Are Multinational Corporations Becoming More Sustainable?

Are Multinational Corporations Actually Becoming More Sustainable?

Multinational corporations are becoming more sustainable in what they disclose and commit to, but progress on actual emissions and supply chains is slower and uneven. The evidence points in two directions at once. On commitments, the trend is clear: as of 2025 roughly 63% of the Forbes Global 2000 had net-zero targets, more than 10,000 companies held Science Based Targets initiative (SBTi)-validated goals by January 2026, and the world's largest firms now report sustainability data almost universally. On delivery, the picture is weaker: most net-zero targets fail basic integrity tests, value-chain emissions remain largely unmanaged, and several high-profile firms have quietly diluted earlier pledges. Treating this as a simple yes or no misleads. The defensible conclusion is qualified progress — genuine in disclosure and ambition, lagging in execution and credibility, and now being pulled forward by tougher standards and regulation.

How Much Has Corporate Disclosure and Target-Setting Grown?

Corporate sustainability disclosure has moved from a minority practice to a near-universal norm among large multinationals. The KPMG Survey of Sustainability Reporting 2024, which analysed the world's 250 largest companies by revenue (the G250) alongside 5,800 firms across 58 jurisdictions, found that 96% of the G250 now report on sustainability, that 95% publish carbon-reduction targets, and that the Global Reporting Initiative (GRI) Standards remain the most-used framework at around 77% of the G250. Target-setting has scaled in parallel. The Science Based Targets initiative (SBTi) confirmed that more than 10,000 companies held validated climate targets by January 2026, with net-zero commitments specifically rising 61% during 2025. The direction of travel on commitments is unambiguous: among the largest multinational corporations, publishing a target is now the expectation rather than the exception.

What Do the Numbers on Corporate Commitments Show?

Several authoritative trackers quantify the rise in multinational corporate climate commitments, summarised below:

Are These Commitments Credible, or Greenwashing?

The credibility gap is where corporate sustainability progress is weakest. Greenwashing means presenting a misleading picture of environmental performance, and the data shows commitments routinely outrun substance. The Net Zero Tracker, run by the NewClimate Institute, Oxford Net Zero, the Energy and Climate Intelligence Unit and Data-Driven EnviroLab, found in its Net Zero Stocktake 2025 that while around 63% of the Forbes Global 2000 had net-zero targets, only about 7% of large companies met the full set of minimum procedural and substantive integrity criteria it calls the 'starting line'. Many targets rely on caveats, exclude major emission sources, or lack interim milestones. Several multinationals also walked back pledges in 2024 and 2025. Progress on headline commitments is therefore real but should not be confused with credible, deliverable plans — the two diverge sharply.

What Distinguishes Real Progress From Greenwashing?

Assessing whether a multinational corporation is genuinely improving means looking past the headline pledge to the structural signals below:

• Validated, science-based targets — goals checked against a credible decarbonisation pathway by an independent body such as the SBTi, rather than self-declared.
• Near-term milestones — interim targets (for example, by 2030) that make progress measurable now, not only a distant net-zero year.
• Scope 3 coverage — inclusion of value-chain emissions, which dominate most companies' footprints, rather than only direct operations.
• Capital and incentive alignment — executive pay and capital expenditure tied to the targets, signalling that the commitment shapes real decisions.
• Transparent, audited reporting — disclosure against recognised standards (GRI, IFRS S1/S2) with third-party assurance, rather than selective marketing claims.

Why Do Supply Chains Decide the Outcome?

Supply chains are where most corporate emissions sit and where progress is hardest, making them the decisive test of genuine sustainability. According to CDP, the global environmental-disclosure non-profit, corporate Scope 3 supply-chain emissions are on average 26 times greater than a company's direct operational (Scope 1 and 2) emissions. Yet engagement remains thin: CDP found that only about 15% of disclosing companies had set upstream Scope 3 targets, fewer than 6% required suppliers to disclose climate data, and only around 13% included climate requirements in supplier contracts. A multinational can decarbonise its offices and fleet while leaving the bulk of its footprint — embedded in purchased goods, materials, and logistics — untouched. Until value-chain emissions are measured, targeted, and contractually managed, headline corporate commitments capture only a fraction of the problem they claim to solve.

