SPOT THE GREENWASHING: Corporate climate pledges are everywhere. Some are solid, others definitely are not.
- Jun 3, 2022 2:15 pm GMT
There is good reason for cynicism about greenwashing. Companies make a lot of claims. According to the author of this New York Times article, some are valid, others are decidedly
"outright disinformation (oil companies, I’m looking at you)."
But it is worth considering how to give credit where it is due and to spot the greenwashing.
The author asserts that even though it would be easy to just dismiss all claims that an enterprise is actively pursuing a greener future, some of them are "trailblazers, and, if we fail to recognize their efforts, they’ll have less incentive to do the hard work of actually reducing greenhouse gas emissions." The US Securities and Exchange Commission is making an effort to "standardize the way businesses disclose information about investments that claim to be green, sustainable or low-carbon."
There seems to be agreement that "Becoming carbon neutral involves two things: Companies need to decarbonize their business by lowering their emissions, and then compensate for the unavoidable emissions through carbon offset programs like reforestation projects and carbon removal technologies."
But there are problems:
One is that "Forests that form the basis for carbon offsets are complicated because those forests can burn, releasing their stored carbon into the air and defeating the idea of an offset." And, of course, carbon removal technologies are far from mature with respect to both costs and storage sites.
Another is that "Most pledges have 2050 as their target date. That’s because of the scientific consensus that, if the world can stop adding carbon dioxide to the atmosphere by then, we should be able to hold warming to 1.5 degrees Celsius."
But 2050 is a long way ahead, so "Experts say any credible pledge should have short- and medium-term targets, too, for every five or ten years."
Another problem is that, as the SEC is trying to address:
"The largest share of emissions tied to a company’s business most likely happen somewhere outside that company. For example, extracting the raw materials needed to manufacture a product. Or, home delivery.
Take JBS, the world’s largest meatpacker. Emissions from their offices and slaughterhouses are only 3 percent of their total emissions. The rest are tied to the thousands of farms that supply them with cattle, according to a recent analysis by the Institute of Agriculture and Trade Policy, a research organization based in Minnesota.
For banks, the difference is even more striking. Emissions from their portfolios are, on average, 700 times greater than their own, a recent study found."
The SEC did indeed propose a rule in March that included a provision "to require publicly listed companies to disclose their climate-related risks"... "including in the agency’s nearly 500 page draft rule — the disclosure of a company’s Scope 3 emissions, or the planet-warming emissions that are produced by their suppliers, customers and more." Naturally, there is massive pushback on the proposal "...by business groups, Republican lawmakers and conservative organizations." "It’s too soon to say how the SEC will respond to the pushback on this topic, among others."
And, perhaps, the most despicable problem:
"It’s not uncommon for companies making bold announcements to be lobbying against climate action at the same time. This is also considered a form of greenwashing.
Last year, a watchdog group called Accountable.US found major corporations that had expressed deep concern over climate change were also backing business groups fighting climate legislation."
Personally, I was surprised and dismayed by some of the companies on their list.
And the EU seems intent on muddying the waters further:
"The green labeling system from the European Commission, the EU’s executive arm, would define what qualifies as an investment in sustainable energy in the 27-nation bloc. Under certain conditions, gas and nuclear energy could be part of the mix..."
"“We are setting out strict conditions to help mobilize finance to support this transition away from more harmful energy sources like coal," said Mairead McGuinness, the commissioner in charge of financial services."
They seem to be saying that if it is greener than coal, it is GREEN. Come on! Greta is correct ("Blah, Blah, Blah").
It is to be hoped that at least the most obscene greenwashers can soon be brought into line in order to allow the committed and active reformers to garner the credit they deserve. But it remains very difficult for the ordinary consumer/investor to separate the fake from the real. I fear we are far from transparency for the foreseeable future.
"Humans pumped 36 billion tons of the planet-warming gas into the atmosphere in 2021, more than in any previous year. It comes from burning oil, gas and coal."
There is more carbon dioxide in the atmosphere now than at any time in at least 4 million years, National Oceanic and Atmospheric Administration officials said.
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