Dozens of world’s largest firms not delivering on climate pledges and making ‘misleading’ claims, report finds

Some of the world’s largest companies have climate plans of “low” or “very low integrity”, and are making “misleading” claims about their action to combat global warming, according to a report.

Firms such as Samsung, Amazon, Nestlé and PepsiCo, are among those on course to miss their own climate targets and have been accused of creating “greenwashing” campaigns which are designed to make the company look environmentally-friendly, rather than actually minimising its impact.

Fifteen companies were rated low or very low integrity with only the shipping company Maersk judged to have a climate plan with “reasonable integrity” -  none of the firms achieved a high integrity rating.

Lindsay Otis, of Carbon Market Watch, who worked on the report, said these firms are “exposing themselves to increasing legal and reputational liability”

The Corporate Climate Responsibility Monitor, released by the non-governmental organisation Carbon Market Watch, assesses the climate strategies of 24 major global companies, analysing the extent of their corporate climate leadership.

The companies all have links to the Race to Zero campaign so they have all committed to reducing the amount of carbon emitted in line with what scientists calculate is needed to limit warming to 1.5C above pre-industrial levels.

To meet the 1.5C target, carbon emissions reductions of more than 40% would be needed by 2030, the report says. But it estimated the average reduction between 2019 and 2030 is between 15% and 21%.

At least 18 of the companies have said they plan to rely “heavily” on offsetting their emissions by planting trees and through similar projects to remove carbon from the atmosphere.

However the report said this is problematic as trees do not lock away carbon for long enough and there is not enough room on the planet for targets to be met in this way.

It also said that companies are often not counting all “scope 3” emissions, including carbon produced by their suppliers, the transport companies they use and the companies that deal with their waste.

Which firms had low ratings?

The report found half of the companies assessed made some form of carbon neutrality claim in 2021 and 2022 - but the integrity of every one of those claims was poor.

Ms Otis said: “By making such outlandish carbon neutrality claims, these corporations are not only misleading consumers and investors, but they are also exposing themselves to increasing legal and reputational liability. Instead, they should implement ambitious climate plans to reduce their own emissions, while financing action outside of their own activities, without claiming that this makes them carbon neutral.”

Thomas Day, of New Climate Institute, in Germany, said: “In this critical decade for climate action, companies’ current plans do not reflect the necessary urgency for emission reductions.”

Low integrity firms

• Ahold Delhaize (Dutch retail company)
• Amazon 
• Deutsche Post (German post company)
• Fast Retailing (Japanese retail company owning brands such as Uniqlo)
• Foxconn (Electronics industry company)
• Inditex (Spanish clothing company)
• Mercedes-Benz
• Nestlé
• PepsiCo
• Volkswagen
• Walmart

Amazon pledged to reach net zero by 2040 but the report found that when all the emissions linked to the company are counted, it is on course for a 16% reduction, at most, by 2030.

An Amazon spokesperson told The Times: “We’re actively working to reduce emissions to reach net zero carbon by 2040 ... Some actions will have immediate carbon savings, while others will take years to demonstrate results — and we will continue to invest in both proven and new science-backed solutions to help solve this crisis.”

Nestlé set a 50% reduction plan for carbon emissions by 2030, but the report calculated that its plan will cut its full emissions footprint by 16-21 per cent.

A Nestlé spokesman said the company did not agree with the analysis. He said “Our primary focus is on reducing emissions as much as we can across our operations and supply chain. We have made significant progress, leaving peak carbon emissions behind us in 2019.”

Very low integrity firms

• American Airlines 
• Carrefour (French retail company)
• JBS (Largest meat processing company in the world)
• Samsung Electronics

Which firm had high ratings?

Moderate integrity firms

• Apple
• ArcelorMittal (Steel manufacturing firm)
• Google
• H&M Group
• Holcim (Global building materials flagship)
• Microsoft
• Stellantis (Automobile corporation)
• Thyssenkrupp (German engineering company)

Reasonable integrity firms

• Maersk (integrated logistics company)

Five out of the 24 companies committed to decarbonise their emissions by at least around 90% by their respective net-zero target years.

These companies were: H&M Group, Holcim, Stellantis, Maersk, and Thyssenkrupp.

H&M Group and Holcim have had their netzero pledges certified - and the report found the net-zero pledges of these companies were of high and moderate integrity.

Twenty of the companies state that they invest in new solutions for zero-carbon technologies. But the report identified only a handful of companies that are working on technologies that address key emission sources.

For example, Maersk, invests in alternative fuels and vessels, Google, has 24/7 monitoring and matches renewable energy generation with consumption, and Deutsche Post, invests in electrifying its fleet.

Samsung, Mercedes-Benz and PepsiCo have been contacted for comment.