Game Industry Net Zero Snapshot 2022
This year AfterClimate is releasing the first of what we hope to make an annual series: a snapshot of progress towards setting and achieving net zero targets in the games industry.
In the 2022 snapshot, we outline the key findings of a comprehensive analysis of the 30 of the biggest game developers and publishers, their net zero targets, Environment, Social & Governance or ESG disclosures, and other sustainability programs and achievements. The snapshot paints a picture of growing momentum towards achieving a carbon neutral game industry, as well as the substantial gaps that remain.
The snapshot also names and shames some of the worst performers, and shouts out the industry leaders forging ahead for a better future.
In 2022 the world saw a continuation of the trend of above-average temperatures and increasing rates of extreme weather events, underscoring the urgency of achieving net zero. The safest trajectory for the planet is one in which deep emissions cuts are made as fast as possible. In any scenario where we keep warming to under 1.5ºC there is a part to be played by everyone.
At the bottom of this page we link to the full spreadsheet containing all the research, quoted excerpts, and links to all the documents used to produce this snapshot, so others can verify and compare against our findings.
For further questions either about the 2022 snapshot or to find out more about what your game company could be doing to line up with net zero targets, please fill out our contact form via the link below.
Snapshot Overview
- 30+ global companies and subsidiaries
- Drawing on self-reported ESG & sustainability disclosures for calendar year 2021
- Four major groupings of companies emerge: ambitious, baseline, catch-up, and non-compliance
- 19 out of 33 companies set net zero targets
- Over $17bn worth of game industry revenue committed to net zero (rising to $548bn of games & tech industry revenue)
- 13 TCFD materiality risk analysis style disclosures
- 10 companies applying SASB sustinability accounting standards
- 9 companies applying GRI disclosure standards
- 4 companies made validated Science Based Target initiative submissions
- 6 companies linking director compensation to ESG metrics
The snapshot focuses on some of the biggest names in the games industry
The study examined the self-reported ESG metrics and net zero commitments of the following publicly traded companies and subsidiaries:
- Microsoft
- Sony
- Tencent
- Apple
- Ubisoft
- Supercell
- 37 Interactive
- Electronic Arts
- Square Enix
- NCSoft
- SEGA
- Nintendo
- Activision Blizzard
- Bandai Namco Entertainment
- Take-Two Interactive
- CyberAgent
- Roblox Corporation
- Playrix
- Mixi
- SEA Ltd
- Keywords Studios
- NetEase
- Embracer Group
- Warner Bros Discovery
- Konami
- NetMarble
- Perfect World
- Riot Games
- King
- Zynga
- Nexon
- Playtika
- Aristocrat Leisure
The ambitious group have net zero targets of 2030 or sooner
- Supercell (2022)
- 37 Interactive (2025)
- Ubisoft
- Microsoft
- Apple
- Embracer Group
- Tencent
- Perfect World
- Riot Games
Each of these companies (or their parent) have set strong targets, and present compelling evidence of having taken steps to actively reduce emissions. There is still much work to be done to achieve these targets, but they are moving in the right direction.
These industry leaders are setting the pace, and showing what sort of ambition and action is possible in the games industry.
The baseline group have set adequate targets for 2050
- Sony (2040)
- Activision Blizzard
- King
- Bandai Namco Entertainment
- Konami
- Keywords Studios
- SEGA
This group of companies are already taking action, however without the same speed and urgency as those in the ambitious group. This is the minimum acceptable standard, and can still be improved upon.
The catch-up group are aware of the need to act but have yet to set targets
- Nintendo
- Take-Two Interactive
- Zynga
- Electronic Arts
- NCSoft
- CyberAgent
- NetMarble
- Sea Ltd
- NetEase
- Aristocrat Leisure
These companies are increasingly aware of their environmental footprint, with some even taking tentative steps to reduce it, but have yet to set a date for corporate net zero emissions.
With decisive leadership and careful planning, these companies could quickly leap-frog the baseline and join the ambitious group.
The non-compliance group currently treat ESG as a box-ticking exercise
- Square Enix
- Roblox Corporation
- Nexon
- Playtika
- Playrix
- Mixi
These are the under-performers of the games industry. These business are exposing themselves to significant risk (physical and transition risk) from climate impacts as well as threatening their brand integrity and social license to operate in an increasingly environmentally conscious world.
Dissapointingly, some of these companies appear not to have considered the environmental impact of their operations at all. There is simply no excuse in 2022 for neglecting ESG disclosures. Stakeholders, investors, and even players themselves are already beginning to expect more than this.
Neither revenue or scale needs to be a barrier to ambitious targets
In the chart below, the comparison of the ambitious and baseline companies (excluding the 5 tech majors) shows that no matter the revenue (bubble size) or the scale and complexity of operations (employee count) needs to be a barrier to strong climate targets.
