File photo Ted S. Warren/AP
NEW YORK — Many of the world’s largest companies are not taking significant enough action to deliver on their promises to significantly reduce the impact of their greenhouse gas emissions in the decades to come.
This is the conclusion of a new report from the NewClimate Institute, an environmental organization that fights against global warming. Its researchers, who looked at the actions of 25 companies, found that many mislead consumers by using accounting practices that render their environmental goals relatively meaningless or exclude key elements of their operations from their calculations.
The companies have pledged to reduce their emissions or offset their emissions through techniques such as planting carbon-capturing forests over self-imposed time periods ranging from 2030 to 2050.
The authors chose to study giant corporations, including Amazon and Walmart, which have made bold climate pledges and which, due to their size, are considered particularly influential. In recent years, large corporations have become increasingly committed to significantly reducing their carbon footprint, a priority of growing importance to many of their customers, employees and investors.
The NewClimate Institute concluded that while many companies have pledged to achieve net zero emissions, the 25 companies studied have collectively committed to reducing their emissions by around 40% – not the 100% that people could be led to. to believe according to the net of companies. zero or carbon neutral commitments.
“We were frankly surprised and disappointed with the overall integrity of the companies’ claims,” said Thomas Day of the NewClimate Institute, one of the study’s lead authors. “Their ambitious headlines too often lack real substance, which can mislead both consumers and regulators who are central to guiding their strategic direction. Even companies that do relatively well exaggerate their shares.”
Of the 25 companies the researchers studied, 24 relied too heavily on carbon offsets, which are plagued with problems, according to the report. This is because carbon offsets often rely on carbon removal ventures such as reforestation projects. These projects suck up carbon but are not ideal solutions because forests can be razed or destroyed by forest fires, releasing carbon back into the air.
Most companies, the report says, presented vague information about the scale and potential impact of their emissions reduction measures or may have exaggerated their use of renewable energy.
The report called Amazon’s goal of net zero carbon by 2040 unfounded. He said it was unclear whether Amazon’s goal referred only to carbon dioxide emissions or to all greenhouse gases. The report also said it was unclear to what extent Amazon planned to reduce its own emissions, as opposed to buying carbon offset credits that rely on nature-based solutions.
In response, Amazon said it has been transparent about its investments in nature-based solutions and disputed that its net zero goals are based on offsets. The company said it was on track to power its operations with 100% renewable energy by 2025, five years ahead of its original 2030 target. It also highlighted other initiatives, including the rollout of 100,000 electric delivery vehicles by 2030.
As an example of a misleading goal, the report says CVS Health could potentially meet its 2030 emissions goal with little effort because it compared that goal to a baseline year that included extraordinarily high emissions.
A CVS spokeswoman responded that after the company merged with Aetna in late 2018, 2019 was the first full year of data the company could use as a benchmark for the new combined entity.
“By 2030, we expect to reduce our environmental impact by more than 50%, including a reduction in our energy consumption and the use of paper and plastic,” the company said.
The NewClimate report says Nestlé, among the companies with the lowest ratings, had emissions reduction plans that covered only part of its business and that its net zero targets relied on carbon offsets. The company also provided few details about the renewable electricity sources it was looking for, it said.
Nestlé responded that its emission reduction targets cover all of its operations, that it is reducing greenhouse gas emissions by 50% by 2030 and that its factories and offices are switching to renewable electricity.
Jonathan Overpeck, dean of the University of Michigan’s School for Environment and Sustainability, who had no role in the NewClimate report, said: “Far too many companies are falling behind when it comes to Meaningful decarbonization: Companies’ decarbonization goals and plans to achieve them are usually much less compelling than needed to be successful in stemming climate change.”
Some other outside experts suggested that the NewClimate report was too critical of carbon offsets.
“Forest offsets are difficult, but they can be real and significant,” said Christopher Field, director of the Stanford Woods Institute for the Environment at Stanford University. “Too strong a focus on decarbonization pathways that do not include offsets will slow overall progress and increase costs.”
The report noted some things that companies are doing well. Shipping company Maersk received top marks despite the challenges its industry faces to reduce emissions. The authors noted that Maersk is researching alternative fuels and has partnered with a renewable energy company to establish an e-methanol plant. Maersk did not immediately respond to requests for comment.
Most of the companies studied, 15 of them, presented plans to reduce their “Scope 1” and “Scope 2” emissions, which are emissions emitted directly by the company or by its use of electricity, indicates The report. But these companies have not addressed their “Scope 3” emissions; these include emissions emitted by suppliers or customers who use their products. Scope 3 emissions represent, on average, 87% of all the emissions of the 25 companies studied, specifies the group.
The report praised Walmart, which has pledged to be net zero by 2040, for following best practice by committing to zero operational emissions without using offsets and setting short-term goals to these reductions include using 100% renewable energy by 2035. But Walmart has been accused of not including Scope 3 emissions. Walmart has a voluntary program that guides its product suppliers to reduce emissions , and nearly a quarter of its suppliers have joined, according to the report.
Walmart responded that it has a goal of reducing or avoiding one billion metric tons of Scope 3 emissions and that it reports openly on its progress.
The report stresses that companies should take more responsibility for reducing Scope 3 emissions. Yet tracking these emissions in supply chains can be difficult, especially when working with small businesses, a said Maggie Peloso, an attorney involved in climate change risk management and environmental litigation.
“It’s not always as easy as calling someone and saying, ‘Hey, I want to know what your emissions were from the factory when you produced those 100 boxes of stuff that you sent to my stores and sold them,'” Peloso said. .
Among the suggestions for improvement offered by the NewClimate Institute is that companies focus on short-term emission reduction goals for the next five to ten years. He also suggested that companies set specific emissions reduction targets with transparent accounting, instead of ambiguous net-zero targets.
If national governments created policies and regulations to achieve the goals they set for themselves, it would be much more effective, suggested John Reilly, who served as co-director of the Joint Program in Global Change Science and Politics at MIT. . “On the hopeful side, perhaps there are ongoing efforts within companies to create rules, procedures and strategies to achieve their lofty goals,” he said.