A recent corporate climate responsibility report says the world’s largest companies have largely failed their climate pledge test due to lack of clear net-zero targets and limited commitments to reduce emissions.
“The top 25 climate pledges of the world’s largest companies actually only commit to reducing their emissions by 40% on average, not 100% as their “net zero” and “carbon neutral” claims suggest,” says the Corporate Climate Responsibility Monitor 2022, conducted by the NewClimate Institute in collaboration with Carbon Market Watch.
It evaluates 25 major companies, operating across sectors and geographies, for the transparency and integrity of their core climate commitments.
As per the report, only one company’s net-zero commitment was assessed as having “reasonable integrity”; three with “moderate”, 10 with “low” and the remaining 12 were rated as having “very low” integrity.
The main commitments of only three of the 25 companies (Maersk, Vodafone and Deutsche Telekom) clearly commit to a deep decarbonisation of more than 90% of the emissions of their entire value chain. At least five of the companies would only reduce their emissions by less than 15%, often excluding emissions upstream or downstream of their value chain.
The 13 companies that have backed their net-zero emissions pledges with explicit emission reduction commitments commit, on average, to reduce emissions across their entire value chain from 2019 by just 40%. The other 12 have no specific emission reduction commitments for their net zero target year.
The report highlighted that major climate promises from companies require detailed evaluation and, in most cases, cannot be taken at face value.
For the minority of the 25 companies assessed, their headline commitments serve as a useful long-term vision and are supported by specific short-term emission reduction targets. While none of the promises have a high degree of integrity overall, Maersk came out on top, with reasonable integrity, followed by Apple, Sony and Vodafone with moderate integrity.
However, most companies with net-zero emissions or carbon neutrality commitments fail to set ambitious targets.
Overall, the analysis finds that top promises from Amazon, Deutsche Telekom, Enel, GlaxoSmithKline, Google, Hitachi, IKEA, Vale, Volkswagen and Walmart have low integrity and those from Accenture, BMW Group, Carrefour, CVS Health, Deutsche Post DHL , E .ON SE, JBS, Nestlé, Novartis, Saint-Gobain and Unilever have very low integrity.
“Many company promises are undermined by controversial plans to cut emissions elsewhere, hidden critical information and accounting tricks,” the report said.
“We set out to uncover as many replicable good practices as possible, but were frankly surprised and disappointed by the overall integrity of the companies’ claims,” said Thomas Day of the NewClimate Institute, lead author of the study.
“As pressure mounts on companies to act on climate change, their ambitious-sounding headlines often lack real substance, potentially misleading both consumers and the regulators who are critical in guiding their action. strategic direction. Even companies that are doing relatively well are exaggerating their actions,” he added.
“Misleading business advertisements have a real impact on consumers and policymakers. They deceive us into believing that these companies are taking sufficient measures, when the reality is far from it.” said Gilles Dufrasne of Carbon Market Watch.
Dufrasne said that without more regulation, this will continue. “We need governments and regulators to step up and stop this greenwashing trend,” he added.
Promising examples of climate leadership were also identified. Google is developing innovative tools to purchase high-quality renewable energy in real time; this is being picked up by other companies. Maersk and Deutsche Post are making significant investments in decarbonisation technologies for transport and logistics. There is still ample potential for companies to replicate and extend these emerging best practices.