On 28 February, sometime late in the afternoon, Australia’s largest greenhouse gas emitters were publicly named without any fanfare. Not even a media release marked the occasion.
The Clean Energy Regulator (CER) releases this information annually under the National Greenhouse and Energy Reporting (NGER) Act 2007, which was introduced into Federal Parliament by then Minister of Environment and Water Resources, Malcolm Turnbull.
According to the legislation’s Explanatory Memorandum, there were multiple objectives including improved public scrutiny: “Public scrutiny of companies’ emissions may encourage greenhouse gas emission reductions and more efficient use of energy, as public perceptions of companies are at stake.”
A laudable objective, but after 15 years of implementation, the NGER scheme garners very little public attention despite the good work of the CER and the 800 or so organisations that collect and submit their data.
Trying to understand the entities that report into the NGER scheme and their commitment to climate action is not a trivial task. The scheme covers a wide range of ASX and international public companies, private companies, universities and government corporations. Their published commitments range from detailed sustainability reports fully compliant with international standards (but dense reading, nevertheless) to absolutely nothing.
We took the novel approach of an “interested bystander” to focus on three simple indicators of commitment: stated goals and timeframe; measurable targets and timeframes; and approach to carbon offsetting.
For an explainer of how the full analysis was conducted, click here.
Start with the “nothings.”
Four reporting entities were so well hidden that we couldn’t reliably find a corporate web presence.
Just under half of the reporting entities had no discernible climate action goals or targets. Some may have made some generalised motherhood statements, but no clear commitments. Even more concerning, some made no reference to climate change.
If the “nothings” did have a concern about climate change and the impact on their organisation, they did a fantastic job of hiding it.
This includes 35 government-owned corporations that were assessed to have no to low published commitment to climate action (6% of national emissions).
31 entities covered by the Safeguard Mechanism have no or limited published climate goals.
The other end of the scale
At the other end of the scale, we identified 131 entities that we classified as having moderate to very high commitment to climate action, which were mostly in the property, retail, higher education or financial services sectors.
Our method placed higher weightings on bolder climate targets, earlier action and an explicit carbon offsetting strategy. Unfortunately, this resulted in a harsher assessment of companies in hard-to-abate sectors.
The focus on carbon offsets may be contentious, but the reality is that we cannot achieve Net Zero without removing CO2 from the atmosphere through nature-based and technology-based offsets. We need to improve the integrity carbon offsetting – not demonise it into oblivion.
Also, companies that are transparent about their use of carbon offsets, and why, need to be confident that they will pass public and regulatory scrutiny (or risk accusations of greenwashing).
Tighten the NGER noose
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If the NGER scheme was designed, in part, to be a ‘name and shame’ or a regulatory nudge approach to climate action, then our results show that it is only partially working.
Credit needs to be given to the CER and their work on creating a simplified reporting system with last year’s pilot Corporate Emissions Reduction Transparency (CERT) report. But the scheme is voluntary and will only attract those with a higher commitment to climate action.
With a few simple tweaks, the NGER system could better fulfil its role in improving public scrutiny. These could include the publishing of the corporate webpage, publishing a company’s commitment to climate action (or not), carbon offset use and year-on-year changes.
As we measure our progress on our long march to Net Zero, the annual release of the NGER data should be a moment of pride for the high achievers and a “please explain” for those that are less ambitious.