and net zero targets combined and of this number, 34 are not set to achieve one or more of their set targets.