The statement that appeared on the website of the Science Based Targets initiative last month I so disagreed with the position of the climate group that her own communications team thought she had been hacked.
SBTiwhose blessing confers important credibility to the corporate plans of net zero emissions, seemed to have changed his stance on a controversial issue. The press release from its board of directors on April 9 said that Companies could use carbon credits to offset so-called Scope 3 emissions from their supply chainsan approach that some scientists have warned could jeopardize the fight against global warming.
Staff members assumed it was a hoax and they temporarily withdrew the document. When it turned out to be true, they asked the board and CEO to resign. To many it seemed that the measure had come out of nowhere.
However, interviews with current and former employees, as well as others familiar with the decision, reveal how the seeds of the policy change were sown over the past year. According to them, things began to change when SBTi It went from being a collaboration of three non-governmental organizations and the United Nations to an independent entity governed by a board of directors that included several people who want to grow the offset market.
The change was driven by the growing prominence of SBTi. The group, founded in 2015, employs about 130 people and is funded by philanthropic money, but has become the main arbiter of whether companies are doing the right thing for the planet. It has validated the climate plans of more than 5,000 companies, from Apple Inc. until Volkswagen AGand is trusted by investors and policymakers to judge corporate green goals.
The position of SBTi It has long been that companies should prioritize reducing emissions throughout their supply chain and use credits only to offset the small amount that is impossible to reduce. While some experts have praised that rigorous approach, many corporate figures, and even some climate activists, have rebuked SBTi for being inflexible and acting as an impediment to helping critical funds reach developing countries.
“This is a systemic debate,” said Paul Simpson, a former board member of SBTi and now a partner at sustainability consultancy ERM. “It is bigger than SBTi, but SBTi has become the lightning rod.”
The fact that the new board issued a statement about the chiefs of staff, in violation of the rules and procedures of SBTihas reinforced the internal opinion that the trustees are unaccountable, disconnected from the work of SBTi and driving their own commercial agendas.
Of the nine-person board, only Manuel Pulgar-Vidalformer Minister of the Environment of Peru who now supervises the work of WWF on climate and energy, voted against the publication of the April 9 declaration. (A representative of the UN does not have the right to vote). Thumb-Vidal declined to comment.
“The SBTi will not shy away from difficult questions, but we will not be invaded by them either,” Luiz Amaral, director general of the SBTi, said in an emailed statement. “SBTi governance is designed to have different perspectives represented and that diversity is welcome.”
The guide is supposed to SBTi aligns with what the latest science says is necessary to avoid the worst impacts of global warming. But as the goals of the Paris Agreement increasingly out of reach, the group has come under increasing pressure to be more forgiving and pragmaticand some of its employees face Fierce online criticism and even physical intimidation.
At a meeting in London Among the biggest supporters of offsets in March, several prominent figures highlighted the guidelines of SBTi. Rachel Kyteco-president of the Voluntary Carbon Market Integrity Initiativewhose ambition is to grow the offset market, spoke about an “SBTi problem” that she said needed to be resolved urgently, according to people who attended the event.
Kyte declined to comment on the London meetingciting an agreement that speakers would not be summoned unless their comments were approved. Still, he said initiatives like SBTi should never have been a permanent solution.
“We have created many things like NGO structures in the hope that governments will get their act together and start regulating,” he said. “And of course, many, many years later, these types of temporary structures have become very important in the landscape.”
The board of directors of SBTi It is made up of one person from each of its four founding entities: CDP, the United Nations Global Compact, the World Resources Institute and WWF. There is also a representative of the coalition We Mean Businesswho describes herself as a founding partner of SBTi and works closely with businesses to reduce emissions, and four independent trustees.
The most public cheerleader for compensation is Maria Mendiluce of We Mean Business. In an op-ed she co-authored for Reuters last month, she wrote that the board’s plan to relax rules on offsets would put it “on the right side of climate history.” The article also said that SBTi will publish in July a draft analysis on how different tools, including carbon credits, can “be used responsibly, with appropriate barriers and limits.”
