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July 30, 2021

How to spot greenwashing

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Kira Hood

As the impact businesses impose on the environment becomes salient, more organisations are turning to carbon neutral or net zero commitments as a strategy to reduce and mitigate their climate impact. As this industry grows, how can we cut through the glass and separate the honest and auditable commitments from the greenwash? How can you ensure that your business is undergoing a credible process and is attaining quality accreditation that steers far from the greenwash?

In this article, we aim to answer all these questions and provide you with the insights you need to identify greenwashing and ensure your organisation is participating in climate actions that are credible, and auditable.

But first, what is greenwashing? 

Greenwashing is conveying a false impression or providing misleading information about a company's true environmental impact or status. 

Greenwashing parallels the term “whitewashing” and deems to use misleading information as a ploy to cover bad behaviour or promote false actions. 

Greenwashing within the carbon industry

For each carbon goal that an organisation may wish to meet, whether it be carbon disclosure, carbon neutral certification or commitments to net zero emissions, there are a series of steps that must be completed before any status can be attained. 

To ensure these steps are completed with integrity and credibility, governing bodies and industry frameworks have integrated themselves within the industry to implement and enforce standards and regulations. Common examples include;

  • GHG Protocol which 'establishes comprehensive global standardised frameworks to measure and manage greenhouse gas emissions;
  • Climate Active, an Australian Government-run initiative that provides carbon neutral accreditation against its rigid standard;
  • Carbon Disclosure Project,  a not-for-profit that runs a global carbon disclosure system. 

When an organisation fails to meet the regulations and standards set by the industry bodies that influence the credibility of a particular carbon goal or status, any claim or promotional activity they make surrounding their carbon impact or carbon status is classified as greenwashing. 

Greenwashing and carbon emissions measurement

Carbon management, carbon neutrality and net zero all have required processes that stem from the reliable and accurate entry of an organisation’s activity data. Entering the relevant activity data revolves largely around the carbon emission calculation tool or process used. It is important to use a complete carbon emissions calculator that measures scope 1, scope 2 and scope 3 emissions, is compliant with a recognised standard (e.g. GHG protocol) and uses the latest published government or industry emission factors.

Without complying with the above, the carbon footprint (measured in tonnes of carbon dioxide equivalent) may not be a true representation of the organisation's emission sources and their overall carbon impact. In response, any action which is undertaken based on this figure, for example, identifying emission reduction opportunities, producing a carbon report, or understanding the amount to offset so to achieve carbon neutrality, is based on inaccurate data and is, therefore, contributing to greenwashing.  

Greenwashing and net zero targets

Net zero commitments represent a long term commitment that combines the approach for an entity to both reduce and then remove carbon emissions. Under a net zero scenario, emissions are still being emitted but an equal amount of carbon is being removed from the atmosphere. Click here to learn more. 

Luba Nikulina, global head of research at Willis Towers Watson stated in an interview with Amanda White from top1000funds, "If you think about the net zero commitments, they are statements of intent ... we need to unpack the statements and see what their beliefs are and how that translates into action". 

When we look at organisations net zero commitments, the following questions need to be asked:

  • What organisational changes and plans of action have been put in place within the business to ensure that the net zero target will be achieved? 
  • What proof of action, for example; a clear outline of the organisation's reduction initiatives, the planned roadmap to net zero emissions, or a carbon report, is available for stakeholders to view and continue to view as the organisation works towards reaching net zero emissions?
  • Is the organisations' reduction strategy target truly the quickest and most feasible for the business? Is the business capable of cutting more of their emissions and faster, and if so, why have they chosen a weaker target?

If an organisation fails to successfully meet or acknowledge any of the above questions, the real question to be asked is, is the company net zero target of true intent or is it a strategy to comply with market-based climate demands? 

Science Based Targets (SBT) is a leading organisation that is supporting the transition to net zero. Organisations are able to set targets, backed by science, and develop strategies to achieve net zero by a reasonable timeframe. By using the methodology developed by SBT, your organisation is demonstrating a commitment to achieving net zero within a feasible timeframe.

Why is greenwashing so easy to come across in the carbon industry and what to look out for

The carbon industry is a terrain that hasn't been or is just beginning to be, crossed by many organisations. Due to this, few organisations know and understand the various regulatory standards and frameworks that exist in the industry. 

