Transition Pathway Initiative (TPI) is a global, asset‑owner‑led organisation, supported by asset managers and academic and data partners. Founded in January 2017, its mission is to assess how companies—and increasingly banks, sovereigns and bond issuers—are prepared for the transition to a low‑carbon economy.
TPI has two core focuses. First, it evaluates Management Quality, examining how effectively companies govern greenhouse gas emissions and manage transition‑related risks and opportunities. This is done via a structured framework of indicators mapped to tiers or levels. Second, it assesses Carbon Performance, comparing companies’ emissions trajectories with international climate targets—such as those under the Paris Agreement—using sector‑specific benchmarks partly derived from International Energy Agency scenarios.
TPI’s structure includes the TPI Centre, based at the Grantham Research Institute at the London School of Economics (LSE), which develops methodologies, conducts assessments and hosts TPI’s open‑access online tool. Data support is provided by FTSE Russell (an LSEG company), while investor governance involves a network of asset owners and managers with significant Assets Under Management and Advice—recent figures include around US$60 trillion as of late 2023.
TPI contributes to sustainable finance by offering transparent, academically robust data and tools that investors can use for engagement, proxy voting, investment research and sustainable decision‑making. Its datasets cover equities, corporate bond issuers, banks, and sovereign issuers, and are used by collaborations such as Climate Action 100+ and for benchmarking transition progress in high‑impact sectors.
In summary, TPI provides investors with standardised, public-domain assessments of corporate and institutional readiness for climate transition. Its methodology and online platform support sustainable finance by enabling informed capital allocation and corporate accountability across sectors.
