Credit ratings, research and risk analysis provider Moody's Investors Service has announced the launch of its first Net Zero Assessment (NZA), its new scoring system that aims to allow investors to evaluate and compare companies' decarbonization plans and actions. .
Officially launched last year, the new NZA provide an assessment of the strength of a company's carbon emissions reduction profile against a global net-zero emissions pathway consistent with the more ambitious goals of the Paris Agreement, taking into account the ambitions of the entity, as well as its plan and governance around emissions reductions. NZAs use a 5-point scale from NZ-1 (highest score) to NZ-5 (lowest score).
For its first NZA, Moody's gave Italian energy infrastructure provider Snam a climate transition plan score of “NZ-3” or “significant”, with the company's ambition rated as “well below 2°C ”, consistent with the objectives of the Paris Agreement. and its implementation as “solid”, with its action plan for Scope 1 and 2 emissions based on proven and easily scalable technology, but partially offset by implementation obstacles for its Scope 3 emissions, including having a relatively high share emissions from sources that are difficult to control.
Brian Cahill, global head of ESG at Moody's Investors Service, said:
“Market participants face considerable challenges in comparing decarbonization plans across companies due to inconsistent disclosure requirements, differences in the magnitude, coverage and timing of targets, as well as differences in the ability of companies to implement their business transformation plans. and meet stated goals. The NZA provides an independent and comparable assessment of an entity’s emissions reduction profile, enabling market participants to better understand the relative positioning of non-financial companies as they transition to a low-carbon future.”