It is important that when an organisation chooses a provider to support any of its carbon management goals, that the provider has mandatory processes and standards set in place. This ensures the credibility of the organisation's inventory and carbon claims. 

To help you avoid greenwashing, here are some common things to look out for before starting your carbon journey:

  • GHG Protocol compliant measurement: Look out for a carbon emissions measurement provider that is compliant with GHG Protocol for carbon measurement and reporting. To learn about GHG Protocol, click here.
  • There is a required certification process: To receive a reputable accreditation or meet a specific carbon objective, it is important to ensure the provider enables this, has a set of rigid and non-negotiation processes and requirements. These requirements should comply with many of the common industry frameworks and standards. Pathzero ensures this, click here to learn more.  
  • They have a validation and verification process: Emissions inventories need to be checked by consultants who are familiar with greenhouse gas emissions management. This ensures that your inventory is credible, accurate, and includes all relevant emission sources.
  • Processes are backed by a protocol: Particularly for certification, it is important to make sure your accreditation is backed against a protocol. However, even if your organisation is choosing to meet less stringent carbon objectives, like just measuring its emissions, choosing a platform or service provider that has a protocol is still important and a good indicator of (doing things properly). Pathzero is backed by our Protocol and is compliant with the GHG Protocol, this allows organisations to credibly achieve a wide range of sustainability goals and objectives, including, carbon measurement, reduction strategies, carbon reporting and disclosure, and carbon neutral certification. 
How to spot greenwashing

Greenwashing can find itself in many forms, but the fundamental component to look out for is transparency. Transparency into the audit trail of an organisations emissions measurement, including their emissions boundary and the emissions factors used is key. This showcases the steps undertaken and the data entered by the organisation to compute the represented figure. Another quality factor to determine whether greenwashing has occurred or not is whether the organisation's carbon emissions calculation has been checked and signed-offed by a registered consultant.

Below are some additional things to look out for to help you spot greenwashing:

  1. Measurement: If a carbon measurement can not be traced back to a credible carbon emissions calculation method and process. The calculation needs to have a valid emissions boundary, include all relevant scope 1, 2 and 3 emissions, use actual data for measurements where possible and use government published or industry-accepted emission factors. 
  2. Reduction: When an organisation is carbon neutral certified or is working in alignment with a net zero commitment and hasn't identified its largest emission sources and has not set or started executing on reduction initiatives. 
  3. Offsetting: The organisation has not chosen a recognised verified carbon offset credit to offset the residual emissions of the organisation. Verified carbon offset credits are credible, regulated and available through recognised registries (learn more). This is a requirement for a credible carbon neutral certification or net zero claims. 
  4. Reporting: The organisation is reporting on a carbon footprint that can not be traced back to a credible measurement. Any statements within the report (amount of tonnes CO2-e within each scope, highest emission sources, reduction initiatives etc.) is based on an inaccurate or untraceable measurement. 
  5. Carbon Neutral Certification: If an organisation claims to be carbon neutral certified but the certification is not backed by a protocol, or the accreditation provider is not credible and doesn't adhere to industry requirements. 
  6. Net Zero commitments: The organisation fails to provide sufficient transparency on their net zero commitments and their actions to achieve the commitment or if the target is vague and does not have a reasonable timeline to achieve the commitment. 
How Pathzero helps you avoid greenwashing

As previously mentioned, greenwashing can easily be an unintentional mistake made by many organisations which are not fully aware of what regulatory guidelines and standards they must to adhere too. Pathzero acknowledges this and has worked to ensure that our protocol and all the steps within our application enforce best practice, and provide all the necessary tools and resources needed to adequately complete the required measures. Our registered consultants, also available within the app, are there to help fill any knowledge gaps and ensure that the actions taken to meet your carbon objective and promote your carbon status are accurate, auditable and credible. 

The Pathzero blog is filled with a library of useful blog posts that aim to educate on the various aspects of carbon management. If you are curious about a particular process within carbon management or carbon neutral certification, head over to our blog page to find a relevant article; or for more specific insights, head to our Question Time submission page, an open resource where you can ask our sustainability experts any carbon or sustainability question you have. 

If you are interested to learn more about Pathzero and want to get started on your carbon journey, schedule a demo with our friendly team.

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