Airlines all failing to lower carbon in line with climate change agreements

The TPI is a group representing 40 investors with around $13tr in assets under management. It assesses companies' preparedness for the transition to a low-carbon economy.

The airline sector makes "a significant and fast-growing contribution to climate change", the body said. It currently accounts for 2 per cent of global CO2 emissions and 12 per cent of transport-related CO2.

It found that long-term targets for all 20 of the world's largest listed airlines will fall short of the Paris Agreement goal of limiting global warming to below 2°C. None of the 20 airlines has a target that clearly specifies how it will reduce its own flight emissions after 2025.

It rated Delta, Lufthansa, United Airlines and ANA Holdings as the best performers at managing the business risks and opportunities of climate change, but said that all could do more.

"Investors have a clear message to the aviation sector: when it comes to carbon performance, they must be in it for the long haul," said Faith Ward, co-chair of the TPI on behalf of the British Environment Agency Pension Fund.

"Investors do care - it's about encouraging disclosure so we can make informed decisions," she said.

The TPI said that airlines must also consider their contribution to climate change beyond CO2. Aircraft flying at altitude create additional warming effects, including the formation of contrails and clouds. Currently, these are not incorporated in company disclosures, or in the models used to benchmark them, even though they are "likely to be significant".

More fuel-efficient planes, wider use of biofuels and ensuring that planes fly at full capacity would help to limit emissions, the TPI said.

EasyJet and Alaska Air currently have the most efficient fleets among the top 20 listed airlines, judged by their emissions per passenger kilometre flown. At the other end of that scale, ANA, Japan Airlines, Korean Air and Singapore Airlines have the highest emissions intensities, it said.

Lead author Professor Simon Dietz, of the Grantham Research Institute, said some airlines had adopted broad industry goals to cap net carbon emissions at 2020 levels or to halve net emissions by 2050 from 2005 levels.

That focus on net emissions often meant airlines could buy permits to emit carbon dioxide, rather than make cuts themselves.

"The issue is that we don't know how much they are going to reduce their own flight emissions compared to buying offsets," Dietz said.

Dietz also said there were other effects of aviation apart from carbon dioxide that need more research. Contrails, for instance, may cause high-level clouds that trap heat.

Under the 2015 Paris climate agreement, almost 200 governments agreed to cut emissions to help avert more floods, droughts and rising sea levels. They promised to "enhance public and private sector participation" in cutting emissions.