Corporate net-zero pledges have a long way to go
A close look at 25 of the world's largest companies with net-zero emissions pledges shows that most of those goals aren't what they seem.
Why it matters: Evaluating corporate pledges to reduce emissions can help consumers decide which companies to purchase from or invest in, and can help motivate poorly reviewed companies to take additional action.
- Given the large carbon footprint of the world's biggest corporations, ensuring that they meet their pledges is critical to limiting the severity of global warming.
Driving the news: Corporate emissions reduction commitments have proliferated in the past few years, with a slew of net-zero commitments made in the run-up to and during last year's Glasgow Climate Summit.
- The new report, released yesterday by the NewEconomy Institute and Carbon Market Watch, analyzed disclosures and reports from 25 large companies that together accounted for about 5% of global greenhouse gas emissions in 2020.
Details: Researchers ranked just one company's net-zero pledge as having "reasonable integrity."
- Coming out on top was Maersk, the marine shipping giant that has pledged to reach net-zero emissions in 2040 and is investing in low or zero-carbon fuels.
- Three out of the 25 companies, Apple, Sony and Vodafone, had "moderate integrity."
- Ten were ranked as "low integrity," including the headline pledges of Amazon, Google, Hitachi, IKEA, Volkswagen and Walmart, while the rest were categorized as "very low integrity."
- The 13 companies out of the 25 that have made explicit emissions reduction commitments have actually only committed to cutting their full value chain emissions by 40% when compared to 2019 levels, the report finds.
- Three of the companies pledged to cut more than 90% of their full value emissions: Maersk, Vodafone and Deutsche Telekom.
Between the lines: Common flaws in company planning include insufficiently ambitious short-term emissions targets and gaps in how they account for the emissions contained throughout their value chain, from upstream suppliers to downstream customers, per the report.
- The report found that eight of the 25 companies they researched excluded either upstream or downstream emissions that accounted for more than 90% of the emissions under their control.
- In addition, companies were dinged for relying too much on natural carbon offsets, such as forests, to absorb their emissions.
Yes, but: The report lauds some companies for their innovative approaches, including Google's program to match data centers' energy use with zero-carbon power on a 24/7 basis, and Apple for trying to drive down its supply-chain emissions.
What they're saying: "Setting vague targets will get us nowhere without real action, and can be worse than doing nothing if it misleads the public," said Gilles Dufrasne of Carbon Market Watch, in a statement.