In the wake of a damning report on companies’ environmental commitments, David Burrows looks at whether such industry targets are helping or hindering matters
Coca-Cola has just pledged to make 25% of its packaging reusable or refillable by 2030 – an “industry-leading” target, it says. Campaigners appear supportive, and yet words of encouragement have in some cases been outweighed by caution and criticism.
Break Free From Plastic, a movement that has ranked the drinks manufacturer the ‘world’s worst plastic polluter’ for four years in a row, hoped others would “follow Coke’s leadership” but highlighted the “string of broken promises” the company has made in recent years. There was the target to include 10% recycled content in every plastic bottle sold in the US by 2005 (missed) and another to achieve 25% recycled content by 2015 (also missed). At the last count, in 2021, Coca-Cola had managed 11.5% recycled content, against a target of 25% by 2025.
Coca-Cola isn’t alone. Several of the largest fast-moving consumer goods companies didn’t achieve ‘zero deforestation’ by 2020, for example, as they pledged a decade earlier. In February, the NewClimate Institute and Carbon Market Watch’s Corporate Climate Responsibility Monitor 2022 report (bit.ly/CCRM_2022) accused 25 leading companies of greenwashing in their net-zero commitments: it states that most failed to put forward ambitious targets, and red-flagged the “accounting tricks” that some firms were using.
It’s not just the private sector that has had target trouble, either. The UK government is continually being hauled over the coals for breaching levels of air pollution. Tree planting targets are a perennial problem, as are those on water quality and waste management. Many departments, including Defra, have missed targets set under the Greening Government Commitments.
This chequered past doesn’t bode well as we enter a decisive decade for the planet. Can we trust companies and the government to deliver on the flood of new environment targets being set?
“People are underestimating how hard some of this is,” says Mike Barry, former director of sustainable business at Marks and Spencer. “This is a multi-decade systemic shift in how we operate the economy, how we operate society and how we consume stuff – all played out against a backdrop of short-term issues.”
And the new environment targets keep coming. Whether it is Coca-Cola’s plan to (potentially) rip up its disposable plastic-based business model or the UK government’s legally binding target to reach net zero by 2050, we have seen an explosion of target-setting in recent times. This is encouraging and concerning in equal measure.
Barry, now an independent consultant, feels the past 10 years have been “dominated” by PR, with companies trying to outdo one another in ambition. This has some merit, creating interest in an issue that can snowball into industry-wide targets and market shifts (were Coca-Cola’s failures of its own doing or because it was left high and dry by competitors that clung to their single-use models?). The zero-deforestation promise made by members of the Consumer Goods Forum, for example, sent a signal to the supply chain, says Barry: “US$3trn of the marketplace said we’ve got a target to shift to sustainable palm oil.”
At COP26, more than 100 leaders promised to end and reverse deforestation by 2030. Signing the declaration is arguably the easy part, though. As professor Chris Hilson from the University of Reading put it in his paper ‘Hitting the target? Analysing the use of climate targets in law’ for the Journal of Environmental Law, targets “can be set by politicians as a crowd-pleasing token, without too much thought or intention on follow-through”. Is this where we are?
“We often see organisations setting some pretty lofty targets around reducing their environmental impact, getting to net zero or even confirming they’ve already reached net zero, which in the cold light of day is quite difficult to believe,” says Charlotte Pumford, head of regenerative impact at footwear brand Vivobarefoot.
What net zero has done is “capture the imagination, because it finally feels like a clear destination,” says Simon Heppner from the Net Zero Now initiative. However, “there needs to be a distinction between global targets that are based on planetary limits and scientific consensus, how these are then interpreted and applied at national level by governments, and finally how they are adopted and implemented by businesses”.
An impossible task?
While the consequences of missing global goals are disastrous, the consequences of a small or medium-sized business missing a net-zero target are far less so. Scrutiny of the targets should therefore place them in context. “Every business that has made a net-zero commitment is part of an unprecedented global experiment without clear roadmaps or guidelines to follow,” Maria Mendiluce, CEO at the We Mean Business Coalition, noted on LinkedIn following the NewClimate Institute’s report.
