Why transparency isn't enough for climate action

🌱 Are we walking the talk on corporate climate action? A new study by Colesanti Senni et al. (Environmental Research Communications, 2024) examines how corporations disclose their climate transition plans. Using a Large Language Model-based tool, the research assessed the disclosures of Climate Action 100+ companies—the largest global emitters. The findings reveal critical gaps and opportunities in how companies communicate their climate commitments. 📊 What the study found: ✔️ Most companies are adept at outlining ambitious targets (the “talk”), such as net-zero goals and interim milestones. However, they often fall short on the actionable steps needed to achieve them (the “walk”). ✔️ The companies that disclose more tend to show lower emissions, suggesting that transparency might signal a stronger alignment between planning and progress. ⚠️ A lack of standardization in reporting frameworks remains a major barrier. Without clear, consistent benchmarks, stakeholders are left questioning whether disclosures reflect genuine efforts or greenwashing. 🧩 My reflections: When I think about corporate climate responsibility, I see three interconnected layers: intentions, actions, and outcomes. Each is critical, but the gaps between them are where trust and progress falter. ✨ Intentions: Bold commitments are often a sign of leadership, but when they remain vague or unsupported by detail, they risk being seen as little more than a marketing exercise. 🔨 Actions: This is the most critical layer—and often the weakest link. Without concrete, measurable steps, even the best intentions lack credibility. Actions should demonstrate not just a plan but a willingness to take tough, sometimes unpopular, decisions. 📊 Outcomes: While outcomes are the ultimate goal, they’re also where the evidence lies. The study’s findings suggest that detailed disclosures might correlate with lower emissions, but is this because these companies are more transparent—or simply more prepared? This cycle of intentions, actions, and outcomes is not just a corporate issue—it’s a systemic one. How can we better connect these layers to create a climate response that is both transparent and transformative? 🌍 What are your thoughts? 💡 How can companies ensure their actions truly bridge the gap between intentions and outcomes? 💡 Are current disclosure frameworks helping stakeholders distinguish between real progress and polished promises—or are they creating more confusion? You can read the full study here: https://lnkd.in/exEDwzaK #ClimateAction #Sustainability #Greenwashing #CorporateResponsibility #NetZero

I've seen LinkedIn posts today lamenting the downturn in #CDP scores, wondering what it means and how we’ll assess climate performance going forward. Let me offer a different perspective. For those of us focused on real-world climate outcomes (setting aside, for a moment, those focused on corporate financial risk), the emphasis on entity-level frameworks—whether for target-setting or disclosure—was never the right foundation for driving or evaluating real climate outcomes. Even if ambitious and perfectly executed (which most are not), corporate commitments and disclosures cannot deliver the systems-level transformations needed to decarbonize our global economy. Real climate progress requires coordinated, sector-wide or economy-wide transitions—across electricity, transport, buildings, industry—integrating evolving technologies, engineering solutions, institutional reforms, public policy, and aligned financing strategies. These transformations *cannot* be achieved by the sum of individual targets/strategies, nor are they meaningfully captured—or incentivized—by existing disclosure frameworks. Consider the tech sector. Data centers could be powerful drivers of clean energy investment, grid modernization, and digital inclusion—especially in emerging markets. None of this would be reflected in footprint-based reporting. In fact, such metrics disincentivize companies from entering high-emissions markets where they could have the greatest impact. (indeed, many risk-assessment frameworks will have similarly perverse consequences of disincentivizing investments in vulnerable areas or areas where data is unreliable - rather than driving solutions in those places.) Similarly, V2G technologies can enhance grid resilience and accelerate renewable integration—but this too requires coordinated policy, infrastructure, and regulation across automakers, utilities, and governments. It’s a systems solution, not an individual one, and current frameworks neither incentivize companies to pursue it nor report on whether they do. We’ve spent years demanding and tracking corporate targets, only to be disappointed when they shift, disappear, or fail to add up. But climate action isn’t the sum of individual efforts, as these frameworks suggest. It’s about changing the systems that shape corporate decision-making. As systems transform, companies will change too—some as leaders, co-designing the solutions -- and others as laggards, forced to change as systems do. (*which goes back to my parenthetical above: if interested in a company's financial resilience more than real climate outcomes, then some disclosures could be helpful; CDP scores mainly report on how companies assess and manage risk, not on their performance. As I wrote yesterday, we often confuse/conflate financial resilience & risk management with real climate outcomes; the posts on CDP scores are a case in point.) Paul DeNoon Darius Nassiry Vanessa Fajans-Turner Columbia Center on Sustainable Investment

