GARP SCR Exam 2026: Paris Agreement, NDCs, and Net Zero Targets — Understanding These Will Unlock Your Exam

GARP SCR Exam 2026: Paris Agreement, NDCs, and Net Zero Targets — Understanding These Will Unlock Your Exam

If you’re studying for the SCR 2026 exam, treat Paris Agreement → NDCs → net zero as one integrated “policy-to-risk transmission mechanism,” not three separate definitions. The exam is designed to test whether you can translate climate-policy architecture into credible transition pathways, scenario assumptions, and ultimately financial risk impacts. That’s why these concepts recur across the policy/governance content and the net zero material, and why they show up naturally in case-style questions (the SCR exam is 80 multiple-choice questions plus a multi-part case study in a four-hour sitting).

The Paris Agreement: what you must know beyond the headline GARP SCR Exam 2026, Paris Agreement, Net Zero

At the highest level, the Paris Agreement sets (1) a temperature goal and (2) a recurring process for tightening national action over time. Article 2 frames the global objective: hold warming well below 2°C and pursue efforts to limit it to 1.5°C.

Where candidates often lose marks is missing the “how it works” plumbing:

• NDC cycle (“ratchet mechanism”): countries submit climate plans every five years, and each new plan must represent progression and reflect highest possible ambition.

• Enhanced Transparency Framework (ETF): the credibility layer. Parties must submit Biennial Transparency Reports (BTRs) every two years, with the first due by 31 Dec 2024, enabling more consistent tracking of emissions and implementation.

• Global Stocktake (GST): every five years, the world collectively assesses progress; the first GST concluded at COP28 and is explicitly meant to inform the next round of NDCs.

• Article 6 (cooperative approaches and markets): enables international cooperation, including tradable mitigation outcomes, but introduces accounting and integrity issues (double counting, “corresponding adjustments,” and reputational risk).

An “exam-ready” way to remember this: Paris sets the destination (temperature), the steering wheel (NDC cycle), the dashboard (transparency), and the satnav recalculation (GST). GARP SCR Exam 2026, Paris Agreement, Net Zero

NDCs: how to read them like a risk professional

A Nationally Determined Contribution (NDC) is a country’s stated plan and targets—often covering emissions reductions, key sectors, and (in many cases) adaptation and support needs. NDCs are lodged with the UN climate regime and updated every five years.

For SCR purposes, NDCs matter less as political documents and more as forward signals of transition risk. They help you infer:

1. Policy direction and pace (carbon pricing, renewables targets, methane measures, deforestation rules, etc.).

2. Sectoral pressure points (power, transport, heavy industry, buildings, land use).

3. Implementation credibility (legal frameworks, governance, financing, conditionality).

The latest official synthesis is particularly exam-relevant because it shows how NDCs are evolving. The UNFCCC’s 2025 NDC Synthesis Report (covering new NDCs submitted from 1 Jan 2024 to 30 Sept 2025) highlights: a growing share of economy-wide targets, explicit referencing of the GST outcome, and trajectories that are broadly consistent with moving from 2030 targets toward long-term net zero aims—while still requiring acceleration. It also quantifies projected emissions for the group of Parties covered (e.g., projected 2035 emissions levels and reductions versus 2019, including conditional elements).

A common exam trap: assuming NDCs are only mitigation targets. The synthesis underscores that NDCs frequently include adaptation, finance, technology transfer, capacity-building, and loss and damage-related elements—which is exactly the kind of cross-linking a case study may test.

Net zero targets: definitions, credibility, and what “counts”

Net zero is often used loosely in markets, but the exam will reward precision.

The IPCC distinguishes between:

• Net zero CO₂: CO₂ emissions are balanced by CO₂ removals.

• Net zero GHG: metric-weighted greenhouse gases (often using 100-year global warming potentials) are balanced by removals—typically implying net negative CO₂ to counter residual non-CO₂ emissions.

For credibility, the United Nations High-Level Expert Group on the Net Zero Emissions Commitments of Non-State Entities stresses that non-state net zero commitments should prioritize deep emissions reductions and treat carbon credits as a limited tool for residual emissions rather than a substitute for decarbonization.

Also know why “net zero by 2050” shows up everywhere: the COP28 GST outcome and related political signals emphasize aligning action this decade with keeping 1.5°C within reach, including language around transitioning away from fossil fuels in energy systems. And the latest UNEP assessment reinforces the gap between current pledges and Paris-aligned pathways, which underpins transition-risk narratives and scenario selection.

The high-marks checklist for SCR questions

When you see Paris/NDC/net-zero language in a vignette, run this quick logic:

• Which lever is it? (NDC target, sector policy, disclosure/transparency rule, Article 6 crediting, etc.)

• What’s the transmission channel? (policy → prices/costs → demand/tech substitution → cash flows → valuation/credit)

• Is the target credible? (scope coverage, interim milestones, governance, reliance on offsets, data quality via BTRs)

• What’s the scenario implication? (orderly vs disorderly transition; timing of policy shock; sector dispersion)

Master that chain, and these topics stop being memorization-heavy and become your highest-yield scoring area—because you’ll be answering like a risk professional, not like a glossary.