The first article on this issue (Part 1) focused on INFO 271[1] to develop archetypal cases that the Australian Securities and Investments Commission (ASIC) might pursue. Part 2 focused on cases that might arise outside of INFO 271, such as portfolio management practices and controls, inflated returns, and proxies. This article (Part 3, the last in this area) will focus on greenwashing cases that might arise from the “target market determination” (TMD) under the design and distribution obligations (the DDO) in Part 7.8A of the Corporations Act 2001 (Cth), product disclosure statements (the PDS) and prospectuses.
Greenwashing claims in relation to financial products will likely be pursued under provisions such as sections 769C, 1041E, 1041F, 1041H and 1041I of the Corporations Act and sections 12BB, 12DA, 12DB, 12DC, 12DF and 12DG of the Australian Securities and Investments Commission Act 2001 (Cth) (collectively, the Statutory Provisions). However, other provisions might also be engaged where a misleading or deceptive sustainability-related statement is made in a TMD (ss.994M to s.994Q of the Corporations Act), a PDS or prospectus (ss.728 and 729 of the Corporations Act). These additional risks are discussed below.
DDO
The DDO was introduced as a consumer protection measure because it was recognised that:
- “poor design and distribution practices played a significant role in contributing to consumer detriment”; [2] and
- “disclosure, financial advice and financial literacy”[3] could not always protect retail investors from a poorly designed and distributed financial product.
To address these issues, the DDO imposes obligations on Issuers[4] and Distributors[5]:
- of financial products[6] that require a disclosure document (such as a PDS)[7];
- engaged in, what the Corporations Act calls, retail product distribution conduct[8] (i.e. issuing a financial product, giving a disclosure document (such as a PDS) or providing financial product advice) directed to retail clients/consumers[9] in relation to “primary or initial offerings of financial products” and some sales on secondary markets.[10] The DDO does not apply to personal advice;[11]
- across the design, distribution, monitoring and review stages[12] of the financial product.
Under the DDO, the Issuer must make a “target market determination” (TMD) for the financial product[13] before the financial product is distributed[14]. The TMD must be in writing[15] and must satisfy the “content requirements” [16] and the “appropriateness requirements” [17].
Under the “content requirements”[18], the TMD must include (amongst other information):
- a description of the class of retail consumers that comprises the target market[19] by reference to the likely objectives, financial situation and needs of the class.[20] This might include:
- the class's “understanding of product features and capacity to meet financial obligations or bear losses;” and
- whether the class's investment needs are the same as those the product seeks to meet;” [21]
- a description of the key features of the financial product.[22] This might include:
- the product’s “complexity, risk profile (over the lifetime of the product) and applicable fees;” and
- “the investment needs that the product is seeking to meet.” [23]
Under the objective[24] appropriateness requirements [25] the TMD must include sufficient information to reasonably conclude[26] that if the financial product was issued or sold to a retail consumer:
- under the distribution conditions, it would be likely that the consumer is in the target market;[27] and
- in the target market, it would likely be consistent with the likely objectives, financial situation and needs of the class of consumer.[28] The TMD is not personal advice and so there is no requirement for the Issuer to assess the suitability of the financial product to the personal circumstances of individual consumers. [29]
Breach of the DDO can give rise to a civil penalty,[30] criminal prosecution,[31] and civil liability[32] (the Civil Liability Provisions). The Civil Liability Provisions provide a client with a statutory remedy to recovery any loss and damage suffered because of a contravention of the content requirements and the appropriateness requirements (amongst others). In establishing this claim, contravention and resulting damage need be proven. Greenwashing (i.e., misleading and deceptive conduct) need not be proven. And so, the Civil Liability Provisions might be a simpler remedial pathway for retail consumers who have suffered loss by a contravention of the DDO.
The Civil Liability Provisions do not affect any liability that the Issuer or Distributor may have under any other law.[33] Therefore, a greenwashing claim under the Statutory Provisions is not excluded. Further, Issuers’ disclosures in the TMD in relation to (for example) the sustainability related attributes of a financial product and the class’s objectives could provide probative evidence in proving greenwashing[34] under the Statutory Provisions. The availability of this evidence could encourage “greenwashing” claims arising out of the TMD.
