Voluntary Corporate Climate Targets in a Patchwork Policy Landscape

Many large, publicly-traded companies adopt voluntary greenhouse gas emission reduction commitments in the presence of a fragmented public policy landscape. To explore the potential emission implications of such commitments, we develop a framework for understanding how firms’ voluntary emission targets interact with carbon pricing, regulatory mandates, subsidies, and heterogeneous policies across political jurisdictions. This analysis highlights the difficulty of distinguishing incremental voluntary emission abatement from policy-induced emission reductions. We introduce the Salata Institute Corporate Climate Targets Database, which we produced from public domain reports published by Russell 3000 firms over 2000-2024. The database documents the growth, form, scope, and sectoral distribution of voluntary greenhouse gas emission targets, including net-zero, carbon-neutral, carbon-reduction, energy-related, and qualitative commitments. Comparing this database with CDP, a non-profit organization formerly known as the Carbon Disclosure Project and the most common source of corporate emission targets used in the research literature, reveals substantial omissions in their survey-based data, especially in recent years. We show that voluntary corporate targets often mirror government-established goals and public policies, and some firms benchmark their internal carbon prices to existing carbon taxes and emission trading systems. The paper concludes by outlining empirical challenges and future research needs for evaluating the emission impacts of voluntary commitments.