Extract from ABC News
The world's largest transnational companies are failing to provide evidence to back up their environmental restoration claims.
Key points:
- The world's largest companies are failing to provide evidence for their environmental claims
- Lobby groups in Australia are opposing potential changes that could clamp down on greenwashing here
- Critics say government-aligned carbon-neutral certifier Climate Active is helping polluting companies "greenwash" their images
That's according to a new analysis of the mandatory and voluntary restoration programs that the corporations say they are engaging in.
The findings come as submissions to Australia's senate inquiry into greenwashing, including from a fossil fuel peak body, show many industry groups are pushing back against moves to change advertising regulations here.
The research published in Science found two-thirds of the world's 100 largest companies claim to carry out some form of environmental restoration, such as forest replanting, freshwater flow returns and marine habitat rehabilitation.
Yet more than 90 per cent of written reports on those projects "fail to report a single ecological outcome".
Study lead author Tim Lamont from Lancaster University said this lack of data makes it impossible to verify whether these companies are doing what they claim.
"When we originally started this project, we were hoping to be able to quantify the combined impacts of corporate-led restoration projects. But we soon realised there was such a lack of information that this wouldn't be possible," Dr Lamont said.
"As it stands, there's no way of knowing the impact of these businesses' work in ecosystem restoration."
He said large corporations have "huge potential for good", but that there needed to be better frameworks for how restoration was done and accounted for.
"We're seeing increasing pressure from consumers, shareholders, and even from employees within businesses who want to see their companies making a positive difference in the world.
"People are also wary of greenwashing, and want to see concrete evidence to back up business' claims of environmental leadership."
Fossil fuel lobby opposes changes to greenwashing regulations
Broadly speaking, greenwashing is where a company makes misleading or false claims about the environmental sustainability of a product, service or activity they perform.
Australia's senate inquiry into greenwashing was launched in March this year, a few weeks after the Australian Competition and Consumer Commission (ACCC) found more than half of 247 surveyed businesses had made "concerning claims about their environmental credentials".
The ACCC said the use of "vague or unclear" terms like "environmentally friendly", "green", or "sustainable" needed to be backed up with actual scientific data and transparent reporting.
Submissions to the inquiry have now closed, but director of the Australia Institute's climate and energy program Polly Hemming said several submissions showed some business and lobby groups were still pushing back against making changes to regulations for environmental advertising, despite the ACCC's findings.
Particularly concerning, Ms Hemming said, was a submission from oil and gas peak body the Australian Energy Producers, formerly the Australian Petroleum Production and Exploration Association (APPEA), which recommended the scope of the inquiry be broadened to examine what "legal obligations" could be placed on individuals or groups accusing companies of making misleading environmental claims.
An extract of the APPEA's submission read:
APPEA recommends the Committee broaden the scope of its inquiry to examine the prevalence of false or unsubstantiated accusations of greenwashing...
Also, to examine the impact of these false or unsubstantiated claims, and what legal obligations can be placed on the entities and individuals making these claims so that they can be held accountable to an equivalent standard as businesses.
But Ms Hemming warned this could stop people coming forward.
"If any of this became formalised, people would think twice about suggesting an organisation was greenwashing," she said.
"I don't think APPEA does anything by accident. It's part of a bigger exercise where individuals who are concerned about climate change and the environment are framed as either vexatious or some kind of criminal or terrorist."
In response to questions put to it by the ABC, a spokesperson for APPEA said it had "nothing to add beyond our submission".
Submissions to the greenwashing inquiry from APPEA, as well as the Australian Retailers Association and the Business Council of Australia, said the existing regulatory framework was sufficient, and that enforcement action should be pursued through bodies such as the ACCC alongside education programs.
APPEA also said it would like to see greenwashing defined "consistently with Australian law".
Ms Hemming said she wasn't surprised APPEA would oppose beefing up regulations, given it had been the subject of complaints about misleading advertising in the past.