Given the recency of the DDO, unsurprisingly, the provisions have not been tested nor been publicly applied with regard to sustainability related issues. So this raises the question, what greenwashing cases might arise from a contravention of the DDO?
The class of retail consumers that comprise the target market is usually described in the TMD in both a table and a summary paragraph. The table lists out consumer attributes (such as investment objectives, intended product use, investment timeframe, risk and need to withdraw money) against which the financial product’s attributes are matched. The summary paragraph might describe the table (i.e., the target market) as follows: a retail investor with a high risk return profile that is seeking income growth and/or income distribution over a long term investment timeframe from an investment that incorporates ESG risks and which can vary from a small allocation to standalone.
Advertising and promotional material for financial products must describe the target market or specify where the TMD is available.[35] Additionally, TMDs must be made available to the public free of charge.[36] This means sustainability related statements in the TMD on the key attributes of the financial product could be relied upon by retail investors to make investment decisions and this exposes those statements to scrutiny under the Statutory Provisions (i.e. misleading or deceptive conduct). This exposure must be considered in the context of the PDS, which should have been provided to the consumer.
Taking the summary paragraph, it is apparent that:
- the words “incorporates ESG risks” do not inform the potential retail investor:
- what specific elements of “E”, “S” or “G” were incorporated; or
- whether each of “E”, “S” and “G” are key attributes of the financial product;
- no description of the ESG objectives and needs of the class of consumers in the target market is articulated; and
- it is expressed in broad rather than specific terms. ASIC’s guidance is that a description in general terms such as “seeking sustainable-related investments” might not be sufficient because ASIC considers that “a broad consumer objective or preference alone is unlikely to be sufficient to define the target market for a financial product.”[37]
The misalignment of sustainability related features of the financial products and the likely objectives and needs of the target market could indicate a greenwashing risk. For example, if the financial product focuses on a singular component of “E” or several components of “E” but not “S” or “G”, and the class of consumers in the target market are seeking different components of “E” and “S” generally, this misalignment could amount to greenwashing.
Finally, an issue for further consideration. The DDO is designed to ensure that the financial product is distributed to retail consumers within the target market. But this may not always be the result. This is recognised under the Corporations Act by:
- the obligation on Issuers and Distributors to report to ASIC significant distribution outside the target market;[38]
- Issuers and Distributors not been held to have contravened their reasonable steps obligation in relation to distributing the financial product where a retail client outside the target market acquires the financial product.[39]
This raises an interesting question, how might any sustainability related misrepresentation in a TMD operate in establishing misleading or deceptive conduct if the retail consumer who relied upon the misrepresentation falls outside the class of consumers in the target market?
PDS
Broadly, a PDS must be given whenever a regulated person[40] issues,[41] sells[42] and recommends[43] a financial product to a retail client.
Div 2 of Pt 7.9 of the Corporations Act lists out specific information which must be disclosed in a PDS. In relation to products with an investment component[44] this includes the disclosure of “… any claim that labour standards or environmental, social or ethical considerations are taken into account in the selection, retention or realisation of the investment”[45] (even if a product does not promote or market itself as taking them into account[46]).
The “environmental, social or ethical” concept is similar but not identical to the ESG concept. The ‘G” in the ESG concept is a reference to “governance” of which “ethical” (the term used in relation to PDSs) may be a subset.
Regulatory Guide 65 (Section 1013DA disclosure guidelines) (RG 65) contains ASIC’s guidance on the information that must be disclosed in a PDS in relation to the “environmental, social or ethical considerations”. However, RG 65 does not define what constitutes “environmental, social or ethical considerations” or “what methodology…should be used for taking these issues into account”.[47] Rather RG 65 establishes minimum standards about the “what”, “how” and “methodology” of the “environmental, social or ethical considerations”. This can be explained further by adopting the language of RG 65. At a minimum, a retail client should be given general information about:[48]
- what issues the product issuer takes into account;
- how these issues are taken into account; and
- whether or not its approach is based on some predetermined methodology.
