Starting in January 2026, publicly listed Brazilian companies will be required to disclose their greenhouse gas emissions. This follows similar actions taken around the world—from Australia to New Zealand and the European Union. What will we learn from these disclosures? This year, EPIC created the Climate Disclosure Explorer to unpack the societal cost of greenhouse gas emissions coming from corporate activities, known as corporate carbon damages. It plots the corporate carbon damages for roughly 15,000 publicly-traded firms, accounting for more than 80 percent of global market capitalization.
The platform is based on a study published in Science by Booth School of Business professor Christian Leuz, EPIC director Michael Greenstone and their colleague Patricia Breuer. The study found average corporate carbon damages are large, equaling about 44 percent of firms’ operating profits. Four sectors account for 89 percent of those damages—utilities, materials, energy and industrials. But the Climate Disclosure Explorer shows that damages vary significantly within each sector, with a small number of high-emitting firms driving up the average costs. The same is true for sub-industries within sectors.
If all high emitters reduced their emissions to meet the sub-industry median damages, the researchers estimate that it would reduce total emissions by 49 percent. The Climate Disclosure Explorer allows users to adjust the damages of outlying firms and learn the impact on emissions by moving the outliers closer to the sub-industry median (sub-industry based on 8-digit GICS classification).