Since the 2015 Paris Agreement, a growing number of states and firms have adopted targets to reach net zero emissions. These pledges vary significantly both in the timing of adoption and in robustness – measured by whether they adopt procedural best practices. We introduce a novel time-series dataset measuring the uptake and robustness of net zero targets of states and the world’s largest listed firms between 2015 and 2023. The new data allow us to identify patterns that speak to a key debate in the literature: what explains the rapid uptake of net zero targets by firms and countries? Descriptive inference yields several insights. First, the timing of net zero adoption by both states and firms strongly tracks international mobilization efforts, highlighting the importance of the United Nations (UN) process for target setting. Second, on average, firms set targets before countries. Third, there is an increase in some best practices for companies, such as setting interim targets and including Scope three emissions in targets, alongside a lack of progress in others, such as safeguards on the use of offsetting. Importantly, we do not find significant variation in timing or robustness of net zero pledges across firms in different sectors. For countries, early adopters tend to have more robust targets from the beginning than late adopters, suggesting the latter may be adopting more symbolic targets. In sum, our results show the rapid growth of the net zero wave, but also its limits in driving robust targets.
Authors: Jessica F. Green, Thomas N. Hale, Aldrick Arceo.