How Is Regulation Forcing the Pace?

Regulation and tightening voluntary standards are converting corporate sustainability from optional storytelling into audited obligation. The European Union's Corporate Sustainability Reporting Directive (CSRD) introduced mandatory double-materiality reporting, and the 2025 Omnibus simplification package — agreed by the Council and Parliament in December 2025 — refocused its scope on companies with more than 1,000 employees and over EUR 450 million in turnover, applying to financial years beginning on or after 1 January 2027. Globally, the International Sustainability Standards Board (ISSB) issued IFRS S1 and IFRS S2, which absorbed the Task Force on Climate-related Financial Disclosures (TCFD) after it was disbanded in October 2023, creating an investor-facing baseline now being adopted across jurisdictions. The combined effect is structural: large multinationals increasingly must report comparable, assured sustainability data, raising the cost of vague or unsubstantiated claims.

What Changes Under the SBTi Corporate Net-Zero Standard v2.0?

The voluntary side is tightening too. The Science Based Targets initiative published Version 2.0 of its Corporate Net-Zero Standard on 11 June 2026, following draft consultations during 2025, with the new rules taking effect from 1 February 2027 and validation under v2.0 beginning in 2027. Version 2.0 sharpens several weak points that critics had flagged in earlier corporate pledges:

1. Stronger Scope 3 expectations, pushing companies to address the value-chain emissions that dominate most footprints.
2. Clearer treatment of carbon credits and removals, including a phased requirement for large companies to use carbon removals for residual emissions from 2035.
3. More rigorous, regularly reviewed targets so that headline net-zero claims must be backed by a verifiable pathway rather than a distant aspiration.

What Role Does Sustainable Finance Play?

Capital markets are reinforcing corporate sustainability by pricing environmental, social, and governance (ESG) risk into the cost of money. The Global Sustainable Investment Alliance (GSIA) counted USD 16.7 trillion in fund assets using responsible-investment approaches in its Global Sustainable Investment Review 2024. Institutional investors — pension funds, asset managers, and sovereign wealth funds — increasingly treat weak climate plans as a financial risk, while credible decarbonisation can lower the cost of capital. The pressure is imperfect: enforcement of green claims softened when the European Commission announced its intention to withdraw the proposed EU Green Claims Directive in June 2025, and some investors have scaled back ESG branding amid political backlash. Even so, the underlying mechanism endures: as disclosure becomes mandatory and comparable, capital can distinguish substantive performers from those relying on narrative, steering financing toward the former.

So, Are Multinationals Becoming More Sustainable?

On balance, multinational corporations are becoming more sustainable, but the progress is genuine, partial, and contested rather than complete. Disclosure is now near-universal among the largest firms, science-based targets have passed 10,000 companies, and mandatory reporting plus tougher standards are closing the room for empty claims. At the same time, most net-zero targets still fail basic integrity tests, supply-chain emissions remain largely unmanaged, and several firms have retreated from earlier pledges. The trajectory is positive but the pace is insufficient for the climate timelines set by the Paris Agreement. The decisive factors over the next decade will be execution against interim targets, supply-chain decarbonisation, and the credibility infrastructure — verification, assurance, regulation — that separates measurable performance from marketing. Progress is real; complacency would be misplaced.

How Can You Help Lead Corporate Sustainability With SUMAS?

Closing the gap between corporate commitments and credible delivery is precisely the work that sustainability professionals do — and the skill set is among the most in-demand in global business. Leading corporate sustainability means understanding emissions accounting, science-based targets, supply-chain due diligence, disclosure standards such as IFRS S1/S2 and the CSRD, and the financial logic that connects them. SUMAS, the Sustainability Management School based in Switzerland and taught entirely in English by industry practitioners, develops exactly this capability across its on-campus and fully online degrees. The Bachelor (BBA) and Master programmes build the reporting, strategy, and decarbonisation fluency that employers increasingly require, while the MBA in Sustainability Management equips experienced professionals to lead corporate transformation. If you want to turn the corporate sustainability transition into a career, the related SUMAS programmes below are the natural starting points.