Besides adopting the guidance in RG 65 in relation to disclosing environmental, social or ethical considerations, there must be compliance with Part 7.9 of the Corporations Act and the requirement to:
- “word and present” the information in “a clear, concise and effective manner;”[49]
- include information that a person would reasonably require for the purpose of making a decision, as a retail client, whether to acquire the financial product, including:
- information about any significant risks associated with holding the product;[50]
- information about any other significant characteristics or features of the product;[51]
- “contain any other information that might reasonably be expected to have a material influence on the decision of a reasonable person, as a retail client, whether to acquire the product.” [52]
The words “information” and “retail client” in the PDS requirements (summarised above) have been underlined because these terms may now be coloured by the DDO, such that a reference to:
- “retail clients” when read with the DDO may no longer be a reference to a generic class of retail clients but to the target market identified in the TMD. That is, a specific "class of retail client[s] that comprise the target market that possesses the likely objectives, financial situation and needs of the class;”[53]
- “information” when read with the DDO might include a description of:
- the short and long term[54] “likely objectives, financial situation and needs” of the consumer in the target market; and
- the product, including its key attributes. This is likely picked up by the requirement under s.1013D(1)(f) of the Corporations Act to disclose information about any other significant characteristics or features of the product. However, the DDO may add a gloss such that the key attributes to be disclosed are those “product terms, features and attributes that affect whether the product is likely to be consistent with the likely objectives, financial situation and needs of consumers in the target market.”[55]
A greenwashing risk might arise where (for example) the PDS fails to include sustainability related information or misrepresents that information, in circumstances where a retail client in the target market would reasonably:
- require that information for the purposes of making a decision whether to acquire that sustainability related financial product;
- be expected to have a material influence on the decision of a retail client whether to acquire the financial product.
Supplementary PDSs[56] to correct misleading or deceptive statements and ASIC’s use of stop orders[57] are other potential responses to misleading or deceptive statements in PDS.
Further greenwashing risks might arise as follows.
Firstly, ASIC’s INFO 271 (How to avoid greenwashing when offering or promoting sustainability-related products) might also provide some insight into the greenwashing claims ASIC may pursue in relation to PDSs. Those potential claims were discussed in Part 1 of this series, which covered potential claims such as labelling and terminology, screening criteria, headline claims, incorporation of sustainability related factors, index, and metrics.
Second, and separate to the Statutory Provisions, the misleading or deceptive conduct provisions in Chapter 6D of the Corporations Act (the Chapter 6D Misleading Provisions) may also provide an avenue to regulate greenwashing. These provisions have the added complication of:
- establishing whether the misleading or deceptive statement is “materially adverse from the point of view of an investor;”[58] and
- the availability of statutory defences. [59]
Where a contravention of the Chapter 6D Misleading Provisions is established, damages are available to persons who have suffered loss or damage because there is a misleading statement in the PDS.
Third, where the overall impression given about the extent to which the environmental, social or ethical considerations are taken into account in the selection, retention or realisation of an investment, ASIC’s guidance is that it may take enforcement action.[60]
PROSPECTUS
An offeror must prepare a prospectus[61] with most offers for sale or issue[62] of securities[63] which need disclosure to investors under Pt 6D.2 of the Corporations Act[64]. The purpose of a prospectus “is to help retail investors assess the risks and returns associated with an offer and make informed investment decisions.”[65]
The Corporations Act seeks to ensure this purpose is met by requiring that (amongst other requirements):
- the wording and presentation of information is in a clear, concise and effective manner.[66] This is a “compound phrase so each word qualifies the other;”[67]
- the disclosure of information consistent with the general disclosure test (i.e., all the information that investors and their professional advisers would reasonably require to make an informed assessment);[68] and
- disclosure that is not misleading or deceptive [69] (i.e., the Chapter 6D Misleading Provisions).
As discussed above, the Chapter 6D Misleading Provisions provide a further statutory avenue to regulate greenwashing.
Risks must be disclosed in the prospectus. ASIC’s guidance is that “Climate Change” and “Environmental risks” are common risks that may affect the issuer or the security. ASIC defines these terms:
- “Climate change”: [70]
Transitioning to a lower-carbon economy may entail extensive policy, legal, technology and market changes to address mitigation and adaption requirements related to climate change. Depending on the nature, speed and focus of these changes, transition risks may pose varying levels of financial and reputational risk to companies (transitional risks of climate change).
