Avoiding greenwash – beyond net zero targets
Recent years have seen a proliferation of net zero targets being set by corporates. In the global food and drink industry alone, as of April 2023 nearly 500 companies have engaged with the Science-Based Targets initiative (SBTi), which validates targets to its Net Zero Corporate Standard. Over 100 of them are UK registered companies, including several supermarkets. Others have set similar targets, using different language such as ‘carbon neutral’ or using their own interpretation of net zero.
Customers and other stakeholders often wish to understand what lies behind the targets and how they will be achieved. When companies struggle to articulate that clearly, accusations of greenwash soon follow. So, what gives confidence that a company is on top of its net zero agenda?
In our opinion, confidence starts with how the target is set in the first place, combined with adequate coverage of net zero in corporate reporting. Four points to consider when setting a robust target are to:
- Understand the definition of net zero.
- Have a good quality carbon footprint.
- Undertake pathway analysis to map out a high-level road map for decarbonisation.
- Either seek SBTi validation or demonstrate alignment with science-based reduction pathways.
When it comes to reporting, most companies are having to do some form of statutory carbon reporting already, for example in response to the UK’s Streamline Energy and Carbon Report (SECR) requirements. However, a ‘compliance only’ approach is unlikely to adequately answer the questions stakeholders will have on how becoming a net zero company is to be achieved.
The forthcoming requirement for UK-registered quoted and large companies to publish net zero Transition Plans is designed to fill this gap in corporate disclosures. HM Treasury launched the Transition Plan Taskforce (TPT) in April 2022, to develop the ‘gold standard’ for transition plans and draft guidance was published at the end of 2022, with an expectation of being completed later this year. Smaller companies will find this useful too, as a framework to help think through what net zero means for them, and how to communicate that in a way that avoids greenwashing traps.
Webinar hosted by The Grocer: Bullet proof net zero targets for your business
We have explored this topic further and presented a webinar hosted by The Grocer. You can find out more and watch a recording of the webinar here:
Net zero targets service.
Proactively manage your transition to net zero and avoid regulatory, market and reputational risk.
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