Only 41% of businesses have plans in place to manage climate risks, with some of the worst offenders being the biggest emitters, according to the latest EY global climate action barometer. The report warns that a worldwide failure of businesses to put action plans and financial commitments in place to tackle climate change risks has derailed progress on vital global environmental goals.

EY’s annual barometer assesses the efforts of more than 1,400 businesses in 51 countries, across 13 business sectors, by looking at their transition plans and the information they publish based on the 11 recommendations set by the task force on climate-related financial disclosures.

The study found that the number of businesses providing at least some information on each of the recommended disclosures is at its highest point since the survey began. A score of 100% means information is being disclosed on all recommendations, and this year’s average score is 94% – an improvement in coverage, from 90% in 2023.

However, the quality of disclosures remains low, with the average quality score sitting at 54% – up from 50% last year – indicating that many companies are avoiding sharing detailed information with customers, investors and other stakeholders. Countries and regions with the highest quality disclosure records are the UK (69%), South Korea (62%), Japan (61%), Southern Europe (61%) and Western/Northern Europe (61%), while the Middle East (29%) sits at the bottom of the list.

The latest barometer findings highlight companies’ lack of readiness to meet the goals of the 2015 Paris Agreement, including targets to limit emissions and temperature increases and to strengthen their ability to adapt to the impacts of climate change. Only slightly more than two-fifths of companies (41%) report they have a transition plan in place to help them mitigate the risks of climate change, and while a little more than a fifth (21%) report they do intend to develop one in the future, 38% do not have any intention of doing so.

Among the world’s biggest emitters adoption of transition plans is even lower – only 8% in China and just 32% in the US. By contrast, adoption of these plans in UK and Europe is 66% and 59%, respectively, largely prompted by regulatory regimes.

Dr. Matthew Bell, global climate change and sustainability services leader at EY, said: “Businesses do seem to be taking small steps to improve their reporting on climate risks, but it’s a slow crawl at a time when they need to sprint, and the stakes could not be any higher.

“Companies that are serious about tackling climate change need to move at break-neck speed to put transition plans in place based on targets that are truly stretching. As it stands, they are falling dangerously short, with potentially devastating consequences for their own future, and that of the entire planet.”

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