The pace of decarbonisation by global listed companies is slowing, and more greenhouse gases (GHG) are being emitted than last year, an MSCI study has found.

The latest MSCI Net-Zero Tracker found listed companies are likely to put 12.4 gigatons of GHG emissions into the atmosphere this year, up 11% from 2022. This would need to fall by 43% this decade to limit the temperature rise to 1.5°C.

“At their current rate of emissions, listed companies would use up their share of the global carbon budget for keeping the rise in global temperatures below 1.5°C by April 2026, three months sooner than we projected in July,” it said.

Last year’s study showed listed companies were on course to emit 10.9 gigatons of Scope 1 GHG emissions, which implied a temperature rise of 2.9°C by 2100. In an interview with ESG Clarity, MSCI executive director, climate change investment research Sylvain Vanston called these findings “very concerning”.

This year’s findings exceed even that, despite projected warming dropping from 3 degrees to 2.5 degrees.

Half of all companies (55%) are on track to keep warming below 2°C and 22% are aligned with a 1.5°C temperature rise, however just 34% have set net-zero targets, down from 46% MSCI found to have done in last year’s study.

“Despite progress, the world has not moved the needle enough to be on track to achieve 1.5°C,” said Linda-Eling Lee, founding director and head of the MSCI Sustainability Institute.

“Following a strong start, progress from listed companies in the remainder of the decade is set to slow now that the low hanging fruit has been picked.

“The risks to society, the global economy and our planet require urgent action from the inextricably linked private and public sectors, particularly if the ambition and effectiveness of commitments varies globally and existing measures are falling short.”