Many of the world’s largest corporations are using false, misleading or ambiguous green claims to avoid meaningful action on climate change, according to a new report released by non-governmental organisations the NewClimate Institute and Carbon Market Watch on 13 February.
Based on the Climate Corporate Responsibility Monitor, the new report finds that the net-zero pledges made by 24 of the world’s largest global companies would only lead to emissions reductions of 36% by mid-century. It suggests the companies are getting away with misleading green claims by using loopholes, omitting data, choosing start dates when their emissions were higher and creating their own fallacious measures of climate action.
Some of the worst offenders are household names such as Walmart, Carrefour and Nestlé, according to the report.
Compared with last year’s edition of the same report, the overall transparency of companies’ disclosure has remained ‘moderate’. Carbon Market Watch notes that out of the ten companies assessed in both years, just Maersk and Deutsche Post DHL have made progress on their disclosure. Amazon, Apple, Carrefour, Google, JBS, Nestlé, Volkswagen and Walmart have not.
Half of the 24 companies make no specific emissions-reduction commitment for their net-zero target year. Five other businesses agree to cut emissions by less than 40% along the whole value chain. Carrefour and Walmart pledge to reduce emissions by just 1% and 9%, respectively, below 2019 levels by 2050 as a result of scope exclusions.
Despite being verified by the SBTi, 15 out of 24 companies fail to reach 1.5°C-aligned decarbonisation targets for their respective industries. For example, Mercedes-Benz and Volkswagen do not set 1.5°C-aligned phase-out dates for internal combustion engines in line with the latest scientific findings.
“At a time when corporations need to come clean about their climate impact and shrink their carbon footprint, many are exploiting vague and misleading ‘net zero’ pledges to greenwash their brand while continuing with business as usual,” said Carbon Market Watch’s executive director Sabine Frank. “This dangerous procrastination must stop. Since multinationals have both an oversized impact on the planet and the means to reduce their carbon footprint, they must take real action to clean up their act and not just their image by slashing their emissions.”
Carbon Market Watch has produced a package of model policies to promote green corporate leadership and combat greenwashing, including a ban on companies making net-zero and carbon neutrality claims and recommending that they report absolute emission reductions and avoid double counting emissions reductions already accounted for by countries. Carbon Market Watch and the NewClimate Institute sent a joint letter to EU policymakers pressing them to adopt these recommendations on the day of the report’s release.
The European Commission is due to propose a new anti-greenwashing law in March that will rein in companies’ misleading green claims. A green-minded revision of the EU’s unfair commercial practices law is already under way.