I am wondering about the Temperature Rating Approach and if SBTi has any method for allowing a FI to have trust in their investments temperature rating?
My understanding is that the TRA method is based of the target formulations as stated in FI-C17.3. But are there any criterias that changes the temperature score based of climate reduction outcomes?
For example if a company has a climate target with high ambition that renders in a low temperature score but the yearly follow-up shows that emissions aren’t decreasing in that pace or perhaps even increasing.
In the Temperature Rating Methodology under 2.1.5 Target Progress the following formulation indicates that there are such criterias:
2.1.5. Target progress
Scores will be based on the ambition over the timeframe of the target (base year to target year),
and not just on the forward-looking portion (current year to target year). Therefore, companies
reporting some progress towards achieving their targets (as long as it is not 100% achieved) **will **
not be penalised for early action. Target must not already have already been completed i.e. a
target that has already been achieved would not be acceptable for rating.
Are there any mechanisms in place from SBTi for companies and their temperature rating based of the company´s eventual lack of progress?