Physical risks resulting from climate change can be event driven (acute) or longer term shifts (chronic) in climate patterns. Physical risks may have financial implications for companies, such as direct damage to assets and indirect impacts from supply chain disruption.
- “Environmental risk”: [71]
Being unable to pursue a project due to specific environmental concerns, regulations or requirements, or costs associated with environmental rehabilitation.
ASIC’s guidance is these risks should be disclosed if they:
- have a reasonable likelihood of occurring[72] and would have a very significant effect on the company’s financial position and the value of shareholders’ investments[73];
- have a low probability of occurring but if occur would have a significant effect; [74] and
- are difficult to mitigate. [75]
Disclosure of these risks should be “specific and tailored to [the] circumstances rather than generic.”[76] ASIC’s guidance is that specificity can be achieved by “explaining the likely consequences if the risk did occur.” [77]
So how might “greenwashing” claims arise in the context of disclosure of climate change and environmental risks in a prospectus? A couple of overseas cases provide insights.
Re Oatly Group AB (April 2022)
In April 2022, a US class action was commenced by lead plaintiff (Mario Bello) against Oatly Group AB, its CEO and CFO[78]. The offer documents issued with Oatly’s May 2021 initial public offering of American Depositary Shares claimed that (Sustainability Claims):
Sustainability is at the core of our business and actionable in our products” and that “on average, a litre of Oatly product consumed in place of cow’s milk results in around 80% less greenhouse gas emissions, 79% less land usage and 60% less energy consumption.
Sustainability at Oatly is far more than achieving certain key performance indicators and corporate policies—it is a mindset that helps us navigate business decisions and build a culture that is singularly focused on pushing the boundaries of the plant-based movement.
A report from the activist organisation, Spruce Point Management, (the Spruce Point Report) identified that Oatly’s New Jersey manufacturing facility produced waste water with high concentrations of various contaminants, which would require the installation of a new wastewater treatment facility at the New Jersey facility. It is alleged these matters make the Sustainability Claims in the offer documents misleading. Upon the publication of the Spruce Point Report, Oatly’s share price fell just under 9%.
Greenpeace Canada v Kinder Morgan (May 2017)
Energy infrastructure company Kinder Morgan sought to raise up to C$1.75 billion in an IPO to help fund the expansion of its Trans Mountain pipeline project, which runs from Alberta’s oil sands to the British Columbia coast[79]. In 2017, Greenpeace Canada complained to the Alberta Securities Commission that the prospectus did not provide “full, true and plain disclosure of all material facts relating to the securities issued or proposed to be distributed” as required under the securities legislation[80]. It was alleged that:
- the Asian demand for the additional barrels of crude oil that would be made available from the project were overstated[81]; and
- the disclosure of climate-related financial risks was inadequate because it relied on International Energy Agency’s (IEA) ‘New Policies Scenario’[82] and excluded IEA’s ‘450 Scenario’ and the IEA’s ‘66% Scenario”. [83] By failing to reference either the 450 Scenario or the 66% Scenario, the prospectus failed to present the IEA’s alternative market forecasts notwithstanding that their predictions represent a significant risk to Kinder Morgan’s business model.
[1] INFO 271 (How to avoid greenwashing when offering or promoting sustainability-related products)
[2] Regulatory Guide 274.4 (Product design and distribution obligations)
[3] Regulatory Guide 274.2 (Product design and distribution obligations)
[4] An Issuer is the person responsible for preparing the disclosure document (such as the PDS).
[5] A Distributor is the person who engages with the potential investor in relation to a financial product by making offers, giving financial product advice or giving a PDS to a potential investor. The Distributor can be the Issuer where the Issuer distributes its own financial product. A Distributor can also be a person carrying on a financial services business that distributes the financial product of an Issuer.
[6] Section 994AA and s.994B of the Corporations Act 2001 (Cth) and Regulatory Guide 274.20 (Product design and distribution obligations)
[7] Section 994B(1) of the Corporations Act 2001 (Cth)
[8] See definition of “retail product distribution conduct” in s.994A of the Corporations Act 2001 (Cth). Even though, the DDO applies to financial product advice, it does not apply to personal advice (Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill 2019: Revised Explanatory Memorandum at p.24[1.84])
[9] The terms “retail clients” and “consumers” are used interchangeably in Regulatory Guide 274 (Product design and distribution obligations). See p.84, the definition of “consumer.”