In 2012, CSIRO claimed APPEA misrepresented its findings in an advertisement about coal seam gas.
A statement on CSIRO's website included:
CSIRO rejects the claim made in a television commercial aired on Sunday 2 September that ‘CSIRO [and government studies] have shown that groundwater is safe with coal seam gas’.
At no time has CSIRO made such a statement, and nor do the results of CSIRO research support such a statement.
CSIRO also said it became aware of that advertisement two days before it was aired and requested it be pulled.
APPEA CEO at the time Rick Wilkinson said APPEA had "taken CSIRO's comments on board" and a spokesperson told the Sydney Morning Herald the ad was approved by the independent advertising regulator.
In a separate incident this year, Australia's advertising regulator Ad Standards found APPEA breached three sections of its environmental code in regards to a gas commercial.
Climate Active
Not all submissions to the senate inquiry are opposed to tougher greenwashing regulation, though.
Former ACCC chairman Alan Fels has called on the inquiry to specifically look into the government-affiliated carbon neutral certification scheme Climate Active.
The scheme has come under fire for certifying companies as carbon neutral for part, but not all, of their operations.
In practice this means companies are able to display carbon neutral certifications, despite having large carbon footprints for activities which they can put outside their certification parameters.
Rob Cawthorne, CEO of for-profit carbon neutral certification body The Carbon Reduction Institute, is one of a number of critics who say the Climate Active exclusions effectively allow polluting companies to "greenwash" their images.
"The exclusions should never exist," Mr Cawthorne said.
"No-one should ever claim carbon neutrality as an organisation without including the desks they use, the furniture they use, or even the professional services — anything they consume."
The Carbon Reduction Institute started in 2006, three years before the first iteration of Climate Active.
Mr Cawthorne said his business only certified companies as carbon neutral if all of their activities amounted to net-zero emissions — it doesn't allow them to exclude parts of their activities from certification.
But he said his company lost business when Climate Active started up, as the government-backed body offered companies an "easier path" to claim carbon neutrality.
"We probably had three or four competitors before Climate Active. Once they came along, we started to lose customers," he said.
"It's absolutely destroyed those people that were trying to do it properly. It's taken all opportunity for us to compete."
He's done his own emissions calculations for several organisations certified as carbon neutral by Climate Active.
He said even under what he saw as the less stringent guidelines of the scheme, some groups including city councils were significantly understating their emissions.
Mr Cawthorne is also in the process of lodging a complaint with the ACCC over National Australia Bank's most recent Climate Active emissions disclosures.
Under the Climate Active scheme, companies publish annual public interest disclosure statements detailing their emissions and how they offset them.
In those statements, companies specify what is inside and outside of their emissions boundary. In other words, what they count and exclude when calculating their carbon neutrality.
But Mr Cawthorne said there appeared to be a bunch of emissions sources in earlier NAB declarations that were neither listed inside or outside their boundary on their most recent Climate Active declaration.
"[NAB] have just gone and removed the important [exclusions]," he said.
"It's a weird thing because we're arguing that exclusions that should never exist have been removed ... [but] the removal of that information doesn't allow anyone to interrogate the claim properly."
A comparison between NAB's 2021-22 and 2020-21 declaration shows a number of activities listed in earlier declarations are absent from the most recent report.
NAB did not respond to specific questions regarding the missing activities.
However, NAB's chief climate officer Jacqueline Fox said via a statement that the bank had achieved annual certification under the program since 2010.
"Our priority is to reduce our operational emissions, before offsetting emissions we are yet to eliminate. NAB's scope 1 & 2 emissions are down ... driven by energy efficiency initiatives and the purchase of renewable energy."
The ABC is not suggesting any wrongdoing by NAB.
The ACCC told the ABC it does not comment on "complaints received and ongoing or potential investigations".
The Department of Climate Change, Energy, the Environment and Water was contacted with questions regarding Climate Active but did not respond by deadline.
The senate inquiry is scheduled to report by June 28, 2024.
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