The latest Corporate Climate Responsibility Monitor 2025 is a deep, 165-page analysis of the #climate strategies of 55 major global companies (https://lnkd.in/eNKsG7iB). And the results? They are are not great, to say the least. The analysis finds that NONE of the 20 companies assessed demonstrate a climate strategy with ‘reasonable’ or ‘high’ integrity—where integrity reflects the credibility, transparency, and sector-specific robustness of a company’s climate approach. Only a few, such as H&M Group, adidas, and Danone, achieve a “moderate” rating, reflecting early steps toward more credible strategies and sector-specific transition efforts. One word that comes to mind when reviewing the report is messiness. For example, the authors note they can’t calculate a median reduction commitment for 2030 due to persistent structural obstacles—like sector-specific accounting malpractices and incomplete emissions disclosures—that make it increasingly unclear what companies are actually committing to. But this messiness isn’t accidental. It reflects not only flaws in the current assessment and validation systems like #SBTi or #TPI (see pp. 13–14 of the report), but also the deeper dysfunctions of sustainability-as-usual. The problem isn’t just tactical or strategic—it’s #systemic. Companies operate within a framework that prioritizes short-term growth and profit maximization, making anything outside that logic—including meaningful #climateaction—extremely difficult to pursue. This will only change when the system itself changes. Until then, companies will continue to make mostly incremental progress—but it will remain insufficient, because truly sufficient progress would require rethinking and redesigning their #businessmodels. And that kind of transformation still lacks both the leadership courage and the ‘permission’ of financial markets needed to move forward.

The pervasiveness of #greenwashing scandals—where companies mislead the public about their environmental initiatives—has created a real challenge in achieving global #climate goals. Examples include Keurig Dr Pepper Inc.'s misleading claims about recycling, The Coca-Cola Company's advertisements about plastic recycling and oil companies like Shell and ExxonMobil promoting their "net zero" plans. Many companies today seem to devote more attention and money to the marketing of misleading environmental claims than they do trying to be sustainable. 🌍 This recent piece in The Conversation UK discusses how at the heart of this issue is #corporategovernance. Boards of directors have a critical role in overseeing environmental performance, but their effectiveness is heavily influenced by board composition. Research has shown that co-opted boards, where directors are appointed after a CEO’s tenure begins often struggle to provide unbiased oversight. This leads to erratic decision-making and lack-lustre environmental initiatives. 💡 To drive real change, companies need to prioritize appointing independent directors with climate expertise, adopt transparent carbon-reduction goals, and ensure environmental expertise is a key part of their strategic decision-making. These steps will help boards genuinely oversee climate efforts, rather than relying on superficial PR strategies that risk public trust. 📖 These points resonate with themes in #TheProfiteers where I argue businesses too often privatize profits while socializing costs, and then mislead us to think they are responsible. Real corporate accountability will require systemic change.

What happens when companies break their climate promises? Almost nothing. A new study has uncovered troubling truths about corporate climate commitments. Out of 1,041 companies with emissions reduction targets set for 2020: -9% (88 firms) openly failed to meet their goals. -31% (320 firms) stopped reporting on their targets without explanation. What happens when companies miss these targets? Practically no consequences: -Only three failed companies faced media scrutiny. -No significant market backlash, media sentiment shifts, or ESG rating downgrades. In contrast, companies were rewarded with positive press and improved ESG ratings simply for announcing these targets. The bigger issue: This accountability gap threatens the credibility of ambitious 2030 and 2050 climate pledges. Unlike financial targets, which are rigorously monitored, emissions goals often exist in a vacuum—without oversight or real consequences for failure. Interestingly, the study found that: -Firms in common-law countries and those with stronger media accountability had better success rates. -High-emitting sectors like energy and materials struggled the most, with the highest rates of "disappeared" targets. With more companies backing away from climate action, we cannot afford to let this cycle continue. It’s time for corporate sustainability leadership to move beyond announcements and deliver measurable, transparent results. Accountability mechanisms—demanded by both regulators and stakeholders are urgently needed. A great piece of work by Xiaoyan Jiang, Shawn Kim, and Shirley Simiao Lu! Let’s learn from these insights to ensure that corporate climate pledges actually deliver. #climatechange #netzero #esg

The Evolution of Net Zero 🌍 The concept of net zero has evolved from a scientific insight into a central framework for guiding climate action. It has been adopted by governments, companies and institutions worldwide, becoming a shared point of reference for long-term planning. But as the concept has gained visibility, concerns about its credibility and impact have become more pronounced. Major milestones have supported this evolution. Global agreements like the Paris Agreement, new national laws and growing corporate commitments have helped position net zero as a common goal. Scientific assessments have repeatedly shown that reaching net zero carbon dioxide emissions is essential to limit warming and prevent dangerous climate disruption. Despite this momentum, action remains insufficient. While the number of targets continues to grow, many lack transparency, clear scope or meaningful interim goals. Without credible implementation plans, net zero runs the risk of becoming a promise without delivery. The gap between ambition and reality is closing rapidly. Emissions continue to rise in key sectors, and the latest global stocktakes confirm that current national plans are not aligned with the temperature goals set in the Paris Agreement. More ambitious action is urgently required. As expectations increase, so does scrutiny. New standards have emerged to evaluate whether targets are science based, comprehensive and supported by near-term actions. These tools are essential but not enough on their own. Better regulation, consistent data and stronger accountability mechanisms are needed. There is a growing concern that net zero is being used as a communications tool instead of a strategy for real transformation. Delayed action today will lead to deeper economic and environmental consequences in the near future. What is required now is a shift from target setting to target delivery. Countries and companies must move from intention to execution, with transparent roadmaps and structural changes across operations and value chains. Net zero remains a critical framework for climate ambition. But its true value will depend on how effectively it drives immediate, credible and sustained action. The window for meaningful progress is rapidly closing. Source: Zero tracker #sustainability #sustainable #business #esg