84% Of Companies Accelerating Climate Targets: PwC

A new report by professional services organization PwC has found that nearly all public companies are holding firm or intensifying their climate ambitions, with companies more than twice as likely to be increasing their emissions reduction targets than to be reversing them. Based on evidence from environmental disclosure platform CDP, the report says that setting climate targets is also becoming a wider practice beyond large businesses, with smaller companies increasingly adopting sustainability targets.

PwC's 2025 State of Decarbonization took a look at 4,163 public company responses to the 2024 CDP disclosure cycle. The research utilized GenAI to assess more than a million qualitative long-form text and quantitative answers supported by data from third-party sources like S&P Capital IQ, the Science-Based Targets initiative, and other public records. In spite of fears that corporate sustainability initiatives are slowing down, the results indicate otherwise: 47% of firms maintained their decarbonization goals in 2024, and 37% increased their ambitions. Just 16% lowered their climate goals, with most of these companies modifying goals that were originally established without a clear plan.

Among the highlights of the trend in the report is the constant rise in corporations establishing new Scope 1 and 2 emission reduction targets. The figure increased steadily over the last seven years, with 14% of growth in 2024 alone, raising the number to 1,293 companies from 1,132 in 2023. Below 500 corporations had such goals in 2020. However, while more companies are committing to emissions reductions, the total emissions covered by these new targets declined in 2024 to approximately 1.1 billion metric tons of CO2e, down from over 2 billion tons the previous year. PwC credits this decrease to increasing involvement of smaller businesses, since the average revenue of companies announcing new climate targets fell to $1.3 billion in 2024 from $3.8 billion in 2020.

The report also points to a rising emphasis on value chain emissions, with businesses increasingly involving their suppliers and customers to minimize overall carbon footprints. As the findings reveal, 72% of companies are now actively collaborating with their suppliers on sustainability initiatives, while 67% are working with customers and clients. This increased focus on Scope 3 emissions is evident through the increasing number of companies disclosing these emissions, which jumped by 80% in 2024, with more than 3,600 companies publishing their Scope 3 data compared to approximately 2,000 the year before.

While this progress was made, the report discovered that merely 54% of firms are presently in line to realize their Scope 3 emissions reductions targets. That said, this percentage has risen marginally from 50% in 2023, suggesting some improvement. The achievement rate of operational and energy-related emissions cuts (Scope 1 and 2) was much better, with 67% of firms being in line to realize their targets. Among these, Scope 2 emissions, which were mainly tied to purchased electricity, decreased at a faster rate, with corporations reporting a 12% fall in 2024. Scope 1 emissions, which are directly from business operations, fell by 6%.

PwC's report highlights the significance of renewable energy in driving emissions reductions, with the transition to low-carbon electricity representing over 40% of Scope 1 and 2 emissions savings in 2024. Although this transition has been successful, the report indicates that companies will have to pivot towards decreasing direct Scope 1 emissions to continue the pace of decarbonization.

As more businesses make sustainability commitments, they are also gearing up to spend heavily on climate action. PwC's research revealed that companies anticipate spending 18% more of their capital expenditures (capex) and 21% more of their operating expenses on climate adaptation and mitigation by 2030. The spending is being fueled by both regulatory forces and the identification of business opportunities in sustainability.

The study points out that 60% of businesses already have low-carbon products within their product portfolio, and according to PwC's research, products driven by sustainability may bring an additional financial boost of 6% to 25%. Furthermore, businesses working towards Scope 3 emissions reductions may experience additional financial gains since lowering energy and material consumption during manufacturing can decrease costs and increase profit margins.

Overall, PwC’s findings challenge the narrative that businesses are retreating from sustainability commitments. Instead, the report paints a picture of continued progress, with more companies setting ambitious climate goals, increasing engagement with their value chains, and recognizing both the financial and environmental benefits of decarbonization. While challenges remain, particularly in Scope 3 emissions reductions, the data indicates a growing momentum toward a more sustainable corporate landscape.