[10] s.707 Corporations Act 2001 (Cth)
[11] See definition of “retail product distribution conduct” in s.994A of the Corporations Act 2001 (Cth). Even though, the DDO applies to financial product advice, it does not apply to personal advice (Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill 2019: Revised Explanatory Memorandum at p.24[1.84])
[12] Regulatory Guide 274.35 (Product design and distribution obligations)
[13] s.994B of the Corporations Act 2001 (Cth)
[14] s.994D of the Corporations Act 2001 (Cth)
[15] s.994B(5)(a) of the Corporations Act 2001 (Cth)
[16] s.994B(5) of the Corporations Act 2001 (Cth)
[17] s.994B(8) of the Corporations Act 2001 (Cth)
[18] s.994B(5)(b) of the Corporations Act 2001 (Cth)
[19] s.994B(5)(b) of the Corporations Act 2001 (Cth)
[20] Regulatory Guide 274.66 (Product design and distribution obligations)
[21] Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill 2019: Revised Explanatory Memorandum at p.19[1.59]
[22] s.994B(8) of the Corporations Act 2001 (Cth)
[23] Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill 2019: Revised Explanatory Memorandum at p.19[1.59]
[24] Regulatory Guide 274.65 (Product design and distribution obligations)
[25] s.994B(8) of the Corporations Act 2001 (Cth)
[26] Regulatory Guide 274.66 (Product design and distribution obligations)
[27] s.994B(8)(a) of the Corporations Act 2001 (Cth)
[28] s.994B(8)(b) of the Corporations Act 2001 (Cth)
[29] Regulatory Guide 274.71 (Product design and distribution obligations); Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill 2019: Revised Explanatory Memorandum at p.18[1.58]
[30] s.1317E(1) of the Corporations Act 2001 (Cth)
[31] s.1311(1) of the Corporations Act 2001 (Cth)
[32] s.994M to s.994Q of the Corporations Act 2001 (Cth)
[33] s.994M(3) of the Corporations Act 2001 (Cth)
[34] Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill 2019: Revised Explanatory Memorandum at p.17[1.49]
[35] s.1018A(1)(ca) and s.1018A(2)(ca) of the Corporations Act 2001 (Cth)
[36] s.994B(9) of the Corporations Act 2001 (Cth)
[37] Regulatory Guide 274.84 (Product design and distribution obligations)
[38] Sections 994G and 1311(1) of the Corporations Act 2001 (Cth).
[39] Sections 994E of the Corporations Act 2001 (Cth).
[40] s.1011B of the Corporations Act 2001 (Cth): issuer of a financial product; any person required to hold a financial services licence; any authorised representative; and sellers of financial products where the sale requires a PDS.
[41] An issue situation exists where a financial product is or is to be issued to a retail client under any of the following scenarios listed in s.1012B of the Corporations Act 2001 (Cth).
[42] A sale situation exists where a financial product is or is to be sold to a retail client under any of the following scenarios listed in s.1012C of the Corporations Act 2001 (Cth).
[43] A recommendation situation exists where a regulated person gives personal advice recommending the acquisition of a particular financial product to a retail client: Section 1012A of the Corporations Act 2001 (Cth)
[44] RG65.17 (Section 1013DA disclosure guidelines)
[45] Section 1013D(1)(l) of the Corporations Act 2001 (Cth).
[46] Regulatory Guide 65.21 (Section 1013DA disclosure guidelines)
[47] Regulatory Guide 65.10 (Section 1013DA disclosure guidelines)
[48] Regulatory Guide 65.45 (Section 1013DA disclosure guidelines)
[49] Section 1013C(3) of the Corporations Act 2001 (Cth)
[50] Section 1013D(1)(c) of the Corporations Act 2001 (Cth)
[51] Section 1013D(1)(f) of the Corporations Act 2001 (Cth)
[52] Section 1013E of the Corporations Act 2001 (Cth)
[53] Section 944B(5)(b) of the Corporations Act 2001 (Cth)
[54] Regulatory Guide 274.75 (Product design and distribution obligations)
[55] Regulatory Guide 274.76 (Product design and distribution obligations)
[56] Sections 1014A and 1016E of the Corporations Act 2001 (Cth). Regulatory Guide 168.134 (Product Disclosure Statements (and other disclosure documents)).