The Tech Majors
Proving that size is no obstacle to ambition, these five major tech companies – each with a different presence in the games industry – all possess near-term net zero targets and are taking real steps to reduce both direct and indirect emissions.
Tencent
Apple
Microsoft
Sony
- Net zero by 2030
- CDP submission rated D
- No SBTi submission
- No data on exec remuneration linked to ESG
- P4PA member (Tencent TiMi)
- Net zero by 2030
- CDP submission rated A
- Validated SBTi submission
- No data on exec remuneration linked to ESG
- Not a P4PA member
- Net zero by 2030
- CDP submission rated A–
- No SBTi submission
- No data on exec remuneration linked to ESG
- Not a P4PA member
- Net zero by 2030
- CDP submission rated A
- Validated SBTi submission
- Executive remuneration tied to ESG
- P4PA member
- Net zero by 2040
- CDP submission rated A
- Validated SBTi submission
- Executive remuneration tied to ESG
- P4PA member
Below: the largest game & tech companies by employees (X-axis), date of net zero target (Y-axis), and Q1 2021 revenue (bubble size) as reported by Newzoo.
The powerful potential of supplier engagement
The snapshot reveals a trend, as seen in many large corporations, towards the use of codes of conduct for supply change engagement. These are expectations that a company sets for anyone doing business with them or supplying them goods. Increasingly these codes include requests to disclose greenhouse gas emissions and other ESG and greenhouse gas metrics. Some game companies are already preferring suppliers who take an active interest in reducing their footprint.
Supplier spotlight: Microsoft, Sony & Nintendo
These three companies set the standard for a huge amount of the games industry – and their codes of conduct for companies doing business with them increasingly include ESG expectations.
Microsoft
"In July 2020, Microsoft added additional sustainability requirements to its Supplier Code of Conduct to support the company’s bold carbon ambitions. This new language requires suppliers to disclose their own carbon footprints and develop plans to reduce them."
Sony
"For GHG emissions, Sony requests [suppliers and subcontractors] to monitor emission levels, set medium- and long-term targets for emissions reduction and perform progress management."
Nintendo
"...we ask our suppliers to build and operate an environmental management system, reduce greenhouse gas emissions and measure the amount of reduction, make disclosures regarding their environmental conservation efforts, and comply with green procurement requirements."
While evidence of the impact of these kind of supply chain 'codes of conduct' is limited so far, the ambitious nature of many corporate targets are likely to lead to an increasing focus on supply chains, and increasing pressure on suppliers to comply. This includes game developers, who may need to decarbonize swiftly in the coming years or risk finding themselves losing out to competitors who will.
Who is missing from the snapshot?
Notable omissions from the Snapshot are two of the industry's major players: Epic games and Valve Software neither of which currently disclose environmental data.
Epic Games' founder Tim Sweeny's conservation work has been rightly celebrated. We hope to one day be able to celebrate the same effort spent addressing the environmental impact of the company he leads.
Valve Software are one of the most important companies in PC gaming, operating the world's largest digital distribution platform Steam. PC gaming is one of the most resource intensive forms of gaming, and Valve are uniquely positioned to help or hinder the transition to a net zero game industry. Currently there is no indication of any action on net zero from valve.
Key Takeaways & Limitations
- The games industry can and must decarbonize rapidly. The snapshot shows promising signs of movement in the right direction, with strong leadership in some quarters, even as progress is incomplete, uneven, and lacking entirely in others.
- A majority of the games industry (19 out of 33 companies considered here) have set net zero targets, and many seem likely to follow in the years ahead. The larger the company the more likely they are to have already set a target. As companies grow or are acquired by existing companies with net zero targets, it is reasonable to expect coverage will grow.
- Game developers who work with, or intend to publish on platforms owned by Sony, Microsoft and Nintendo should consider urgently adopting a net zero target or face potential competitive disadvantages.
- Lastly, as a growing number are showing, it is possible to rapidly decarbonise – though often still by relying on "offsets" or "carbon credits" which must be used extremely judiciously, and as a last resort.
The snapshot presented here is not a comprehensive picture of all that is being done to decarbonise the games industry. It is also, by virtue of the slow process of ESG disclosures, already out-of-date. The snapshot relies on self-reported data published in 2022 regarding action taken in 2021. It is our sincere hope that the state of the industry is already far further along the path to net zero than this initial snapshot makes out. When we repeat the snapshot in 2023, it is likely we will see that more concrete action had already been taken than was visible from the disclosures considered here.
If you want to dig into the full data we collected for the 2022 game industry net zero snapshot, use this link to view the online spreadsheet. For questions, media inquiries and other feedback, please use the contact form on this website.
To receive future updates and about the snapshot, as well as additional insights from AfterClimate's research and advocacy, subscribe to our newsletter: 'Greening the Games Industry' by clicking the button below.
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