The DAX companies will have emitted fewer greenhouse gases in 2023. At least that is what an analysis of their sustainability reports shows.
According to a recent analysis, the German stock market heavyweights reduced their greenhouse gas emissions last year. Compared to 2022, the direct emissions of the DAX companies fell from 218 to 189 million tons of CO2 equivalents – a decrease of around 14 percent. This is the result of the analysis for which the auditing and consulting firm EY evaluated the sustainability reports of the 40 companies. In these, they document their efforts towards climate neutrality.
Decrease of almost 30 million tonnes
In absolute terms, the loss of the DAX companies amounts to almost 30 million tonnes of CO2 equivalents. According to EY figures, this corresponds to the annual emissions of 17.4 million average new cars with a mileage of 15,000 kilometres.
A total of 32 DAX companies reduced their emissions. Seven emitted more greenhouse gases than in 2022. One company did not provide any information. The largest percentage decrease was recorded by the chip manufacturer Infineon and the insurer Allianz, the largest increase by the sports car manufacturer Porsche AG. The largest emitter in 2023 was the building materials group Heidelberg Materials, followed by the energy company RWE and the chemical group BASF.
According to the analysis, these figures include emissions that arise from processes during ongoing operations – including from machines, the company’s own power plants or the company’s vehicle fleet. However, they also include greenhouse gases that are emitted during the production of purchased energy. This is the case, for example, when a company purchases electricity or district heating from a supplier with fossil-fuel power plants.
Expert warns against complacency
The head of EY sustainability consulting, Simon Fahrenholz, says that the German economy is making good progress in reducing emissions. Top companies in particular are playing a pioneering role in this.
Fahrenholz, however, did not expect the development to continue at the current pace. Many companies have so far relied on individual measures, such as switching to electricity from renewable energy sources. This is relatively easy to implement and has a strong effect. However, it only takes effect once. This is also shown by the fact that the energy consumption of DAX companies has fallen significantly less than emissions.
Despite the positive development, Fahrenholz warned against complacency: “The further reduction of the carbon footprint will not be a sure-fire success.” On the contrary: Many companies are currently under pressure due to bleak business prospects, among other things. “The sustainable restructuring of the business model threatens to become one of many construction sites and receive too little attention.” In order to be able to cope with the mammoth task, decarbonization needs to be integrated holistically into the corporate strategy.
Indirect emissions are many times higher
The analysis also looks at another category of emissions: those that cannot be directly attributed to corporations because they arise at upstream and downstream value creation stages. These include, for example, the supply chain, transport, use of products or disposal. If these are included, the DAX companies account for emissions of almost 3.5 billion tons – or nine percent of global greenhouse gas emissions last year. The decrease compared to 2022 is therefore reduced to four percent.
According to Fahrenholz, companies’ options for gaining an overview of indirect emissions are limited: holistic efforts are needed to create more transparency and reduce these emissions. For example, companies would have to negotiate with suppliers and waste disposal companies. But changes in product development are also necessary. “This takes time, and successes sometimes only become apparent after a delay of several years.”
Source: Stern
