New analysis published today shows that leading Dutch companies are only committing to cut their emissions by an average of 19% by 2030, well below the requirement to cut emissions in half by 2030 in this year’s report. IPCC Sixth Assessment Report.
This is the first comprehensive analysis of 29 Dutch companies and financial institutions based on a study commissioned by Milieudefensie. The research was conducted by the NewClimate Institute and assesses 21 companies operating in the real economy and 8 financial institutions for the transparency and integrity of their approaches to climate responsibility.
The report uses a 5-point completeness scale. There were no companies demonstrating high or fair integrity, with only five falling into the moderate integrity category: AkzoNobel, BAM Group, DSM, Stellantis and Tata Steel Netherlands. A staggering 24 companies fell into the low or very low integrity category (for the full breakdown of all companies, see the tables at the end).
These 29 companies are highly relevant climate players in their respective sectors. The average reduction of only 19% by 2030 of its commitments falls short of the emission reductions needed globally and in the Netherlands.
Most of the long-term goals set for the post-2030 period lack clarity, 20 out of 21 companies operating in the real economy have set net zero or climate neutrality goals, but this translates into a commitment to decarbonization deep for just two of those companies. Stellantis and DSM confirm that their net-zero emissions targets should be interpreted as a commitment to reduce emissions from their entire value chain by at least 90%. The other companies explicitly exclude significant emission sources, do not specify which emission sources are covered, or rely on offsetting to meet their climate commitments.
Silke Mooldijk of the NewClimate Institute, lead author of the report, commented that none of the companies have published comprehensive emission reduction plans:
“While we get the impression that companies provided more detailed information about their reduction plans following the Milieudefensie call, their plans remain largely insufficient. Many companies’ plans are superficial or do not address key emission sources.”
The research pointed to some promising developments among financial institutions, in particular with regard to increasing restrictions not only on investments in coal but also in oil and gas. However, none of them completely exclude fossil fuels from their portfolio and many continue to provide financial services for harmful activities in the land use or agriculture sector. Financial institutions urgently need to make progress on improving exclusion and participation policies to accelerate decarbonisation financing.
The consequences can be serious if companies continue to set goals that are not as strong as they seem. Regulators can take companies at their word and not put in place stricter guidelines and regulations to drive change. Consumers are misled by the potentially false claims of these companies. And investors who worry about the climate risk of their portfolios will not understand who is well prepared for the transition.
The report’s findings come amid a groundswell of awareness and scrutiny about corporate climate promises in the Netherlands. In a landmark ruling last year, a Dutch court found that Shell’s climate policies violated its “duty of care” to Dutch citizens and ordered it to set more ambitious emissions reduction targets. Similarly, the Dutch advertising standards watchdog asked Shell and KLM to refrain from potentially misleading climate neutrality claims. Increased scrutiny and improved dialogue in the Netherlands can lead Dutch companies to significantly improve the transparency and integrity of their action and demonstrate climate leadership on the global stage.
The report is prepared by the NewClimate Institute on behalf of Milieudefensie (Friends of the Earth Netherlands). NewClimate Institute is a non-profit institute established in 2014 with offices in Cologne and Berlin, Germany, that supports research and implementation of action against climate change around the world. We generate and share knowledge on international climate negotiations, climate action monitoring, climate and development, climate finance, and carbon market mechanisms. We connect up-to-date research with real-world decision-making processes, increasing ambition in action against climate change and helping to find sustainable and equitable solutions. Our flagship projects, such as Climate Action Tracker and Ambition to Action, are internationally recognized and followed. These and other projects place us at the forefront of the climate change forum, where we seek to achieve maximum impact for the international climate change mitigation effort. Visit us at www.newclimate.org or on Twitter @newclimateinst.