Environmental law firm ClientEarth has laid down a set of ground rules for corporate net zero pledges, in a bid to ensure the growing number of climate promises being touted by the private sector are effective in their stated aim of reducing real-world emissions and can stand up to accusations of ‘greenwash’.
According to ClientEarth, the fact that companies are committing to climate targets is a good thing. But the strategies they are developing to reach them often fall short. Recently, a Transition Pathways Initiative report found that despite such commitments, none of the world’s biggest oil and gas companies are on track to meet climate goals.
ClientEarth lawyers have therefore developed a principles-based approach that should underpin all Paris-aligned strategies. They must be:
- Reasonable: Paris-aligned targets, assumptions and methodologies must be reasonable, precautionary, evidence-based and regularly updated in line with the best available science;
- Transparent: targets, assumptions, uncertainties, methodologies, performance and impacts must be transparently disclosed; and,
- Accountable: decision-makers must be incentivised and accountable for meeting targets.
Each principle is strengthened by several non-negotiable ‘red lines’, which provide detail on what satisfying these principles requires in practice.
“Businesses and investors are finally setting Paris-alignment and net-zero targets – which is crucially needed,” said ClientEarth lawyer Daniel Wiseman.
He added: “But unless these targets are supported by strategies that are reasonable, transparent and include strong accountability mechanisms, there is a significant risk that stakeholders will be misled.”
“As businesses release details of their climate strategies, they must combine ambition with credibility.
“These principles can help guide firms to develop and implement meaningful net zero strategies. This is in their best interests, and the best interests of all of their stakeholders in addressing systemic climate change risks.
“They can also help us to identify greenwashing and hold firms that are not going far enough to account.”