Big business is heeding the call of climate scientists and pledging to spew fewer planet-warming emissions into the atmosphere. But many companies aren’t acting quickly enough or setting tough enough targets, according to a new study.
Companies are only 31 percent of the way to reducing their greenhouse gas emissions to the levels needed to stave off some of the worst effects of a warming climate, according to the study published Monday night.
The report from environmental nonprofit CDP, which works on behalf of more than 800 investors, is the world’s largest annual tracker of company responses to climate change.
Its release comes just before the second anniversary of the Paris Agreement, in which 195 countries pledged to reduce carbon emissions, giving a clear signal to the private sector that it could play an important role in helping countries achieve their goals.
CDP (formerly the Carbon Disclosure Project) picked a sample of more than 1,800 of the biggest, highest-emitting companies from different sectors and across different countries, including car maker Nissan and consumer goods company Unilever, owner of the brands Ben & Jerry’s and Dove. Combined, these 1,800 companies are responsible for 12 percent of global greenhouse gas emissions.
From the 1,073 companies that responded, 89 percent have set emission targets (up from 86 percent in 2016). However, only 14 percent have adopted “science-based targets.” These are more ambitious, long-term targets aligned with climate scientists’ recommendations to keep warming below 2 degrees Celsius above pre-industrial levels. With a greater temperature increase, we risk catastrophic climate change, including rising sea levels and droughts.
“The majority of responding companies have yet to commit to emissions reduction goals that are equal to the climate threat we face,” noted the report. As a result, companies are less than a third of the way towards where they need to be to meet Paris climate goals.
Paul Simpson, CEO of CDP, said, “We strongly urge [companies] to follow through and align their goals with climate science to ensure their resilience in the transition to a well-below-2-degree world.”
Then there are the 40 percent of companies contacted by CDP that failed to disclose anything at all. “Yes, it’s disappointing,” said Marcus Norton, chief partnerships officer and general counsel at CDP. “We need transparency from them.”
But Norton said there were reasons to be positive. He noted that more than 300 companies have said they will set science-based targets within the next two years.
And more than a third of companies (36 percent) are offering low-carbon products, such as electric vehicles and zero-energy buildings, the report notes. Renewables are a big part of companies’ efforts on climate change, with 19 percent setting a target on use of renewables. Companies such as Britain’s BT Group and Unilever have committed to using 100 percent renewable energy by 2030.
Norton said he was particularly pleased with the 32 percent of companies setting an internal carbon price. “With COP23 coming up in Bonn,” he said, referring to the annual meeting of the U.N. climate change convention, “the action of non-state actors can be quite pivotal in giving national governments the comfort they need to be ambitious.”
However, critics say, in our current economic system, businesses’ pace of change will never be enough. “Business corporations rely inherently on short-term, profit-maximizing activities, which assume ongoing economic growth,” said organizational studies professor Christopher Wright of Sydney University Business School in Australia.
“We need to imagine a future that goes beyond the comfortable assumptions of corporate self-regulation and ‘market solutions.’ In an era in which neoliberalism still dominates political imaginations around the world, the folly of over-dependence on corporations and markets in addressing climate change is an ‘inconvenient truth’ for our political and economic leaders.”
CDP also published a scorecard Monday for companies’ performance on climate change, water and forests. The “A List” is a result of a survey of 6,000 of the world’s biggest companies. Of the nearly 2,500 that responded, 160 were awarded an A grade in at least one area. Unilever and L’Oreal were the biggest winners, scoring A’s across the board.
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