Decarbonization: What Companies Announced vs What They Did

Corporate climate target-setting surged earlier this decade. The share of tracked listed companies with a net zero target rose from 21% at the end of 2020 to 64% by October 2026, according to the Net Zero Tracker, and its November 2026 review of the 50 largest listed companies found that more than half of the new targets they adopted between 2020 and 2026 came in 2020 and 2021, mostly net zero pledges for 2050 with interim goals for 2030. The distance made them safe to announce.

That distance has closed. The 2030 checkpoints now sit inside most companies' current strategic planning horizon, and the gap between what was announced and what was delivered is becoming visible on a schedule nobody controls. Corporate net zero targets now have a track record, and it is uneven: at S&P 500 companies, emissions from purchased electricity have fallen sharply since 2021, while a majority of those with targets for direct or supply chain emissions report those emissions flat or rising.

This is the defining communications problem in corporate sustainability for the rest of the decade, and it's arriving alongside rules that have made vague answers riskier. Directive (EU) 2024/825, which member states were required to apply from September 27, 2026, addresses claims about future environmental performance in consumer marketing, such as a net zero date. It lists making one without clear, public, verifiable commitments, set out in a detailed and realistic implementation plan with measurable, time-bound targets and allocated resources, and regularly verified by an independent expert whose findings are available to consumers, among the practices that can be judged misleading. California's AB 1305 already requires entities that operate in the state and make net zero or carbon neutral claims there to publish how those claims were determined to be accurate and how interim progress is measured. And the first mandatory emissions reports under California's SB 253, covering scope 1 and 2, carry a November 10, 2026 deadline.

Key takeaways

• The share of tracked listed companies with a net zero target rose from 21% at the end of 2020 to 64% by October 2026, according to the Net Zero Tracker.
• Among S&P 500 companies, median market-based scope 2 emissions fell about 59% from 2021 to 2025, but 58% of companies with scope 1 targets and 62% with scope 3 targets reported flat or rising emissions, according to The Conference Board.
• The GHG Protocol sometimes requires a company to restate its baseline. In its analysis of the 50 largest listed companies, the Net Zero Tracker found that a fifth of the changes that weakened or dropped a target came with no explanation.

Where have corporate emissions cuts actually come from?

Corporate emissions cuts have come at very different speeds depending on the source, and that pattern explains why progress reports look uneven.

Electricity has shown the clearest progress. Switching to renewable power, through procurement or direct contracting, produced the steepest reported declines at large companies. The Conference Board's 2026 analysis of S&P 500 disclosures found that median market-based scope 2 emissions, the measure that counts renewable purchases, fell about 59% between 2021 and 2025, against about 39% on the location-based measure that reflects the grid itself. The sharper market-based decline highlights the role of renewable electricity procurement and other market instruments. Some of those reductions deserve closer scrutiny: part of them came from unbundled certificates, which a 2022 study in Nature Climate Change found had inflated companies' reported progress, because buying them rarely adds new renewable power.

Efficiency, in my experience, delivers steadily and modestly: buildings, logistics, process improvements. There is more to get, but the quick wins tend to go first.

Everything else is hard. Industrial heat, chemical processes, aviation, shipping, agriculture, and the entire supply chain. These are where the remaining emissions sit and where the technology, capital and coordination requirements are genuinely difficult. The same Conference Board analysis found that 58% of S&P 500 companies with scope 1 targets reported flat or rising scope 1 emissions since 2021, and 62% of those with scope 3 targets reported flat or rising scope 3 emissions.

Which means a company reporting strong progress through 2025 may have exhausted its easy reductions, and the next tranche is much harder. That's an honest story, and one we rarely see told.

The scope three problem

For many companies, value-chain emissions far exceed operational emissions, which leaves much of the reduction effort dependent on suppliers, customers and other partners. Companies disclosing to CDP in 2023 reported supply chain emissions that were, on average, 26 times their operational emissions. Only 15% had set a supply chain target.