[57] Regulatory Guide 168.160 (Product Disclosure Statements (and other disclosure documents)).
[58] Section 728(3) (criminal) and s.728(4) (civil) of the Corporations Act 2001 (Cth)
[59] Sections 731 to 733 of the Corporations Act 2001 (Cth)
[60] Regulatory Guide 65.16 (Section 1013DA disclosure guidelines)
[61] There are various other types of disclosure documents (See Regulatory Guide 254.13 (Prospectuses: Effective disclosure for retail investors)
[62] The term “offer” includes invitations to apply for securities to be issued, and invitations to offer to purchases securities (s.700(2) Corporations Act 2001 (Cth)). Section 708 of the Corporations Act 2001 (Cth) sets out circumstances in which securities may be offered for sale or issue without regulated disclosure (See further discussion at Regulatory Guide 254.11 (Prospectuses: Effective disclosure for retail investors)
[63] “Securities” includes shares and debentures issued by a body, or a legal or equitable right or interest in a share or debenture. An option to acquire any security is itself a security (s.700(1) and s761A of the Corporations Act 2001 (Cth)).
[64] Regulatory Guide 254.8 (Prospectuses: Effective disclosure for retail investors)
[65] Regulatory Guide 228.1 (Prospectuses: Effective disclosure for retail investors)
[66] Section 715A of the Corporations Act 2001 (Cth)
[67] Regulatory Guide 228.22 (Prospectuses: Effective disclosure for retail investors)
[68] Section 710 of the Corporations Act 2001 (Cth)
[69] Section 728(1) of the Corporations Act 2001 (Cth)
[70] Table 7 at p.31 to Regulatory Guide 228 (Prospectuses: Effective disclosure for retail investors)
[71] Table 7 at p.31 to Regulatory Guide 228 (Prospectuses: Effective disclosure for retail investors)
[72] Regulatory Guide 228.75 (Prospectuses: Effective disclosure for retail investors)
[73] Regulatory Guide 228.75 (Prospectuses: Effective disclosure for retail investors)
[74] Regulatory Guide 228.76 (Prospectuses: Effective disclosure for retail investors)
[75] Regulatory Guide 228.75 (Prospectuses: Effective disclosure for retail investors)
[76] Regulatory Guide 228.78 (Prospectuses: Effective disclosure for retail investors)
[77] Regulatory Guide 228.79 (Prospectuses: Effective disclosure for retail investors)
[78] Consolidated Amended Complaint for Violation of The Federal Securities Laws, in Re Oatly Group AB Securities Litigation (filed in the United States District Court Southern District of New York on 3 April 2022)
[79] Greenpeace asks Alberta regulator to halt Kinder Morgan Canada IPO By Reuters Staff (19 May 2017)
[80] Letter from Dr Keith Stewart (Greenpeace Canada) to Alberta Securities Commission dated 16 May 2017.
[81] Letter dated 16 May 2017 from Greenpeace Canada to the Alberta Securities Commission
[82] New Policies Scenario of the World Energy Outlook broadly serves as the IEA baseline scenario. It takes account of broad policy commitments and plans that have been announced by countries, including national pledges to reduce greenhouse-gas emissions and plans to phase out fossil-energy subsidies, even if the measures to implement these commitments have yet to be identified or announced.
[83] 450 Scenario sets out an energy pathway consistent with the goal of limiting the global increase in temperature to 2°C by limiting concentration of greenhouse gases in the atmosphere to around 450 parts per million of CO2. The 450 Scenario, however, offered only a 50% chance of keeping warming below 2°C and hence was inconsistent with the aim of the Paris climate agreement, which is “Holding the increase in the global average temperature to well below 2 °C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 °C above pre-industrial levels, recognizing that this would significantly reduce the risks and impacts of climate change.” Therefore, the German government asked the IEA to work jointly with the International Renewable Energy Agency to shed light on the essential elements of an energy sector transition that would be consistent with limiting the rise in global temperature to this level. This resulted in an additional scenario being published in 2017, called the 66 percent scenario because it was deemed to have a 66 percent chance of keeping warming below 2°C.