World’s largest companies are greatly exaggerating their climate progress

It’s not only up to governments to tackle the climate crisis, companies also have their fair share of responsibility, especially the big ones — especially as many of them are directly responsible for greenhouse gas emissions. The problem is many of these companies are failing to live up to their climate pledges. Researchers found that they will cut their greenhouse gas emissions by only 40% instead of the 100% cuts claimed.

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The New Climate Institute, an independent European organization focused on climate change action, published a report that looks into the efforts of 25 high-profile organizations, from Amazon to Ikea, that have pledged to cut their emissions to net-zero. They found that, on average, the plans have little substance and coherence. 

Researchers were especially concerned for the short-term, as they found companies would only reduce their emissions by about 23% on average by 2030. While significant, this is not nearly enough — climate scientists have highlighted the need to cut emissions by at least 50% in the next decade so to limit global warming to 1.5 degrees Celsius, and big companies are not on the right path. 

“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 ambitions,” Thomas Day, lead author, said in a statement.

Climate pledges

The report scored companies on a set of criteria, including their targets, how much carbon offsetting they plan to use (paying for projects that reduce emissions to compensate for greenhouse gases emitted elsewhere), progress on their own emissions reduction, and the level of transparency in setting their targets and reporting on them.

To their surprise, none of the 25 companies reviewed achieved a high standard according to the criteria. Amazon, Ikea and Google showed a “low integrity,” while 11 had a “very low integrity,” including Nestlé, Accenture, Carrefour, Unilever and JBS. The best one ranked, with “reasonable integrity,” was the container shipping line and vessel operator Maersk. 

Carrefour, for example, committed to be carbon neutral by 2040 but the claim only covers less than 2% of its emissions and to less than 20% of their stores worldwide. Google has shown leadership in some aspects, but their statement of being carbon neutral since 2007 is a misrepresentation and actually excludes over half of its emissions, the researchers explained.

The companies analyzed account for 5% of global greenhouse gas emissions, which means that while they have a big share of responsibility they also have a big potential to lead in the efforts to tackle the climate crisis. Today they are failing to do so, the researchers said, asking government to step in and regulate corporate claims on climate action.

Replying to the criticism from the report, Nestlé said in a statement that the report “lacks understanding” of the companies’ climate approach and has “significant inaccuracies.” Meanwhile, Amazon reaffirmed its target to be net-zero carbon by 2040 and said to be on track to power its operations with 100% renewable energy by 2025. However, companies failed to specifically address the concerns raised by the researchers.

The full report can be accessed here. 

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