Not so long ago, the world’s largest corporations were making empty promises to tackle climate change. Even those in the business of selling fossil fuels — such as BP and Shell — have pledged to reduce their emissions. Amazon has named its iconic Seattle sports hub “Climate Pledge Arena,” so neither hockey nor basketball fans can ignore the company’s promise to net zero its emissions by 2040.
But the past year has brought a change of pace, as BP, Amazon and other companies have scaled back some of their targets. Amid this shift, another trend has emerged: Some companies are choosing not to announce their climate goals, a strategy called “green fat.”
“It’s very worrying for us,” said Nadia Kahkkonen, global director of communications at South Pole, a Swiss-based climate consultancy and developer of carbon offsets. “Now is not the time to remain silent about our progress.”
What is “greenhushing”?
The word is a play on “Greenwashing,” a well-established marketing tactic in which companies exaggerate their environmental credentials. Somehow, one led to the other. Governments are cracking down on environmental washing, and the list of lawsuits regarding deceptive environmental marketing is growing. Not surprisingly, some companies have reacted to this new landscape with silence, rather than risk an expensive court case. But staying silent makes it harder to scrutinize what companies are doing, and it also makes it harder for them to learn from each other’s mistakes.
Some people predicted that a crackdown on greenwashing would cause companies to hide their good environmental practices. Before Greenhushing, there was Greenmuting, coined by a former McDonald’s CEO in 2007. “I agree that there are risks associated with environmental marketing, but I actually think that many companies are reluctant to talk about their environmental efforts because they worry that they will only face criticism,” Bob Langert, vice president of sustainability at McDonald’s, wrote in a blog post in response to the “extreme criticism.” Langert argued that this “greening” could hinder environmental progress by stifling public discourse.
Fifteen years later, Langert’s concern seemed justified. Nearly a quarter of large companies from around the world have decided not to announce their milestones in climate action, according to a report from Antarctica last fall. And of course, since the topic was “Greenhushing,” the data was collected anonymously—Antarctica interviewed sustainability experts at companies in 15 different sectors, including information technology, finance, and healthcare. That report led to the popularization of the term “green fat,” which has recently been trending in prominent news outlets including the New York Times and The Washington Post. “We definitely brought it into the mainstream,” said Kahkonen.
A “torrent” of corporate liabilities
The silence isn’t a result of fewer companies setting climate targets. In fact, according to Kähkönen, there was a “flurry” of corporate commitments last year, along with budget increases for sustainability initiatives as companies realized that reaching net zero emissions would be harder than they thought.
More and more countries are drafting regulations aimed at combating greenwashing. Antarctica found that companies based in France, one of the few countries that actually has an explicit regulation limiting greenwashing, were among the least likely to publish their climate targets. “Companies may be unsure of how to comply with this legislation and fear being sued: thus, they give up talking about their goals altogether,” says the report.
In the United States, the Federal Trade Commission has begun the process of updating its “green guides,” the rules governing environmental marketing. Clarifying these guidelines could lead to legal cases against companies that violate them, but lawyers aren’t waiting around for the FTC. In March, a class action lawsuit in California alleged that Delta Air Lines misrepresented itself to customers by claiming to be carbon neutral in advertising, when in fact it relied on incomplete carbon offsets.
That same month, the European Union released a detailed set of rules, called the Green Claims Directive, which aim to curb false propaganda about sustainability. Because each EU member state can meet these requirements in its own way, it creates uncertainty for companies, said Austin Whitman, CEO of Climate Neutral, a nonprofit organization that evaluates and certifies climate pledges.
“We really, really, really need a lot of disclosure about all the environmental actions that companies are taking, we want to disclose it regularly and transparently, we want to disclose it quantitatively,” Whitman said. And companies need to feel they can disclose in a way that won’t be counterproductive. He called on the US Securities and Exchange Commission to expedite the development of a framework that compels companies to disclose emissions data in a standardized manner.
Another factor could be the result of the Republican backlash against “awakened investing.” A recent report from the Washington Post said that investment giants like BlackRock and Vanguard have removed references to their climate goals on their websites over the past year. But Whitman sees the drama about green investing mostly separate from corporate sustainability. “I don’t see it affecting consumer brands as directly as it affects asset managers,” he said.
Whatever the reasons for the fraud, it’s not all bad news. Whitman said companies that have been bashing everyone with misinformation about climate progress have reason to finally stop. “They should be concerned about litigation, regulation, and consumer pressure, and they should be silent about that.”
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