Morgan Stanley Adjusts Emission Targets Amid Global Green Transition Challenges

Morgan Stanley has revised its emission reduction expectations for its corporate lending portfolio due to global slow progress towards a green economy. Key challenges include slow electric vehicle adoption and hurdles in the power sector, prompting a softened target of 1.5 to 1.7 degrees Celsius warming cap.

Morgan Stanley has lowered its emissions reductions expectations for its corporate lending portfolio, citing the global shift towards a greener economy as slower than anticipated. This announcement was made by the bank's chief sustainability officer, Jessica Alsford, in a report highlighting key factors hindering progress, such as a slowdown in electric vehicle sales and challenges in biofuel adoption in aviation.

The investment bank emphasized the importance of aligning with the Paris Agreement, setting new targets that aim to cap global warming between 1.5 and 1.7 degrees Celsius. This marks a more flexible goal compared to their previous aim of a flat 1.5 degrees, acknowledging the real-world challenges faced by various economic sectors.

By 2030, Morgan Stanley plans to implement emissions reduction targets across six industries, including Energy, Power, and Autos. Notably, the bank intends to measure emissions using a "physical intensity" methodology, aligning its approach with industry peers. It also plans to adjust its baseline year to 2022 to reflect recent, more accurate data.

(With inputs from agencies.)