Reducing it requires suppliers to change, which requires either commercial leverage or genuine collaboration, and in my experience most companies have less of both than their targets assumed. Measurement alone remains unreliable. For purchased goods and services, the GHG Protocol falls back on the spend-based method when supplier-specific, hybrid and average-data methods aren't feasible: multiply what you spent by an industry-average emission factor. Even Google still estimates part of its hardware supply chain that way, and its 2026 report describes replacing some of those estimates with product life-cycle data.

The communications consequence: a company can be doing serious work and still show poor numbers, and can be doing nothing and show fine numbers, depending heavily on methodology. Microsoft stopped using non-additional, unbundled renewable energy certificates in fiscal 2025, the kind of change that certificate research had called for, and said in its own report that the decision raises its reported emissions in the near term. Anyone reporting in this area without explaining their method is asking to be misread.

How are Google and Microsoft doing on their climate targets?

Google's and Microsoft's 2026 environmental reports show the gap between a 2030 climate target and current emissions in plain numbers. Google set a goal in 2021 to cut its combined scope 1, 2 and 3 emissions in half from a 2019 base by 2030. Its 2026 environmental report puts 2025 emissions, on the adjusted "ambition-based" measure it uses to track that goal, 81% above its recalculated 2019 base, driven mainly by supply chain growth, including hardware manufacturing. Microsoft said in January 2020 it would be carbon negative by 2030 and cut its scope 3 emissions by more than half. Its 2026 data shows emissions, on the measure it uses to track that goal, rising from about 12.9 million metric tons of carbon dioxide equivalent in fiscal 2020 to 20.3 million in fiscal 2025. Microsoft attributes the latest year's increase primarily to data center expansion and its decision to stop using non-additional, unbundled renewable energy certificates.

Neither company has dropped its target. Both keep their original baseline years and explain why the numbers moved, including accounting changes. That part, at least, follows the playbook below.

How should companies report progress on net zero targets?

Credible progress reporting on net zero targets rests on four habits: report against the original target, separate reduction from offsetting, show the composition, and say early when you'll miss.

Report against the original target. Restating a baseline is sometimes required: the GHG Protocol requires a recalculation when an acquisition, a divestment or a methodology change significantly shifts the numbers. What damages a company is doing it quietly, because it's discoverable and it recontextualizes everything else you've said. The Net Zero Tracker's 2026 review of the 50 largest listed companies lists moving a baseline year forward among the common ways a target gets weaker without being withdrawn, and found that a fifth of the changes that weakened or dropped a target came with no explanation at all. If the baseline moves, show the old number beside the new one and say why.

Separate reduction from offsetting. These are different activities, and the rules now treat them that way. The net zero standard of the Science Based Targets initiative (SBTi) says carbon credits can't be counted as reductions toward a science-based target. The FTC's Green Guides call it deceptive to present an offset as a reduction when the reduction was required by law, and expect offset claims to rest on competent and reliable scientific and accounting methods. EU consumer rules that apply from September 2026 ban claims that a product has a neutral, reduced or positive climate impact based on offsetting. Google, which had described its operations as carbon neutral since 2007 on the strength of purchased offsets, stopped making that claim starting in 2023.

Show the composition. Which reductions came from electricity, which from efficiency, which from structural change. It demonstrates you understand your own footprint and it sets realistic expectations for what comes next.

Say when you'll miss. A company that announces early that a 2030 target is not achievable on the current path, with reasons, retains far more credibility than one that stays silent until the deadline. The standard-setters have moved the same way: the SBTi's new Corporate Net-Zero Standard, published in June 2026, expects companies to be transparent about implementation barriers and what they're doing about them. In my experience, saying it early also makes a better story, because it's honest and rare.

If you're revising a target

Some targets were set optimistically and will not be met. That's a fact pattern many companies are in and few are handling well.

The version that works: state the original target, state the current trajectory, explain what changed, describe what the revised commitment is and why it's achievable, and take the criticism. It's a bad news cycle.

The version that doesn't: change the number on the website, hope nobody diffs it, and get discovered by a journalist, an activist group or a research team that does this professionally. The Net Zero Tracker plans to release a tool in early 2027 built specifically to make changes to company targets visible. It's a bad news cycle plus a credibility loss that attaches to everything else you publish.

The first is survivable and the second compounds.

