Despite growing political pressure to weaken EU sustainability rules, companies are successfully aligning their climate transition plans with regulatory standards, reveals WWF in a new report.
The findings challenge the narrative that these rules are overly complex or burdensome, demonstrating that businesses are capable of delivering on disclosure requirements without compromising ambition.
WWF finds that the climate transition plans of ten of the largest French companies* assessed in the report ‘Climate Transition Plans: A deep dive into existing practices’ comply with regulatory requirements, and their climate targets align with the Paris Agreement.
Sebastien Godinot, Senior Economist at WWF European Policy Office, said: “While the EU is working hard to weaken important corporate sustainability laws, companies are proving that they can meet the requirements set by the pre-omnibus regulatory framework. This report demonstrates that current attacks on the legislation are not backed by evidence, and are only creating further confusion and delays for companies that have invested and worked to ensure compliance.”
Through this report, WWF also highlights that for corporate climate transition plans to deliver meaningful impact, ambitious action is needed, to address the underdeveloped technology and scarce resources that companies rely on. Currently, it is not uncommon for corporate climate transition plans, although aligned with regulation, to fall short of achieving sufficient progress towards the EU’s climate commitments.
“The solution doesn’t lie in the weakening of these necessary laws – but in their proper implementation,” added Sebastien Godinot.
In addition to the findings, the report issues a series of recommendations for different stakeholders:
- Companies must communicate more quantitative data related to the transition plan financing and locked-in emissions.
- Policymakers, regulators, and financial institutions must incorporate transition plan data into financial ratings, tools and decisions, and develop and enforce policies that facilitate the transition to a low-carbon economy.
- To ensure that this work is carried out based on credible plans, auditors will need to update their practices to better highlight inconsistencies in existing plans and encourage continuous improvement by companies in this exercise.
Climate Transition Plans: A deep dive into existing practices
This report is based on an in-depth analysis of 10 climate transition plans from CAC40 companies, as well as a broad review of regulatory frameworks (ESRS, ATP-Col, ACT) and international benchmarks. It establishes a qualitative methodology for assessing the compliance, consistency, and credibility of the plans, and makes concrete suggestions to different stakeholders to ensure they enable companies to deliver on climate commitments.
* The ten CAC40 companies evaluated in the report are: Accor, Air Liquide, Danone, Engie, LVMH, Michelin, Renault, Sanofi, TotalEnergies, and Vinci.
