Normative.io are one of the leading climate action enterprises: giving tools and advice to businesses across the world on how to reduce and accurately measure their CO2 emissions (misleading information that is commonly known as 'greenwashing'). In recent times, the effects of greenhouse gases on the climate have been impossible to ignore. It is more important now than ever before that the information and data processed by each individual business is accurate. By working directly with the UN and key policymakers, Normative has played a crucial role in steering the global climate agenda.
According to Normative, 48% of the world’s company websites promote false or misleading information - whether it be intentional or not, the dangers are very real. Many organisations create an illusion wherein their ‘actions’ follow in line with societal expectations of environmental action; however, action speaks louder than words. It turns out that a significant amount of these corporations cannot support their claims that they are reducing their emissions or attempting to transition to Net Zero target commitments.
If you take the Volkswagen emissions cheating scandal for example, which caused huge damage to their reputation, as well as drastic financial repercussions. Fast forward five years later and their stock shares are still at record lows.
The impact and snowball effects of Greenwashing
From financial and legal failure, to damaging public reputations, the dangers of greenwashing have real and long-lasting effects.
BNY Mellon were fined $1.5 million for promoting its ESG statements - which were found to be completely inaccurate and notably false.
There are clear incentives for environmentally friendly business practices.
It has even been recorded that 66% of people are more likely to choose a company with strong environmental policies than not. So why is greenwashing still so apparent?
The nature of greenwashing is often spoken about by activists and NGOs as negative and reflective of the organisation's poor ability to alter their practices in line with sustainable practices.
However, much of the greenwashing seen today is unintentional.
Explained to people as ‘traps’, greenwashing can be broken down into
5 key aspects:
- Setting inadequate targets
- Ignoring what you cannot see
- Low-quality data
- Lack of transparency
- Ineffective carbon offsets
The 5 common traps: Explained
Traps 1 and 2 can best be explained concurrently and put simply as emissions from fuel combustion. This is only a small portion of a company’s carbon footprint.
The majority is made up in Trap 3, which includes 15 different categories. Only after all categories are screened can organisations know where their biggest emissions come from. Trap 3, officially known as low-quality data, concerns the yielding of precise results.
There are two main differences in the data gathered by an organisation. Activity data is, for example, the number of litres instead of the amount of money spent on fuel. Another good example of producing more accurate data is collecting energy usage as KwH instead of money spent on purchasing energy.
A combination of spending and activity data is key to staying on track with the latest scientific data findings. Ensuring the use of up-to-date emission factors from trusted scientific sources is paramount.
Trap 4 is a lack of transparency. Instead of highlighting the obvious here – it is perhaps more useful to state what is necessary to increase transparency.
- Annual disclosures of emissions – stating clearing what legal entities or business units are included in the calculations and providing a breakdown of emission sources e.g. subcategories in Trap 3.
- It is crucial that stakeholders know what aspects (if not all) have been covered in the report.
- Information released on methodology, process, what is inside (or outside) the scope - the approach used, and why the details matter.
- The more information the better.
Trap 5 is a low-quality carbon offset. 85% of offsets in the UN’s clean development mechanism failed to reduce emissions. It is important to note that “avoided emissions” are different from carbon removals.
Examples of effective removal projects – like biochar, peatland restoration, and direct air capture.
Improper screening and moving goalposts of emissions legislation make Trap 5 very hard to navigate and understand.
It is easily the most complex Trap and warrants its own blog post. The main reason behind this is that the database recommendations differ greatly everywhere you look.
The information needed to reduce carbon impact cannot be found in one URL or one database. There are free tools and resources for industry averages however the connection of multiple databases is by far the greatest way that a company can accurately measure its carbon footprint and therefore begin to explore ways to reduce and capture the carbon offset.
Click here to find out how you may be able to reduce your CO2 emissions and record your organisation's environmental impact accurately:
