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World's largest companies accused of greenwashing

Companies claim to have set carbon neutral targets, but most amount to an average emissions reduction of just 40 per cent - not the 100 per cent suggested by 'net-zero'

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Companies claim to have set carbon neutral targets, but most amount to an average emissions reduction of just 40 per cent - not the 100 per cent suggested by 'net-zero'

Apple, Amazon and Google were among the companies said to 'lack integrity' when it came to setting - and following - net-zero pledges

Net-zero targets by 25 of the world's largest companies - responsible for 2.7 gigtatonnes of CO2 equivalent (GtCO2e), or five per cent of global greenhouse gas emissions - cannot be taken at face value, according to a new report. Amazon and Google were among the 10 firms whose pledges were assigned a 'low' integrity, signalling that they could not be fully trusted.

The findings of the Corporate Climate Responsibility Monitor, which was conducted by NewClimate Institute in collaboration with Carbon Market Watch, showed that of the 25 major companies evaluated, only one company's net-zero pledge - that of logistics giant Maersk - was considered to have 'reasonable integrity'.

Three companies' pledges - Apple, Sony and Vodafone - were evaluated as having 'moderate' integrity'; ten were assigned a 'low' integrity; and the remaining 12 were given a 'very low' integrity.

Overall, the analysis found that the headline pledges of Amazon, Google, Deutsche Telekom, Enel, GlaxoSmithKline, Hitachi, IKEA, Vale, Volkswagen and Walmart have low integrity and those of Accenture, BMW Group, Carrefour, CVS Health, Deutsche Post DHL, E.ON SE, JBS, Nestlé, Novartis, Saint-Gobain and Unilever have very low integrity.

The research concluded that many large companies' net zero and carbon neutral pledges are 'undermined' by plans for the reduction of emissions elsewhere, hidden critical information and accounting 'tricks'.

Thomas Day, climate policy analyst at the NewClimate Institute and lead author of the study, said: "We set out to uncover as many replicable good practices as possible, but we were frankly surprised and disappointed at the overall integrity of the companies' claims.

"As pressure on companies to act on climate change rises, their ambitious-sounding headline claims all too often lack real substance, which can mislead both consumers and the regulators that are core to guiding their strategic direction. Even companies that are doing relatively well exaggerate their actions."

Now is not the time for creative accounting

While all of the companies in the report mention some form of zero-emission, net-zero or carbon-neutral target, most of these goals fall far short of the 100 per cent reduction suggested by 'net-zero'.

Thirteen of the companies have backed their headline pledges with explicit emission reduction commitments - although they only commit, on average, to reducing their full value chain emissions by 40 per cent from their 2019 level. The other 12 firms have no specific emissions reduction commitments for their net-zero target year.

'At least five of the companies only commit to reduce their emissions by less than 15 per cent, often by excluding upstream or downstream emissions,' the authors note. Upstream and downstream emissions are also known as scope 3, which often form the largest proportion of a company's greenhouse gas output.

The authors later state, 'Scope 3 emissions account on average for 87 per cent of total emissions for the 25 companies assessed in this report, but only eight...disclosed a moderate level of detail on their plans to address these emissions.'

There was some positive news on that front. The monitor found that Maersk, Vodafone and Deutsche Telekom have committed to 'deep decarbonisation' of more than 90 per cent of their full value chain emissions.

However, the report also revealed that carbon offsetting approaches were undermining the integrity of climate pledges, with 24 of the 25 companies analysed relying on offsetting credits 'of varying quality'.

Both Apple and Google were found to be relying heavily on creative reporting to support their claims of carbon neutrality. For example, Apple's claims of carbon neutrality only apply to its scope 1 and 2 emissions, business travel and employee commuting; together, these make up just 1.5 per cent of the company's emissions, with the vast majority coming from upstream and downstream supply chains. Likewise, Google's claimed carbon neutrality doesn't cover its scope 3 emissions, which represent about 60 per cent of the company's greenhouse gas output.

Gilles Dufrasne, policy officer at Carbon Market Watch, said: "Misleading advertisements by companies have real impacts on consumers and policymakers. We are fooled into believing that these companies are taking sufficient action, when the reality is far from it.

"Without more regulation, this will continue. We need governments and regulatory bodies to step up and put an end to this greenwashing trend."

World's largest companies accused of greenwashing

Apple, Amazon and Google were among the companies said to 'lack integrity' when it came to setting - and following - net-zero pledges

Now is not the time for creative accounting

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