Mandatory corporate carbon disclosures and the path to net zero

CEPR Policy Insight No 111

Patrick Bolton, Marcin Kacperczyk, Christian Leuz, Gaizka Ormazabal, Stefan Reichelstein, Dirk Schoenmaker

In anticipation of COP26, this Policy Insight argues that the widespread implementation of mandatory carbon disclosures for firms can make a decisive difference in achieving net zero targets. Crucially, to succeed, mandatory carbon disclosures should be made simple, be straightforward to interpret, and be enforced with due diligence. Given the urgency of the climate crisis, information about corporate carbon emissions is becoming increasingly important. The proposals detailed in this Policy Insight could deliver much of what policymakers and asset managers need to manage carbon transition risk and accelerate the pace of future carbon emissions reductions.