That was not true, according to staff members. SBTiwho characterized it as an exaggeration of what they had agreed to produce as part of a September “call for evidence” that, among other things, sought opinions on the effectiveness of the offsets. The claim was so egregious, in their opinion, that they discussed requesting a retraction or correction of the piece.
Mendiluce did not respond to questions about how he described the upcoming report. “Climate change is accelerating and we do not have the luxury of time to ignore any options that accelerate progress,” he said. “We need new tools to reduce emissions now.”
There were already internal suspicions that the review, which also covered renewable energy credits and certificates of sustainable aviation fuelwas simply a pretext to justify the relaxation of the compensation guidelines for SBTi. An initial suggestion from superiors that the project be carried out in collaboration with VCMI He had already set off the alarms.
Most worrying, however, was Amaral’s pressure to speed up the report’s publication. The call for tests concluded in November, after which Amaral requested that the results be ready by early December, coinciding with the COP28 climate summit.
That deadline was missed and the staff told Amaral that their expectations were unrealistic. They had received more than 800 submissions from NGO and corporations, spanning more than 15,000 pages, including technical reports and case studies. Amaral He told the team to focus on the answers related to carbon credits and return to the other tools at a later date. “I have repeatedly pushed to meet ambitious deadlines,” Amaral said in response to questions. “This is urgent work.”
Still, the board had not seen all of the comments, nor the technical team’s assessment of them, when it issued its April 9 statement. What they had been presented with was far from a ringing endorsement of offsets: preliminary survey results found that half of the empirical data received by SBTi They showed that the carbon credits They were ineffective.
Ulrich Volzprofessor of economics and director of the Center for Sustainable Finance at the SOAS University of Londonsaid that the incident of SBTi highlights the risk that “certain philanthropies and financial institutions exert enormous influence in shaping the agendas of some think tanks, university research centers and other climate-focused organizations”.
The two main financiers of SBTi are Bezos Earth Fundwhich supports the growth of the compensation market, and the IKEA Foundation. Bloomberg Philanthropiesthe philanthropic organization of Michael Bloombergfounder and majority owner of Bloomberg LPis a financier of specific projects of SBTi. A spokesperson for the IKEA Foundation said he supports SBTi as an “independent institution”. Bezos Earth Fund did not respond to a request for comment.
BloombergNEF estimates that the offset market can grow from about $2 billion today to more than $1 trillion in 2050 if SBTi makes its rules more flexible. “There is a lot of money to be made in voluntary carbon markets and there are powerful commercial interests to shape these markets,” Volz said.
SBTi has begun offering mental health support to employees as discontent grows.
In September, in a external meeting of the entire team in Amsterdam, Senior leaders faced questions about the process for selecting board members and for finding and reporting conflicts of interest. Some employees also felt uncomfortable with the comments that Amaral made last year about his visit to one of the houses of Jeff Bezos.
Amaral has said it “deeply regrets” how the April 9 statement fueled “concern and distress” and that SBTi will provide more details in July.
Meanwhile, the work of SBTi keep going. The entity is still validating the company’s emissions objectives, announced a “major review” of its corporate net zero standard last month and is working on guidance to set targets for Scope 3 emissions.
Calls for a compromise continue, especially after offset advocates scored a major victory this week. Senior US officials, including the Treasury Secretary Janet Yellenrecommended that companies can use the credits to offset a portion of their Scope 3 emissions.
“This is a tempest in a teapot, but I worry it could boil over and undermine effective corporate climate action”said Nat Keohanepresident of Center for Climate and Energy Solutions, which serves as the secretariat of the former US government. The climate envoy’s offsets initiative John Kerryhe Energy Transition Accelerator.
The best way to “hold the tea” might be for SBTi to do what its board suggested in April, Keohane said. You need to “consider the evidence with an open mind and find a way forward that indicates there is room for some flexibility in Scope 3.”
