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California cracks down on corporate greenwashing Judd Legum

Published

10 months ago

October 10, 2023

In the United States, a lot of people are concerned about climate change. A 2022 Pew Research poll found 54% of Americans “describe climate change as a major threat to the country’s well-being.” An even larger number of Americans, 67%, believe that corporations are “large businesses and corporations are doing too little to reduce the effects of climate change.”

So corporations, eager to improve their image among American consumers, have made dramatic announcements about their commitment to combating climate change. “What was once called climate change is now a climate crisis,” Walmart CEO Doug McMillon said on September 21, 2020. “Ice sheets are collapsing, extreme weather events are increasing, catastrophic fires are occurring, oceans are acidifying and biodiversity is decreasing.” McMillon announced Walmart’s new goal to “achieve zero emissions in our global operations by 2040.”

It is fairly easy to make promises about 2040, which is still quite far away. It is harder to make real progress now.

So, how is Walmart’s effort going? According to Walmart’s website, the company is doing great. It has reduced its carbon emission from 17.2 million metric tons of carbon dioxide (MMT CO2e) in 2019 to 15.93 MMT CO2e in 2020, to 13.99 MMT CO2e in 2021. (The company has not yet released data for 2022.)

But there are no enforceable standards for this kind of reporting. Walmart gets to decide what emissions it wants to include in its public reports, and what it does not. In Walmart’s case, it has decided to include emissions it directly produces, known as Scope 1, and emissions from energy it purchases, known as Scope 2. Notably, Walmart’s Scope 1 carbon emissions have been increasing in recent years, from 6.85 MMT CO2e in 2019 to 7.37 MMT CO2e. The overall reported reduction at Walmart was achieved through buying cleaner energy.

But Walmart has decided to exclude from its public reporting all carbon emissions from the products it sells in its stores, known as Scope 3. According to estimates cited by Walmart, Scope 3 emissions account for approximately 95% of Walmart’s carbon footprint. It is true that Scope 3 emissions are more difficult to calculate. But Walmart is not making any public effort to do so. That is inconsistent with the Greenhouse Gas Protocol, a “comprehensive global standardized framework[] to measure and manage greenhouse gas emissions.”

This makes Walmart’s disclosure essentially meaningless. The reported numbers do not indicate whether Walmart is responsible for more or less carbon emissions than the year before. That’s why the New Climate Institute, a nonprofit organization that evaluates carbon emissions disclosures, characterized Walmart’s disclosures as “low integrity.” There are many other large corporations producing climate disclosures that are similarly lacking.

California, however, recently enacted legislation that could force Walmart and other large corporations to come clean. On Saturday, Governor Gavin Newsom (D) signed historic legislation that will require “more than 5,300 companies that operate in California and make more than $1 billion in annual revenues” to annually report their carbon emissions to the state. Critically, these companies will be required to report Scope 1, 2, and 3 emissions, consistent with the Greenhouse Gas Protocol. The law is premised on the idea that Californians “have a right to know about the sources of carbon pollution. . . in order to make informed decisions.”

The law will apply to any company “doing business” in California. This does not just include companies that are headquartered or have physical locations in California. Any company that engages “in any transaction for the purpose of financial gain within California” is considered “doing business” in California. This includes Walmart and most of the world’s largest companies.

The new law, the Climate Corporate Data Accountability Act, will require companies to report their Scope 1 and Scope 2 emissions in 2026, and their Scope 3 emission in 2027. The data will be “housed on a new publicly available digital registry administered by an organization contracted by the California State Air Resources Board.”

Failure to accurately report data could result in fines of up to $500,000. Companies who demonstrate they had a “reasonable basis” for their Scope 3 data would not be subject to fines.

Corporate lobbyists are not done yet

The Climate Corporate Data Accountability Act was adamantly opposed by corporate lobbyists and trade groups. Corporations strongly prefer the status quo, which enables them to set the standards for any carbon emissions disclosure.