The report assessed the 25 companies against four areas of action: tracking and disclosure of emissions; setting emission reduction targets; reducing emissions; and climate contributions and offsetting. Only the shipping company Maersk, had “reasonable integrity” overall. Unilever and Nestlé, which have produced more detailed plans than most, were in the bottom five.
Sybrig Smit, one of the report’s authors, sympathised with companies, noting the “inconsistent advice” issued by consultants and standard-setting initiatives. There was mention of the “loopholes” in the process used by the Science-Based Targets Initiative, which has generally been seen as the gold standard for climate commitments but was accused in the report of being a “platform for greenwashing”.
Matthew Germain, head of environment at law firm Osborne Clark, feels that setting targets, working towards them and delivering against them is “becoming an almost impossible task”. He wonders if there needs to be a “little bit of easing off” to let businesses put the processes in place, hire the right people and establish necessary governance systems. “Hold them accountable for not setting ambitious enough targets, rather than delivery of them,” he adds.
Liz Wood, sustainability project leader at compliance scheme and consultancy Comply Direct, thinks people would rather see ambitious targets that companies fail to meet than “greenwashy, loose or weak targets that we know they can easily achieve”.
The firms assessed by the NewClimate Institute and Carbon Market Watch report have committed to emission reductions of just 40% – far below the 90% minimum now thought essential to keep temperature rises below 1.5°C. Some were also selecting years when emissions were “extraordinarily high” as their baselines for reductions, the report’s authors noted.
Whether this was intentional or the result of ignorance is hard to tell, but everyone is on a steep learning curve. The pressure to garner positive press remains, which prompts Wood to wonder if there should be more of a role for marketing specialists with environmental expertise – people who aren’t going to spin targets, but help organisations develop their green ambitions in a way that’s transparent.
Regulators are, of course, promising to clamp down on greenwashing. The new Green Claims Code, developed by the Competition and Markets Authority, talks of “specific and measurable targets and deadlines” to back up claims; net-zero or carbon neutrality targets must also include “accurate information” on the balance between emissions reductions and use of offsetting. None of this is easy, though.
Data and leadership
Data is a point that several experts mention. Consider, for instance, the struggles involved in sifting through supply chains to determine the extent of scope 3 greenhouse gas emissions. Technology is helping in this arena, and the ability to use artificial intelligence and big data to track targets down to the individual product level will define the next decade, says Barry.
With more data comes more detail. Perhaps this plays to Germain’s argument – that companies need time to filter all of this. NGOs and investors have begun to police some of the commitments already, and the more holes they find in the targets, the more pressure there will be for the government to intervene.
The government also has a leadership role in setting and meeting targets.
Who polices the politicians, though?
The Office of Environmental Protection has doubters, but will have the responsibility of ensuring the government is meeting the targets set out in its 25-year Environment Plan. Under the Environment Act, the government has until November to lay new long-term environmental targets before Parliament, covering air quality, water, biodiversity, resource efficiency and waste reduction.
“Targets can be set by politicians as a crowd-pleasing token, without much thought on follow-through”
This will be tough, but there will likely be as much scrutiny on interim targets, which are fast-becoming a tell-tale sign of robust, well-thought targets. They help “avoid slippage and backloading by politicians”, wrote Hilson in his article. This applies to the private sector, too.
Facing up to complexity
“It seems to me that we are entering a period where you can never win, as a corporate with targets,” says Germain. Susan Thomas, senior director for sustainability at Asda, says it’s easy to be overwhelmed by the number of different organisations trying to encourage businesses to sign up to different targets that can be measured in different ways.
“All this is made immeasurably harder by the fact that there still aren’t clearly aligned positions on how we should prioritise, or the inter-relatedness of the issues. Do you want me to reduce the plastic, even if it drives up the waste and potentially the emissions? It’s a minefield,” she adds.
Companies could find themselves on the horns of tricky environmental, social and governance dilemmas in the months to come as the realities of their net-zero targets become clear and they are pushed to make commitments not just on climate, but also on packaging, pollution, biodiversity, chemicals and water.
Support is building for a new UN treaty on plastic pollution, including binding targets for reducing plastic production and waste. “Sometimes the mistake the environmental movement makes is its belief that if everyone signs up to one target, one press release, we’ll go from being unsustainable to sustainable,” says Barry. If only it were that simple.
David Burrows is a freelance writer and researcher.