- Companies in emerging markets will benefit from the recent agreement at COP29 in Baku [1] that will triple climate finance to developing countries from the previous goal of US$ 100 billion annually, to US$ 300 billion annually by 2035. Moreover, multilateral development banksopens in a new tab at COP29 have pledged to increase climate finance for low- and middle-income countries to US$ 120 billion annually by 2030 [2].
- The decarbonization challenges outlined in the study echo the recent KPMG 2024 CEO Outlook report which found that for 30% of survey respondents, the greatest barrier to achieving climate ambitions is the complexity presented by decarbonization of their supply chain [3]. Standardizing metrics and improving transparency in reporting, particularly for Scope 3 emissions, will facilitate better benchmarking and informed decision-making.
- Study findings are consistent with our recent “Survey of Sustainability Reporting 2024”, which shows around half of the globally largest 250 companies across 58 countries now report on biodiversity. However, as growth has been slower in the last two years, companies may require technical support to increase their biodiversity and nature-based solutions efforts which would also facilitate access to nature-driven capital sources where needed as well.
- As for the gender and social targets and disclosures, transparency related to gender diversity targets could be improved across sectors and gender diversity across all employee categories could be further enhanced within water & waste, TMT, and transport sectors.
Introduction
The last five years has seen a rapid evolution in sustainability strategies for infrastructure and energy companies. We recently conducted a study with the International Finance Corporationopens in a new tab (IFC) of more than 100 companies that operate in emerging markets to identify trends in sustainability priorities, reporting practices and how strategies are anchored and financed at these companies.
Methodology
The study included 104 companies across six sectors: Energy, Technology, Media, and Telecom (TMT), Transport, Mining, Water & Waste, and “Cross-Cutting” companies with operations across more than one sector. Data was gathered from publicly available documents, company websites, and databases like S&P Capital IQ and LSEG Data & Analytics. This information was analyzed using a sector performance model developed by KPMG which considered 51 KPIs across Strategy, Governance, KPI & Data Reporting, Environmental, Social, and Community Benefit-Sharing.