Common questions

What are net zero targets? A corporate net zero target is a commitment to cut scope 1, 2 and 3 emissions to zero or a small residual level by a set year, often 2050, and to permanently remove and store what remains. Under version 1.3.1 of the SBTi's Corporate Net-Zero Standard, most companies' long-term targets mean cuts of at least 90%, with near-term targets generally covering five to ten years. Version 2.0 sets five-year near-term targets.

What is decarbonization? Reducing the carbon emissions associated with an organization's operations, energy use and value chain, usually measured against a stated baseline year and working toward a target date, such as an interim goal for 2030 or a net zero date.

Why are companies falling behind on climate targets? Progress has been uneven. Emissions from purchased electricity fell fastest, helped by renewable procurement and other market instruments, while direct and supply chain emissions depend on capital, process changes and suppliers. In The Conference Board's 2026 polling, 55% of executives named capital allocation, cost or return on investment as a likely reason their company might adjust or delay its targets. Among S&P 500 companies with scope 3 targets, 62% reported flat or rising scope 3 emissions between 2021 and 2025.

What is scope three and why is it difficult? Emissions from a company's value chain rather than its own operations. CDP's disclosure data puts supply chain emissions at about 26 times operational emissions on average. They sit outside direct control and are often estimated from spending and industry averages rather than measured.

How should a company communicate missing a climate target? Early, against the original target, with the reasons it changed and a revised commitment that can be defended. Silent restatement is discoverable and damages credibility across everything else the company publishes.

Do carbon credits count toward climate targets? Not under the Science Based Targets initiative's Corporate Net-Zero Standard (version 1.3.1), where carbon credits don't count toward near-term or long-term emissions reduction targets. Neutralizing residual emissions at net zero requires carbon removal and permanent storage, and credits may also finance mitigation beyond the targets. In the EU, consumer rules that apply from September 2026 ban product claims of climate neutrality based on offsetting.

Sources

• Net Zero Tracker (Energy & Climate Intelligence Unit, Data-Driven EnviroLab, NewClimate Institute, Oxford Net Zero), Net Zero Stocktake 2026, November 2026
• Matteo Tonello, The Conference Board, summarizing a report by Andrew Jones, Emission Impossible: Corporate Climate Goals Moving from Adoption to Execution, Harvard Law School Forum on Corporate Governance, July 23, 2026 (report published July 15, 2026)
• Anders Bjørn, Shannon M. Lloyd, Matthew Brander and H. Damon Matthews, Renewable energy certificates threaten the integrity of corporate science-based targets, Nature Climate Change, June 2022
• CDP, Corporates' supply chain scope 3 emissions are 26 times higher than their operational emissions, June 25, 2024
• World Resources Institute and WBCSD, Technical Guidance for Calculating Scope 3 Emissions, GHG Protocol
• World Resources Institute and WBCSD, The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard, revised edition, chapter 5
• Google, 2026 Environmental Report, June 30, 2026
• Microsoft, 2026 Environmental Sustainability Report and 2026 Environmental Data Fact Sheet, July 2026
• Dara Kerr, Google and Microsoft report growing emissions as they double-down on AI, NPR, July 12, 2024
• Science Based Targets initiative, SBTi Corporate Net-Zero Standard V1.3.1, April 2026, criterion C12
• Science Based Targets initiative, The SBTi releases Corporate Net-Zero Standard V2.0, June 11, 2026
• Federal Trade Commission, Guides for the Use of Environmental Marketing Claims, 16 CFR 260.5 (Carbon offsets)
• European Parliament and Council, Directive (EU) 2024/825 on empowering consumers for the green transition, Official Journal of the EU, March 2024
• California Health and Safety Code, Section 44475.2 (Voluntary Carbon Market Disclosures Act, AB 1305)
• Pamela T. Wu and Levi McAllister, California Voluntary Carbon Market Disclosures Act Compliance Deadline: Strategic Considerations, Morgan Lewis, December 31, 2024
• Sullivan & Cromwell, California Air Resources Board's Initial Regulation Under SB 253 and SB 261 is Effective, October 14, 2026

Salient PR works with climate technology and sustainability-focused companies on disclosure communications, target reporting and earned media.