Six, the financial group that runs the Swiss stock exchange, has introduced the ‘Six 1.5°C Climate Equity’ flag, a tool designed to help investors identify companies committed to aligning their business models with the Paris Agreement’s objective of limiting global warming to 1.5°C above pre-industrial levels.
The new flag is available to companies listed on the SIX Swiss Exchange, which can apply for it. To be awarded the flag, a company must present a confirmation from an approved reviewer certifying that it meets all the necessary criteria. Currently, two organizations, S&P and SGS, are authorised to provide this review. The flag is valid for one year, requiring companies to renew it annually with updated confirmation to maintain their status.
To qualify for the flag, companies must undergo an assessment process consisting of three key evaluations. First, a top-down analysis ensures that the company’s entire value chain is aligned with the 1.5°C target by examining its future emissions reduction and removal strategies. Secondly, a bottom-up evaluation assesses the credibility of the company’s ability to meet these targets over time. Lastly, an activity-level assessment determines whether more than 50% of the company’s current revenues and investments actively contribute towards the 1.5°C goal.
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The criteria for obtaining the flag are grounded in established sustainability principles and align with the scientific consensus on climate change, particularly the findings of the Intergovernmental Panel on Climate Change (IPCC). The framework incorporates widely recognised methodologies and standards, such as the Carbon Disclosure Project Assessing Low-Carbon Transition initiative, the Climate Bonds Initiative, the UN Race to Zero Starting Line Criteria, and the WFE Green Equity Principles (2023).
Bjørn Sibbern, global head exchanges, executive board member, Six, said: “Our new flag serves as a tool to enhance the visibility and reputation of companies. This in turn supports investors in making more informed decisions, reducing uncertainty around a company’s current and future climate emissions trajectory. We developed the concept for the flag following extensive exchange with listed companies, audit and legal firms, sustainability experts as well as industry associations and it represents a further step in our sustainability strategy.”
