Achieving carbon neutrality will be difficult, especially if defined properly. Also, companies that promise it should not be taken at their word. No more than the others who make the same promise elsewhere.
The record is overwhelming. For a second consecutive year, research groups NewClimate Institute and Carbon Market Watch have looked in detail at the greenhouse gas (GHG) reduction plans of 24 companies said to be among the “biggest climate leaders” . Conclusion: their promises of carbon neutrality are far from being as clear as they seem – not to say misleading – in addition to being very badly on track to be realized, we reported on Monday.
The companies in question are the three largest in the world from eight major economic sectors to have rallied to “Getting to Zero”, a United Nations campaign in which actors other than countries commit to achieving carbon neutrality for 2050 and where the number of participating companies jumped from 3,000 to 9,000 in one year. The sectors represented range from automotive to electronics, agriculture and food, heavy industry and fashion. Together, the 24 multinationals studied had sales of US$3.16 trillion in 2021 and accounted for around 4% of global GHG emissions.
When we take a closer look at their game plan, our great champions in the fight against global warming will arrive at best with a median reduction in their GHGs of 21% from 2019 to 2030, half of what it would take to be on the trajectory of a maximum temperature increase of +1.5°C. And far from the target set, their total emissions will have decreased by just over a third (-36%) when they promise that they will have achieved carbon neutrality in 2040 or 2050.
Count properly
This “gap” between companies’ promises and reality is due in particular to a much too narrow vision of their GHG emissions, where the multinational only takes into account its own production activities (scope 1) or the energy sources it uses (scope 2), choosing to ignore or underestimate the pollution of its suppliers or customers throughout the life cycle of its products (scope 3).
More than 90% of the carbon footprint of the companies studied is located upstream or downstream of their production activities, observed the authors of this week’s report. And how, for example, could an oil company or car manufacturer seriously promise to achieve carbon neutrality without considering the impact their products will have on global warming, they asked.
Another reason for the gap between promises and reality is that corporate reduction targets often rely heavily on offset mechanisms, such as planting trees, funding green projects overseas, and use of carbon capture and storage technologies. But such wildcards should be invoked sparingly because they are often credited with more power than they actually have, experts say. So much so that they should generally not be counted on to do more than 5% to 10% of the road to carbon neutrality.
All things considered, the “climate leaders” Samsung (-20% GHG), Walmart (-9%) or Carrefour (-1%) will thus still be very far from the goal in 2050. The tech giants Amazon ( -16%), Google (-37%), Microsoft (-38%) and Apple (-63%), for their part, should have more or less come a long way in 2030, but after that, nothing can be done to assert. As for Volkswagen, Pepsi, ArcelorMittal or American Airlines, there is nothing solid enough to draw from their GHG reduction plans.
Others should do much better, fortunately. This is particularly the case for the car manufacturer Stellantis (-90%), the German company Thyssenkrupp (-89%), the clothing retailer H&M (-90% for 2040), the shipping company Maersk (-91% for 2040 ). Their secret? A more rigorous analysis of their activities. Help also for their suppliers so that they, too, reduce their climate footprint. But the audacity (or the imprudence) also to count on new technologies which remain to come.
Throw a cold
This week’s report did not fail to create a certain cold with other research or certification organizations supposed to do the same work, but less severe in their judgment with regard to the promises of reduction of GHG of the companies. These efforts are not perfect, but they are still going in the right direction. And then, everyone is doing their best to keep up with the rapidly changing science, standards and best practice guides in this area, including the people behind the Science Based Targets initiative (SBTi)a project supported by the United Nations and the World Wide Fund for Nature (WWF), among others.
It is true that international standards are tightening, admitted the authors of the report. But it is also true that if companies today commit to reducing their carbon footprint, it is not out of magnanimity, but because they feel more and more pressure from their shareholders. and consumers. And that they prefer to go for voluntary measures rather than see governments imposing more restrictive environmental rules on them.
Obviously, this will not be enough. Governments will have to put in place the necessary measures to accelerate the pace, say the authors of the Corporate Climate Responsibility Monitor 2023. It will also make competition fairer between companies that have started to move and those that are dragging their feet.
But it’s not just companies whose efforts to reduce their climate footprint are variable and clearly insufficient. There are countries and their governments too.
In an expected report on the new international standards that should be applied to put an end to the “greenwashing” in which too many companies indulge, the president of a special committee of experts of the United Nations had, for example, this fall, this first recommendation. “We cannot say we are in favor of carbon neutrality while continuing to build or invest in new sources of fossil energy. Coal, oil and gas account for more than 75% of global GHG emissions. Carbon neutrality is totally incompatible with investing in fossil fuels. His name, Catherine McKenna, former Minister (of the Environment) of Canada, one of these countries, precisely, which is currently struggling to reconcile its promises and its actions.