Climate change represents a systemic risk, with far-reaching economic impacts, reshaping regulation, capital allocation, and business models worldwide. This makes credible action, rather than ambition alone, necessary. Transition planning is a core marker of resilience and preparedness, showing how companies intend to navigate and shape the economies of the next decade. Our assessment covers the transition plans of 1,600 real-economy companies, whose operational[1] emissions alone equate to at least 25% of global energy-related emissions, a number which potentially grows substantially to 55% if value chain emissions are also considered, although this figure is harder to calculate due to overlaps. This underscores how corporate choices will influence the pace and direction of the global transition. 

Scaling what works: An attainable way to invest in climate transition

Financial planning and disclosure give substance to transition plans, revealing whether decarbonisation is genuinely embedded in company strategy, capital allocation and day-to-day decisions. Each year, the world's most influential companies report deploying about USD 3.2 trillion in capital expenditures (CapEx), yet only a median 7% is directed towards low-carbon investments, highlighting how far the transition still has to go.

Among the 25% of companies that reported low-carbon investments, many already allocate expenditures well above the median, with low-carbon investment shares reaching up to 30% of total CapEx. This is occurring across a wide range of countries and 19 industries, spanning oil and gas, chemicals, and construction materials to freight, real estate, utilities and automotive. This breadth demonstrates that such investment levels are not confined to traditionally ‘easy’ sectors but are grounded in technologies that can be adopted across sectors, regions and markets. They reflect the deployment of existing low-carbon technologies that are commercially available today and transferable across regions, even if deployment variations exist due to policy, market or reporting differences. They include low-carbon and electrified transport, low-carbon steel, green ammonia and fertilisers, battery and hydrogen production, regenerative agriculture, renewable energy and construction. 

If all assessed companies move towards 30% in low-carbon investment, it would unlock roughly USD 1.3 trillion in annual low-carbon spending globally. This would be around 30% of the USD 4.5 trillion that the International Energy Agency (IEA) estimates is needed annually by 2030. This indicates that meaningful progress in financing the transition can be achieved in the near term through deliberate capital allocation to scale existing solutions. Over the longer term, higher investment levels, including those needed to develop and deploy new technologies, will also be required.

Reaching these levels is not a matter of marginal or discretionary spending. It requires companies to actively restructure capital expenditure over time, shifting investment away from carbon-intensive assets and activities as part of their climate transition planning. This makes transparency of capital and operational spending, research and development for transition solutions, and revenue from low-carbon activities increasingly critical. Such disclosures enable investors, policymakers and other stakeholders to assess whether companies are aligning resources with stated climate ambitions, to track the pace of change, and identify where additional pressure or support is needed to remain on a 1.5°C-aligned pathway.

Emissions reductions aligned with 1.5°C remain marginal compared to the emissions companies directly control

Financing the transition is only meaningful if it delivers measurable emissions reductions: capital reallocation signals intent, but only sustained, near-term emissions cuts determine whether the global carbon budget remains viable. While 381 companies were found to be aligning operational emissions with sectoral 1.5°C pathways, their operations represent less than 4% of global energy-related emissions. This contrasts with the much larger share of global emissions — around a quarter — that the assessed companies directly influence. This is a tremendous, missed opportunity, as failure to deliver emissions reduction early on means that larger reductions are needed later, to compensate both for the cumulative effect of delayed reductions and the additional emissions released meanwhile.

Still, a significant number of the world’s most influential companies have aligned their operational emissions with their relevant sectoral 1.5°C pathway. This demonstrates that targeted emissions reductions are already achievable across sectors and geographies with real-world examples showing that even high-emitting, hard-to-abate industries can make rapid progress when ambition is matched with investments and action.

Setting a baseline for action

Our finding points to a straightforward imperative: companies must set science-aligned targets backed by credible transition plans that combine absolute emissions reductions with the investments needed to deliver them. Establishing a baseline level of low-carbon investment, expressed in a clear percentage of revenues, enables companies to translate ambition into action while collectively narrowing the global transition funding gap. At the same time, investors, regulators and civil society need to reinforce this shift through incentives and oversight that keep companies on track.

Encouragingly, many companies are already meeting substantial levels for low-carbon investment, proving that targeted action is both feasible and widely attainable. If all companies take that step from passive commitment to proactive investment, the cumulative effect would be a substantial acceleration of real-economy decarbonisation. Because every incremental dollar spent helps bend the global emissions curve and strengthens the foundations of a more resilient, low-carbon global economy.

[1]  Operational emissions here refer to scope 1 and scope 2 emissions, in line with the GHG Protocol. Aggregated value chain (scope 3) effects are not calculated due to modelling uncertainties as value chains overlap.