Paris Maligned II: Climate alignment assessments reveal oil and gas company transition risk exposure

The window of time to achieve the goals of the Paris Agreement is rapidly shrinking, and yet oil and gas companies are still failing to take the requisite actions to align their activities with Paris.

Meanwhile, investor demand for assessments of climate alignment is growing: more and more investors with a ‘universal owner’ investment perspective are recognising the risks that climate change poses to their wider portfolios, while others are seeking for their investments to be managed ‘sustainably’.

Investors can also use climate alignment assessments as a proxy for transition risk exposure to low carbon future scenarios.

This report provides investors with climate alignment and transition risk exposures for 25 of the world’s largest listed oil & gas companies.

The note is aimed at portfolio managers, analysts, sustainability & stewardship teams. It provides:

  • Our first Combined Alignment Assessment, which identifies the leaders and laggards on Paris alignment, assessed according to Carbon Tracker’s key metrics:
    • Investment Options
    • Production plans
    • Recent project sanctions
    • Emissions reduction targets
    • Remuneration incentives
  • An update of our least-cost analysis of producers’ upstream projects, revealing the capital at risk and duration risk inherent in portfolios.
  • Key considerations and areas which investors can influence to improve company performance on Alignment and preparedness for a low-carbon future.