Key financial metrics related to the climate transition are still under-reported by Fortune Global 500 firms, a new study by Manifest Climate has found.
The study, Mind the Gap: AI Analysis of the Fortune Global 500 Sustainability Disclosures, sought to highlight the ‘gap’ between the sustainability commitments of some of the world’s largest companies and the associated financial transparency.
Having analysed more than 50,000 sustainability-related data points, the study found that while most companies publicly commit to sustainability reporting, very few are disclosing the financial risks and investments associated with it.
Decarbonisation commitments
As an example, while some 88% of the companies have stated their decarbonisation goals, just over half (52%) have reported capital expenditures that align with these goals.
Just 13% of the firms surveyed tie executive compensation to climate performance, while less than 2% quantify financial exposure to transition risks.
As Manifest Climate noted, without meaningful financial information, companies risk ‘eroding the credibility’ of their sustainability strategies. It noted that investors, regulators and decision-makers are increasingly using AI to assess sustainability claims, meaning there are few places for businesses to hide.
‘Cut through the noise’
“Technology now allows us to cut through the noise and pinpoint exactly where companies are backing up commitments with capital,” commented Laura Zizzo, founder and chief strategy officer at Manifest Climate.
“With AI-powered tools like Manifest Climate, we can instantly organise and compare disclosures at an expert level – no manual digging needed. This is a game changer for decision-makers who want to focus on real action, not just promises.”
Manifest Climate’s platform leverages AI trained on more than 1,500 data points aligned with leading sustainability frameworks such as CSRD, ESRS, and ISSB, to benchmark performance, uncover material topics, assess alignment against relevant frameworks, and monitor risks. Read more here.
