In February 2024, three major investment companies stepped back from efforts to limit climate-damaging emissions. JPMorgan Chase’s and State Street’s investment arms have both quit a global investor alliance encouraging companies to avoid emissions, and BlackRock has largely limited its involvement.
These companies aren’t the only ones backing out on climate agreements. In 2023, Amazon dropped an effort to zero out emissions of half its shipments by 2030, BP scaled back on its plan to reduce emissions by 35 percent by the end of 2030 and Shell Oil dropped an initiative to build a pipeline of carbon credits and other carbon-absorbing projects. There are hundreds of companies across the world backtracking on commitments toward green policies, despite growing concerns that the planet is reaching a crisis point.
The lack of government policy surrounding corporate emissions makes it easy for companies to abandon their promises. Net Zero Tracker, a group that monitors progress on corporate and government climate pledges, examined more than 1,000 companies that have made pledges to zero out their emissions by 2050. The group found that less than 4 percent of the 1,000 companies were doing the bare minimum to be considered in line with the goals of the 2015 Paris agreement. The rest of the companies were not even meeting the so-called “starting line criteria” laid out by the United Nations. The “starting line” calls for companies to track their carbon footprint across supply chains, cut emissions, create a plan for using carbon offsets, and have annual reports on meeting climate targets.
It’s obvious that letting companies make their own policies regarding greenhouse gas emissions is not effective. More government issued policies are crucial to making a real dent in carbon emissions. One recently-passed law in the U.S. is the Inflation Reduction Act, provides hundreds of billions of dollars in tax subsidies to companies using wind and solar power, electric vehicles, or other carbon capture technologies. The idea is that by making it cheaper to go green, companies will find polluting a less attractive option.
Another method of corporate accountability is carbon pricing, which is putting a blanket tax on each ton of greenhouse gasses emitted by a company. Then there’s the oldest, most reliable method of accountability, mass protest. There are many climate action groups like Mission Possible Partnership or First Movers Coalition, that are looking to force companies to cut emissions. Most companies originally claimed to implement green policies to appeal to public interest. If the public continues to thoroughly and unrelentingly push the matter, companies will be forced to truly administrate green policies. [GWL]