The Climate Action Tracker (CAT) is an online tool developed by Climate Analytics and the NewClimate Institute. It provides an independent scientific analysis that tracks government climate actions against the Paris Agreement’s goal of limiting global warming to well below 2°C, ideally 1.5°C. The tool is designed for policymakers, climate advocates, researchers, and finance professionals who need reliable data to assess the progress of climate actions worldwide.

CAT covers 39 countries, representing about 85% of global emissions, and provides an assessment of their national climate targets and policies. The tool evaluates the ambition and effectiveness of these targets by comparing them with the actions required to meet the Paris Agreement goals. The assessments are presented in a straightforward manner, with ratings ranging from “critically insufficient” to “1.5°C Paris Agreement compatible.”

For finance professionals, CAT is particularly valuable as it offers insights into the climate-related risks and opportunities associated with various countries and their policy trajectories. By analysing the climate commitments and actions of different nations, finance professionals can better understand the potential impacts on investments, particularly in sectors vulnerable to climate policy changes. The tool helps in identifying regions where stronger climate actions may present opportunities for green investments, as well as regions where insufficient action could pose risks.

The tool is also useful for evaluating the alignment of corporate investments with global climate goals. As finance professionals increasingly incorporate environmental, social, and governance (ESG) factors into their decision-making processes, CAT provides the necessary data to ensure that investment portfolios are aligned with the transition to a low-carbon economy. By using CAT, finance professionals can stay informed about the latest developments in climate policy and adjust their strategies accordingly.

In summary, the Climate Action Tracker is a critical resource for finance professionals who require accurate, up-to-date information on the progress of national climate actions. The tool helps users assess climate risks, identify investment opportunities, and align portfolios with global climate goals. With its clear, structured assessments, CAT enables finance professionals to make informed decisions that support sustainable finance and the transition to a low-carbon economy.