The California Chamber of Commerce (CalChamber), which counts Walmart, Boeing, CVS, and many other major corporations as members, slammed the disclosure law as “a costly reporting requirement that does not help us meet our climate goals.” The group claimed the law would give “out-of-state and foreign companies a market advantage, driving production out-of-state and increasing the cost of goods for California residents.” CalChamber also claims that “assessing Scope 3 emissions data with any degree of accuracy is not yet possible.” (Thousands of companies, however, are already calculating their Scope 3 emissions.)

Not all corporations, however, agreed with the California Chamber of Commerce’s assessment. Microsoft, IKEA USA, Sierra Nevada Brewing Co., Patagonia, Adobe, and others signed an August letter supporting the Climate Corporate Data Accountability Act. The companies said that “disclosure will help companies, investors, and the State better understand emission output, and strengthen the ability of economic actors to strategize in combatting costly risks associated with climate change.” The companies argued that “consistent, comparable, and reliable emissions data at scale is necessary to fully assess the global economy’s risk exposure and to navigate the path to a net-zero future.” In September, Apple, which is based in California, announced its support for the legislation.

Corporate lobbyists have not given up. After Newsom signed the legislation, CalChamber released a statement: “We look forward to working with the Governor’s office on SB 253 clean-up legislation that will address some of the major concerns of our members, particularly the impact on small business.” The reference to “small business” indicates that CalChamber will seek to undercut the Scope 3 reporting in the law. Although reporting is only required for businesses with more than $1 billion in annual revenue, CalChamber claims that including Scope 3 emissions will require small businesses that contract with larger businesses to calculate carbon emissions estimates.

Newsom appears open to the idea, telling the New York Times’ David Gelles that he wanted “some cleanup” of the new law. Newsom “did not clarify the changes that he wished to make.”

The federal factor

Corporate opponents of California’s new law argue that it is duplicative because the federal Securities and Exchange Commission (SEC) is considering imposing its own carbon emissions reporting requirements.

But California’s new law differs from the SEC’s proposed rules in two key ways. First, the SEC’s rules would only apply to public companies. California’s rules cover private and public companies. Second, the SEC’s rules would not comprehensively require disclosure of Scope 3 emissions. Scope 3 emissions would have to be disclosed if they are “material” for investors or if the company made specific public commitments to reduce Scope 3 emissions.

SEC Chairman Gary Gensler appeared supportive of California’s proposed disclosure requirements during a September 27 appearance during a House oversight hearing. Many corporations have objected to the proposed SEC rule, citing the cost. Gensler argued that complying with the SEC rule would be less expensive than previously estimated since many companies would already be producing similar information for California.

Substacks

July 25, 2024 Heather Cox Richardson

Published

10 hours ago

July 26, 2024

Substacks

TGIF: The Week Unburdened by the Week That Has Been Suzy Weiss

Published

16 hours ago

July 26, 2024

Pro-Palestinian protesters gather outside of Union Station to protest Israeli prime minister Benjamin Netanyahu’s visit to the United States. (Probal Rashid via Getty Images)

Oh, no, it’s the sister again, for another slow news week. Let’s get to it.

→ Biden dropped out: Six years ago emotionally, but technically this past Sunday, Joe Biden dropped out of the presidential race. He did it via X and promptly threw his support (and cash) behind Vice President Kamala Harris. Then he got Covid and hunkered down in Delaware—or depending on what hooch you’ve been drinking, died and was reanimated so he could appear before the cameras on Wednesday to address the nation. Joe’s family, including Hunter, sat along the wall of the Oval Office as he spoke. The president talked about the cancer moonshot, ending the war in Gaza, putting the party over himself, and Kamala’s tenacity, as Kamala’s pistol dug ever-so-slightly harder into his back. Right after, Jill, the First Lady of passive aggression, who apparently wanted to outdo her heart emoji, tweeted a handwritten note “to those who never wavered, to those who refused to doubt, to those who always believed.” I respect a First Lady who stands by her man and her energetic stepson. A First Lady who sees the high road way up there and says to herself, “If they want us out of here so bad, they can clean out the fridge and strip the beds themselves!”

