There has been a lot of discussion about how mega-corporations are responding to environmental pressures and shareholders with promises to be completely carbon neutral within a few decades or years.
But, it is shocking. new studyThis month, the NewClimate Institute, Climate Market Watch and Climate Market Watch released a report on 25 mega-corporations. They found that much of this is a smokescreen. In fact, the researchers conclude, in reality, the emissions-reduction strategies for these companies, with a cumulative revenue of over $3 trillion and a greenhouse gas footprint equaling 5 percent of the world’s total, add up to only a 40 percent reduction rather than the 100 percent rollback implied by “net zero.” As worryingly, by 2030 the reductions would only amount to 23 percent as compared to 2019.
Moreover, many of the pledges involve somewhat nebulous “offsets,” an accounting trick that allows a company to plant trees or implement other carbon-sequestration strategies in lieu of reducing emissions. Yet, as the authors of the report point out, to get anywhere near net zero, companies can’t play an either/or game: Instead, they have to both implement offsets and also, at the same time, reduce emissions.
Behemoths like Amazon, Google, Ikea and Walmart all were rated in the report as showing “low integrity” when it came to their net-zero pledges. Others, including Nestlé, Unilever and the BMW Group, were awarded a “very low integrity” moniker for their publicly stated efforts.
In some instances, these low grades were due to manifest failings; in others, the companies simply weren’t providing enough data to adequately analyze their goals. In the introduction to the report, the authors wrote that, “it is more difficult than ever to distinguish between real climate leadership and unsubstantiated greenwashing.”
However, the report shows that unsubstantiated greenwashing is unfortunately all too common. Companies are more interested in appearing to be implementing major eco efforts than they are with actually fundamentally, urgently, working to reverse climate change.
Companies use a variety of techniques to make their efforts seem better than they actually are. One is to compare current and future emissions levels with abnormally high baseline years. This makes what are in fact regular annual emissions appear to be decreasing emissions. The GHG [Greenhouse Gas] ProtocolThere are three main types or emissions. Scope 1 emissions are direct emissions from a company’s property; scope 2 are indirect emissions from the purchase of electricity, heating, steam production and so on; and scope 3 are all the other emissions associated with a company’s activities, such as the distribution of a company’s product, the packaging of goods, business travel, the emissions associated with the garbage produced at the end of a product’s life, and so on.
Scope 3 is a particularly problematic area in which large companies can manipulate data to make them appear more concerned about the environment than they actually are. “For example,” the authors write on page 20 of their 127-page report, “CVS Health’s scope 3 emissions are 70-80% higher in 2019 than in 2017, 2018 and 2020, without a clear explanation, potentially undermining the meaningfulness of the company’s target for a 47% reduction in scope 3 emissions by 2030 compared to 2019.” It’s a similar strategy to the tax-dodge that the Trump Organization is accused ofThe company allegedly inflated the property values to get loans and then deflated them when paying property taxes.
In that same section, the authors note that Unilever is claiming emissions reductions for its soaps and detergents operations based on taking credit for more energy-efficient water-heating systems for customers who wash hands with the company’s soap, and the use of more renewable electricity-generation sources for running the washing machines that use the company’s detergent.
At least 7 out of 25 companies that were the focus of the research were so selective in the emissions they considered, the report concluded they could have hidden up to 98 per cent of their actual emissions footprint. This renders their public promises nothing but nonsense. Other companies camouflaged “upstream” and “downstream” emissions — upstream emissions being connected with the production of goods, and downstream emissions being associated with the consumption of those goods — including energy sales and the daily operations of their stores, from easy identification. In some instances, they only mentioned them in their report footnotes — and this despite the fact that the vast majority of their carbon emissions come from these sources. Others sold off carbon-intensive operations and reported declining emissions. In reality, however, they had simply moved the emissions from one operation to another.
The malfeasance is not stopping in one place. In many cases, the promise to reach net 0 is apparently accompanied by No Specific emissions reduction targets for each year are not possible, making the pledge little more than a feel-good gesture. “12 of the companies with (net-)zero emission targets have made no specific commitment for the reduction of their own emissions in the net zero target year,” the authors write. These included Amazon, which the authors lambasted for pledging to get to net zero but not actually putting forward “any specific [greenhouse gas] emission reduction target.” A similar lack of specificity accompanied BMW’s net-zero pledge.
The hard part is pledging to reach net zero. The hard part is actually getting there. This involves restructuring supply chains to reduce greenhouse gas emissions at every stage of the production and distribution process. The world’s largest corporations are perfecting the art of green spin. But, as this report shows, with catastrophic climate change now a looming reality, it’s past time for them to go beyond the spin and actually ensure that their public commitments are met over the coming years.
