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The EU’s decision to roll back some of its corporate sustainability reporting rules will have been a welcome move for European companies that have complained of overregulation.
Policymakers insist they are sticking to ambitious climate goals established under the EU’s Green Deal. Yet there are fears that the bloc’s efforts to ease the regulatory pressure on businesses by watering down green policies risks causing confusion — and even a retreat from transparent reporting.
Europe has made significant leaps forward in the green energy transition in the past few years. But how companies in the region respond to the latest EU changes on reporting, and to the broader shift in sentiment following US President Donald Trump’s deregulation drive and pullback on green policies, will be telling.
The fifth edition of Europe’s Climate Leaders — compiled by the Financial Times in partnership with data provider Statista — aims to highlight European companies that are making progress in cutting greenhouse gas (GHG) emissions.
The list focuses primarily on businesses that have achieved the greatest reduction in their Scope 1 and 2 GHG emissions intensity over a five-year period (2018-23 for this edition).
Scope 1 and 2 emissions — “core emissions” in the table — come respectively from a company’s own operations and from the energy it uses. Emissions intensity is defined as Scope 1 and Scope 2 emissions, in tonnes of CO₂-equivalent, per €1mn in revenue.
Other factors are considered, such as transparency on Scope 3 emissions, which arise from a company’s supply chain and typically make up the bulk of corporate carbon emissions. Companies’ progress in reducing absolute emissions, and their collaboration with sustainability assessors, such as CDP and the Science Based Targets initiative (SBTi), are also taken into account.
These additional factors are assigned a score, which is combined with the reduction in emissions intensity figure, to produce an overall total for each company. Further details of the methodology can be found in the panel at the end of this article and on Statista’s website.
This year, the highest-scoring company is Tele2, a Swedish telecommunications company, with 87.5 points. UK asset manager Intermediate Capital Group and Italian energy company ERG are joint second, with 86.2 points each.
As in all previous years, financial services accounted for the greatest number of companies in the list, this time 10 per cent of them. Next came construction and building materials (8 per cent), then transport, logistics, and packaging (7 per cent). The UK was home to the greatest number of companies — 22 per cent — followed by Italy (13 per cent) and Germany (12 per cent).
The availability of corporate emissions data has increased every year. The 2025 list comprises 600 companies, from an initial longlist of about 2,000. To be included, companies must meet a key threshold of reducing their core emissions intensity by more than 3 per cent a year.
The Climate Leaders methodology prioritises Scope 1 and 2 emissions because it is mandatory to report these, so data is both readily available and comparable. Companies’ Scope 3 emissions are typically far greater but, because reporting remains voluntary and there is no standard metric, definitive comparisons are harder to make — hence the focus on transparency instead of absolute numbers.
It is possible for a company’s absolute emissions to increase even as it reduces its emissions intensity. In recognition of this, companies’ progress in cutting absolute emissions has been factored into the scoring, and this year we excluded any companies that have increased their absolute emissions by more than 30 per cent.
Absolute emissions are represented in the list by negative figures in the “total reduction of core emissions” column.
The methodology for this annual list is under continuous review as the reporting of emissions data evolves.
Sometimes, companies’ own carbon accounting, whether cited in corporate reports or submitted to CDP, may be inconsistent or lack key details. To mitigate this risk, the figures reported for 2018 and 2023 by the biggest emissions cutters, in terms of both intensity and absolute emissions, have also been scrutinised by GreenWatch, a sustainability research team based at University College Dublin. Its findings have been added to the table as footnotes.
The editors reserved the right to exclude companies if their broader environmental record — on non-GHG pollution, for example, or deforestation — was sufficiently disputed to undermine any claim to be a “climate leader”. Energy companies prospecting for new fossil fuel reserves and businesses censured by regulators for greenwashing fell into this category, as did banks increasing their financing of fossil fuels.
A print and online report on Europe’s Climate Leaders will be published on May 22, featuring a series of articles
Read the full article here