Want Consumers to Make Smart Climate Choices? Stop Greenwashing

A sign stands illuminated in the plenary hall at the UNFCCC COP27 climate conference on November 07, 2022 in Sharm El Sheikh, Egypt. The conference is bringing together political leaders and representatives from 190 countries to discuss climate-related topics including climate change adaptation, climate finance, decarbonisation, agriculture and biodiversity. The conference is running from November 6-18. Credit - Sean Gallup-Getty Images

Flip through the pages of a business magazine or walk through an airport or train station and you’re likely to be bombarded with advertising from companies claiming to have gone green. Go to a grocery store and you’ll see everything from laundry detergent to yoghurt claiming to be net zero.

According to a recent report, already more than 90 percent of the world’s economic output and over 80 percent of global emissions are covered by net zero pledges. These pledges are supposed to signal that companies are tackling climate change by reducing their greenhouse gas emissions and deserve your business.

Unfortunately, we know this isn’t always the case. While there are many great examples of companies working to transform how they do business, in reality, too many of these climate pledges represent little more than empty slogans and hype.

Consumers are increasingly skeptical. Earlier this month, an Edelman report on trust and climate change which surveyed 14,000 people covering 14 countries, confirmed that business lags badly when it comes to people’s perception of their green credentials. Nearly two-thirds of respondents believe companies are mediocre or worse at delivering their climate commitments and fewer than half of people trust CEOs to tell the truth about climate change, much less what needs to be done to address it. By contrast, three-quarters of people say they trust scientists and climate experts to provide accurate information.

This is why the United Nations Secretary-General António Guterres decided to blow the whistle and call on corporations to start walking the talk on their net-zero promises—which would require immediate action to cut greenhouse gas emissions as close to zero as possible.

Right now the world is not on track to limit global warming to 1.5 C degrees which is necessary to avoid the most devastating effects of climate change. To keep this goal alive, we need to reduce global greenhouse gas emissions by at least 45% by 2030. But right now, those emissions are projected to rise by more than 10%. In describing this crisis, the Secretary-General is clear: “We cannot afford slow movers, fake movers or any form of greenwashing.”

But why is greenwashing so bad? In part because the stakes are so high. It’s not just false advertising: Bogus net zero claims drive up the cost that ultimately everyone will have to pay in order to stop climate change. Greenwashing also fuels public cynicism about climate issues and undermines one of the few mechanisms we have to coordinate global action.

To restore integrity to net zero pledges by businesses, financial institutions, cities and regions, the Secretary-General established a global task force of 17 experts to look closely at the standards, definitions and criteria surrounding them. His belief and mine is that net zero is too valuable a tool to lose to cheap marketing. We need these commitments to translate into real action. Our job was to draft clear criteria and standards that bring transparency, ambition and credibility to net zero.

Our report, called “Integrity Matters” sets out what it means to make a net zero commitment. For consumers, it means that a vote cast with your pocketbook will make a difference.

When implemented, the criteria establish clarity about what does and doesn’t count towards a net zero goal — as well as what is plainly disqualifying.

This means that when you see a net zero logo on a product in a store or see an advertisement touting a net zero pledge, you can know that the company is taking real and immediate action to reduce almost all of its greenhouse gas emissions from the atmosphere in line with the science and that it will “offset” the remaining emissions with permanent removals.

A mother buying clothes for her kids will be able to know if a company is working with suppliers to reduce emissions. A retiree will know if his pension plan is funding new fossil fuel development or investing in clean energy. A young person will know if her employer’s overall emissions are going down now or if they instead buy cheap low quality emissions credits to offset business as usual. An investor will know if a company is making climate pledges in public while lobbying against climate regulations in private and whether executive compensation at that company has been linked to meeting corporate climate goals.

These are just a few practical examples of how real net zero will reduce confusion and make every pledge count. After all, the job is to cut emissions, not corners.

We also want companies to publicly and transparently disclose real progress they are or aren’t making to reduce their emissions. Work is underway to develop a credible, comprehensive public online database that consumers, investors and the public can check to see the progress a company is or isn’t making to reduce its emissions. It will now be possible to reward those leading the way with good housekeeping seals for climate action from authoritative, independent sources—this makes good climate choices a lot easier.

As Canada’s Minister of Environment and Climate Change, I saw the power of businesses, financial institutions, cities and regions to help accelerate positive change. Canada succeeded in putting a price on carbon pollution across the country by building on the initiatives of several provinces. Major Canadian companies across a wide range of sectors publicly supported the need to ensure it was no longer free to pollute. Precedent, advocacy and leadership created an ‘ambition loop’ that became even more powerful when governments and non-state actors worked together.

Today, we need an ambition loop for net zero—one that accelerates the pace of global change.

Consumers can help drive this ambition but only if they’re able to exercise their purchasing power and distinguish between climate leaders and laggards which is why this work is so important. Of course, voluntary standards will only take us only so far. Governments need to regulate compliance to level the playing field and get all companies on board.

I believe high-integrity climate action will prove to be one of the major generational trends that shape today’s markets. Young people will demand that prospective employers demonstrate a real commitment to climate transparency. Consumers will look to buy from companies that they know are taking credible climate action. Clients will demand it from their banks, pension managers and insurers. By putting an end to greenwashing we can empower consumers everywhere to do the same. With a clear goal: Ensuring a sustainable planet for our kids and grandkids.

McKenna is the Chair of the United Nations’ High‐level Expert Group on the Net Zero Emissions Commitments of Non-State Entities. Their report, Integrity Matters, was released today at COP27 in Egypt.