→ Kamala is brat, Biden is boots, please God send the asteroid today: I’ve learned the hard way—and by that I mean my parents once asked me what “WAP” meant—that certain things should never be explained with words. It’s not that it’s impossible, it’s just that it embarrasses everyone.

That’s how I feel about the whole Kamala-is-brat thing. Brat is a good album about partying and getting older and having anxiety that was released earlier this summer by Charli XCX. But it’s since been adopted by too-online and very young people as a personality, and by Kamala Harris’s campaign as a mode to relate to those very young people. Her campaign is leaning into the whole green look of the album to try and win over Gen Z, and generally recasting her many viral moments—“You think you just fell out of a coconut tree?” “I love Venn diagrams” “What can be, unburdened but what has been”—as calling cards. It’s like when Hillary went on Broad City, only this time more cringe.

And now we have Jake Tapper and Greg Gutfeld grappling with the “essence” and the “aesthetic” and overall vibe of brat girl summer. We used to be a serious country. We used to make things.

Here’s the thing about Kamla: she is hilarious and campy, but unintentionally so. Any goodwill that her goofy dances or weird turns of phrase garner should be considered bonus points, not game play. Was there ever any doubt that Fire Island would go blue? We’ve been debating whether Kamala’s meme campaign is a good move for her prospects in the Free Press Slack, and here I’ll borrow from my older and wiser colleague Peter Savodnik: “There is nothing more pathetic than an older person who cares what a younger person thinks is cool.”

→ Boomer behavior: While Kamala’s campaign is being run by a 24-year-old twink with an Adderall prescription, J.D. Vance’s speechwriter seems to be a drunk Boomer who just got kicked out of a 7-11. Vance, appearing this week at a rally in Middletown, Ohio, riffed, “Democrats say that it is racist to believe. . . well, they say it’s racist to do anything. I had a Diet Mountain Dew yesterday and one today, and I’m sure they’re going to call that racist too.” Crickets. Horror. Major “Thanks, Obama” energy. There was also a bit on fried bologna sandwiches and a lot of “lemme tell you another story.” The guy is 39 but sounds older than Biden.

Fresher, 35-to-60-year-old blood is exactly what we’ve been begging for. Let the Boomers boom, let the Zoomers zoom. Kamala and J.D.: act your age.

Substacks

July 25, 2024 Heather Cox Richardson

Published

20 hours ago

July 26, 2024

Momentum continues to build behind Vice President Kamala Harris to become the Democratic Party’s presidential nominee, and the national narrative as a whole has shifted.

Democrats appear to be generating significant enthusiasm among younger Americans. Yesterday, for the first time in their history, the March for Our Lives organization endorsed a presidential candidate: Kamala Harris. Students from the Marjory Stoneman Douglas High School in Parkland, Florida, organized March for Our Lives after the shooting there in 2018. Executive director Natalie Fall said that the organization “will work to mobilize young people across the country to support Vice President Harris and other down-ballot candidates, with a particular focus on the states and races where we can make up the margin of victory—in Arizona, New York, Michigan, and Florida.”

Andrea Hailey of Vote.org announced that in the 48 hours after President Biden said he would not accept the Democratic nomination, nearly 40,000 people registered to vote. That meant a daily increase in new registrations of almost 700%.

People are turning out for Harris in impressive numbers. In the hours after she launched her campaign, Win With Black Women rallied 44,000 Black women on Zoom and raised $1.6 million. On Monday, around 20,000 Black men rallied to raise $1.2 million. Tonight, challenged to “answer the call,” 164,000 white women joined an event that “broke Zoom” and raised more than $2 million and tens of thousands of new volunteers.

Another significant endorsement for Harris came yesterday from Geoff Duncan, the Republican former lieutenant governor of Georgia, who wrote on social media: “I’m committed to beating Donald Trump. The only vehicle left for me to do that with is the Democratic Party. If that requires me to vote for, speak for, or endorse [Kamala Harris] then count me in!” Duncan’s public announcement offers permission for other Georgia Republicans to make a similar shift. In 1964, South Carolina senator Strom Thurmond similarly paved the way for southern Democrats to vote for Republican presidential candidate Barry Goldwater.

