Institutional Shareholder Services’ (ISS) responsible investment arm, ISS ESG, announced that it will launch of Net Zero Solutions, a new suite of tools aimed at enabling investors to assess the alignment of their investments with a 2050 net zero scenario.
The suite of solutions comes as investors are increasingly setting targets to reduce portfolio emissions to net zero by 2050, requiring additionally clarity on the goals and progress of their portfolio investments. While many companies have recently announced their own net zero ambitions, many of the goals are either not science-aligned, or company actions are insufficient to reach those goals. In September, the Science Based Targets initiative released study results that found that of the more than 4,200 companies in the G20 that have set climate targets, only 20% are science-based. Similarly, a report from professional services firm Accenture found that the vast majority of companies are not on track to hit their net zero climate goals.
ISS ESG Net Zero Solutions, anticipated for launch in Q1 2022, will provide coverage of 29,000 issuers for Climate data, 23,000 issuers for Energy and Extractives data and 8,000 issuers for EU Taxonomy eligibility data. The suite will include “Issuer Level Net Zero Alignment Data” to identify positive and negative performing companies against a range of climate metrics, and “Net Zero Portfolio Report,” which will provide an aggregated view of a portfolio’s readiness for net zero, encompassing emissions disclosure performance, fossil fuel exposure, potential future performance, climate mitigating revenue and target setting.
Dr. Maximilian Horster, Head of ISS ESG said:
“ISS ESG Net Zero Solutions supports investors in identifying the most suitable KPIs, analysis, and data to transition portfolios and set relevant net zero targets in accordance with their net zero initiatives, and will enable them to provide meaningful Net Zero statements through a data driven approach with automated portfolio reporting.”