CLEW focus: 'Climate neutral' products and companies - Greenwashing or sign of serious action?

The European Commission has proposed a set of detailed rules for companies to back up their green claims on products, ranging from “carbon-neutral” sunscreen to “biodegradable” plastic packaging. The proposal for a directive on green claims has the potential to make a difference by reducing the number of green claims, making them more specific, and obliging companies to provide more information to consumers. It could make greenwashing a lot harder while highlighting companies which actually achieve real change. However, NGOs criticise that the initial proposal is “far from the real (green) deal”. This Q&A answers key questions on the legislative proposals and the next steps in the legislative process. Read it here.

The world’s top management consultancies, who for decades have advised the biggest polluters, are now piling into the business of helping companies cut emissions to become more sustainable. They are retraining staff, poaching environmental experts, and buying up smaller specialist firms as they seek to generate fat fees from the corporate shift towards a net zero future. Many NGOs, and even some consultancy insiders, question whether the big advisory firms can really be part of the solution to the climate crisis as long as their primary focus remains on finding ways to maximise clients’ profits and efficiency. Consultants also continue to help fossil fuel clients prop up their businesses and lobby against regulations, while making them and other industries appear greener than they really are. But the advisors, and their clients, are increasingly aware that greenwashing accusations pose a major reputational risk. Read the report here.

The spread of corporate net zero targets is starting to make itself felt across the world – not only among businesses, but also far beyond. An increasing number of companies have started to scan - and then reduce - the climate impact of their international supply chains, sending ripple effects across continents. Clean Energy Wire presents a series of international case studies on the far-reaching impact of net zero targets - ranging from Taiwan's beleaguered chip industry to the offset gold rush in Mexico's forests, and from supposedly climate-neutral Netflix to India's heavy industry. Find the collection here.

It remains virtually impossible to make truly "climate neutral" products in a modern economy, despite the rapid increase of such labels, says Susanne Spies of Germany's Federal Environment Agency (UBA). Entirely eliminating the climate impact of products and services still poses huge challenges, the researcher for ecologic design and environmental labeling told Clean Energy Wire in this interview. She explains why clear definitions are urgently needed to make neutrality claims effective, where states and companies differ when counting emissions, and why even growing your own vegetables is not necessarily climate neutral.

Boasting about “climate neutral” products or vague plans to become “net zero” is turning into a legal risk for companies, as activists drag firms into courts over deceiving consumers with questionable climate pledges. A raft of landmark climate “greenwashing” cases based on consumer law are about to be heard by judges in several countries. While activists hope that courts will take a hard line on companies, others warn that the cases could backfire, and even delay company climate action. The immediate impact of the rulings might not equal famous climate cases against governments based on human rights, but they are set to shape the future of company climate communication, and the role consumers play in the fight against climate change, experts say. Read the article here.

The spread of unregulated company publicity involving “net zero” or “climate neutral” claims has become a systemic barrier to achieving climate targets, argues ClientEarth, an NGO focussing on using laws to advance environmental protection. “Advertising has developed into this big inhibitor of actual climate action,” says their lawyer Jonathan White, a specialist in climate accountability. In this interview with Clean Energy Wire, White explains the prospects for using consumer law as a way of tackling companies on their climate claims, how the EU will fight greenwashing in its pending update of consumer protection laws, and why ClientEarth is calling for an outright ban on advertising by fossil fuel companies.

Having a "net zero" target or launching a "climate neutral" product is the new normal for companies. But these claims are difficult to verify, and mostly don't add up when checked carefully. In the worst cases, they are pure greenwashing – misleading consumers and investors by hiding continued emissions. Evaluating corporate climate claims requires venturing into complex greenhouse gas accounting, and cutting through confusing jargon. This factsheet explains the basics for making sense of different types of climate pledges, deciding which emissions count, and the trouble with making climate sins disappear by paying others to do the emission cuts via carbon offsets.

Current "climate neutral" product claims may be flawed, but they are a clear sign that companies realise that consumers want climate action, argues Jens Burchardt, the Boston Consulting Group's global expert on climate impact. "I think most companies have still not understood that this is an enormous opportunity," he explains in this interview. Pioneering companies still have the chance to present the world's first genuinely climate neutral products - based on emission cuts throughout supply chains instead of questionable carbon offsets. The first of these are likely to appear in the second half of this decade, but stringent regulation on "climate neutral" claims will be necessary to protect the frontrunners, says Burchardt, who has advised many companies on their net-zero efforts.