Corporate activities – from fossil fuel development to financing destructive projects to driving consumerism – have had a significant impact on the environment. Regulating corporate behaviour and encouraging sustainable practices will be critical in addressing the climate and environment crises. Governments, shareholders, investors and consumers all play a role in forcing this change.
Greenwashing
There is increasing attention on overstated (or actively misleading) sustainability claims and attempts by companies and governments to “greenwash” their activities through sponsorships, advertising and promotion of relatively small positive programs to distract from larger impacts. Greenwashing undermines efforts to tackle the climate crisis at a time when it matters most. Managing the risks of ‘greenwashing’ will improve the rigour and urgency of climate and nature responses.
What’s been happening?
Australian Sustainable Finance Institute is developing a final Sustainable Finance Taxonomy, outlining mitigation criteria, minimum social safeguards, and the operation of a ‘do not significant harm’ framework
The Federal Court has fined Vanguard Investments Australia $12.9M for misleading claims about its ethical fund, after failing to screen out companies with significant fossil fuel investments
Following Parents for Climate’s proceedings against Energy Australia, claiming their “carbon neutral” marketing is misleading, Energy Australia has dropped the carbon neutral product for new customers (but maintained it for existing customers). Parents for Climate are continuing their proceedings, in what could be a significant case regarding the use of offsets to justify carbon neutral claims
The UK Supreme Court has found that UK climate laws prevent the government from relying on international offset purchases to substantiate net zero claims
The ABS has released a guide on Measuring and Valuing Australia’s Ecosystems, in advance of the 2025 release of the first of National Ecosystem Accounts for Australia (which will help to guide TNFD work)
Climate Integrity released their Risky Influence report, finding that many of Australia’s top companies are lobbying against climate action despite public commitments supporting Paris goals. The report (which follows earlier analysis showing few companies have clear strategies to implement emissions reduction commitments) concludes that companies are exposed to legal risk of misleading consumers and investors, and Board directors are exposed where they do not have oversight of direct and indirect climate lobbying
Active Super was found guilty of misleading customers in relation to claims the fund did not invest in tar oil sands or coal (while investing in ConocoPhillips, Whitehaven Coal and New Hope)
Oil Change International released its Big Oil Reality Check report, examining the climate pledges of major oil and gas companies. The report finds all fail to align with Paris Agreement targets, with emissions reduction plans by Chevron, ConocoPhillips and Exxon being “grossly insufficient”
Greenpeace launched legal action against Woodside claiming the company has misrepresented its emissions reduction achievements by failing to account for Scope 3 emissions
Australian Religious Response to Climate Change made a complaint against Bravus (Adani) for misleading advertising claims
UK Advertising Standards Board banned Toyota ads for “condoning driving that disregards its environmental impact”
Living Oceans, Neighbours of Fish Farms, éko, and the Bob Brown Foundation lodged ACCC complaints against Coles, Woolworths and Aldi for promoting salmon farmed in Tasmania’s Macquarie Harbour as ‘responsibly farmed’ (see Oceans and Coasts)
What’s coming up?
12 February 2025 – Senate inquiry into Greenwashing final report
What is the AEGN doing?
Showcasing businesses committed to high standards and transparency
Encouraging skill-sharing events for members around improving transparency and decision-making, and implementing TNFD and climate reporting
Keeping members updated on outcomes of greenwashing challenges, offset compliance audits and implementation of Chubb review recommendations to ensure ACCUs are rigorous
What can AEGN members do?
Collaborate with other members for alternative sponsorship for events and awards
Support projects seeking to expose fossil fuel sponsorship
Encourage government to take measures to address greenwashing, noting that your investment in environmental and climate action will be undermined if funders and consumers cannot be confident in sustainability claims (see the Fossil Ad Ban campaign for some tips on this)
Review the investment portfolio of your superannuation provider
Use your influence on boards to encourage divestment from fossil fuels and implementation of TNFD and TCFD reporting. This can also include refusing to engage PR and advertising firms who work with fossil fuel clients (see CommsDeclare’s list)
There has been a rise in shareholder activism in recent years as shareholders try to influence corporate conduct around climate and ESG through coordinated votes at AGMs regarding divestment, nominations of climate-focused investors to board positions, calls for disclosure of climate risks, and potential takeovers by large shareholders with a more sustainable investment profile.
What’s been happening?
Whitehaven Coal received a 13% vote against its executive remuneration plan (which Market Forces argued incentivised increasing carbon emissions) and 19% also voted against the reappointment of Chair, Mark Vaile. The vote confirms ongoing concerns from institutional investors
The Commonwealth Bank did not face a climate risk resolution this year after announcing the bank would stop lending to fossil fuel projects without “Paris-aligned transition plans”, but faced questions from shareholders about loopholes that allow the bank to continue lending to Glencore and APA
A resolution calling on Woolworths not to stock salmon from Macquarie Harbour (due to threats to the Maugean skate) attracted 30% support. A similar resolution got support from 37% of Coles’ shareholders on 12 November, adding to pressure on the major supermarkets to consider nature impacts in their supply chains
ACF is calling on major supermarkets to stop purchasing beef from farmers engaged in unlawful land clearing. In response, Woolworths has committed to only stocking ‘deforestation-free’ beef from 2025
A Market Forces report outlined the ways in which banks continue to support fossil fuels projects, despite commitments not to directly finance them
An ACF report has found that banks and super funds have made clear progress on “understanding and integrating nature-related risks” into their financial decision making
The Federal government has issued its first Green Bond
The Federal govt has established a Nature Finance Council to “increase private sector financial flows to benefit nature”
UNEP’s annual State of Finance for Nature report found that in 22-23, “Current finance flows to [nature positive projects] of US$200 billion are massively outweighed by finance flows with direct negative impacts on nature of almost US$7 trillion”
