What is the greenwashing trick?
Rather than using past emissions levels as a baseline for reducing their emissions, some meat and dairy companies set climate targets using a “business as usual” projection of the future. These projections aren’t real emissions and real numbers – they are potential future scenarios.
To be meaningful and measurable, emissions reduction goals must be grounded in a “baseline” amount, against which progress can be measured. Typically, countries and companies choose a baseline year to compare their emissions to as they work to reduce greenhouse gas pollution. Take the EU’s climate target, for example: reduce emissions 55% by 2030, compared to EU emissions in 1990 (the baseline).
Using a baseline allows actual emissions reductions to be monitored easily by comparing current levels of emissions to past levels.
However, companies are using a future baseline – a clever accounting trick – to project how much they would pollute in ten or 15 years using their existing practices, then working backwards.
This greenwashing strategy enables companies to claim that they have more ambitious climate targets than they actually do. In reality, the true measure of their climate ambition should be how much they have effectively cut greenhouse gas emissions when compared to the amount they emitted in the past.
How is this greenwashing trick used?
Companies use business as usual (BAU) future scenarios as their baseline, rather than using their past emissions as a baseline against which they measure progress.
This accounting trick allows companies to claim far greater emissions cuts than they actually make.
BAU is a calculated projection meant to reflect how much a company’s emissions would increase if the company operated in the absence of any climate action. Because BAU is just a projection, companies can inflate what their emissions might be in a hypothetical, future scenario where no action has been taken to reduce emissions. This creates an artificially high baseline, which allows a company to make moderate cuts to their actual emissions today, while claiming major reductions when measured against the imagined high emissions BAU future.
This trick is also known as “creating hot air”, because the inflated baseline provides a sizable cushion for companies to continue increasing their emissions or only moderately reduce them compared to past levels. As long as a company remains below their inflated future baseline, they can claim to have taken action against climate change.
Why is this bad for the climate crisis?
The latest climate science from the UN predicts that global emissions must peak by 2025 and be reduced 43% by 2030 (below 2019 levels) to limit global warming to 1.5C. Accounting tricks that create climate targets based on inflated future emissions help companies evade urgently needed rapid emissions reductions and mislead the public to believe that companies have ambitious climate targets.
Instead, climate targets must be regulated to set a standard, past baseline (for example, 2019) and set ambitious emissions reduction targets whose results can be monitored, verified and compared.