The selection process started with 432 stocks rated as outperform at BMO, evaluating them against criteria such as net-zero emissions policies, transparency in carbon emissions, and board oversight of climate targets.
Ninety-nine companies that demonstrated a successful reduction in greenhouse gas emissions over the past three years and had a robust policy for further reductions by 2030 were then scrutinized. The stocks that progressed had carbon emissions in the lowest quartile compared to their peers.
This list was refined to 47 stocks before entering the third stage, which used Bloomberg’s physical climate risk rating scale. This scale considers not just emissions but also the impact of operations on soil, energy use, supplier emissions compliance, and waste and water management.
The fourth and final stage assessed the remaining 35 companies for their potential earnings growth from global decarbonization efforts, leading to a final selection of 26 companies.
These include leaders in critical materials for renewable power, smart grid expertise, energy transition finance, and sustainable packaging development.