Harris’s appearances are generating such enthusiasm from audiences that when she delivered the keynote address this morning at the convention of the American Federation of Teachers in Houston, Texas, the applause delayed her ability to begin. After a speech defending education and calling out the cuts to it in Project 2025, Harris ended by demonstrating that after decades of Democrats being accused of being anti-American, Trump’s denigration of the country has enabled the party to claim the position of being America’s defenders.

“When we vote, we make our voices heard,” Harris said. “So today, I ask you, AFT, are you ready to make your voices heard? Do we believe in freedom? Do we believe in opportunity? Do we believe in the promise of America? And are we ready to fight for it? And when we fight, we win! God bless you and God bless the United States of America.”

Today the Commerce Department reported that economic growth in the second quarter was higher than expected, coming in at 2.8%, thanks to higher spending driven by higher wages. The country’s changing momentum is showing in media stories hyping the booming economy Biden’s team tried for years to get traction on. “Full Employment is Joe Biden’s True Legacy” was the title of a story by Zachary Carter that appeared yesterday in Slate; CNN responded to today’s good economic news with an article by Bryan Mena titled: “The US economy is pulling off something historic.”

With Harris appearing to have sewn up the nomination, the question has turned to her vice presidential pick. That question is fueling the sense of excitement as potential choices are in front of cameras and on social media advocating Democratic positions and defending the United States from Trump’s denigration. Pennsylvania governor Josh Shapiro listed the economic gains of the past years, and said: “Trump, you’ve got to stop sh*t talking America. We’ve got to start standing tall and being patriotic and showing how much we love this amazing nation.”

The vice presidential hopefuls appear to be having some fun with showcasing their personalities, as Minnesota governor Tim Walz did in his video from the Minnesota State Fair where he and his daughter went on an extreme ride. So are social media users who have dug up old videos of, for example, Transportation Secretary Pete Buttigieg explaining how he would pilot a small starfighter that had lost its auxiliary shields, or Arizona senator Mark Kelly’s identical twin brother Scott pranking a fellow astronaut on the Space Station with a gorilla suit Mark smuggled on board.

That sense of fun is an enormous relief after years of political weight, and it has spilled over into making fun of the Republican ticket, most notably with a false story that vice presidential candidate J.D. Vance wrote about—and I cannot believe I am typing this—having sex with a couch. The story is stupid, but worse are the denials of it, which have spread the story into populations that otherwise would likely not have seen it.

Just two weeks ago, Vance appeared to be the leader of the next generation of extremist MAGA Republicans, but now that calculation seems to have been hasty. Vance is a staunch opponent of abortion—the key issue in 2024—and he has been vocal in his disdain of women who have not given birth, saying in 2021, for example, that the U.S. was being run by “a bunch of childless cat ladies who are miserable at their own lives and the choices that they’ve made and so they want to make the rest of the country miserable, too.” He went on to say that people who don’t have children “don’t really have a direct stake” in the country.

Republican commentator Meghan McCain noted that Vance’s “comments are activating women across all sides, including my most conservative Trump supporting friends. These comments have caused real pain and are just innately unchristian.” Actor Jennifer Aniston, who tends to stay out of politics, posted: “I truly can’t believe this is coming from a potential VP of The United States.” Vance had called out Harris by name in those 2021 comments, and Second Gentleman Doug Emhoff’s ex-wife Kerstin Emhoff took to social media to defend Harris from Vance’s attacks on her as “childless,” calling her “a co-parent with Doug and I. She is loving, nurturing, fiercely protective and always present. I love our blended family and am grateful to have her in it.” Harris’s stepdaughter chimed in: “I love my three parents.”

Vance also ties the Republican ticket firmly to Project 2025. The Trump camp has worked to distance itself from Project 2025—not convincingly, since the two are obviously closely tied, but it turns out that Vance wrote the introduction for a forthcoming book by Heritage Foundation president Kevin Roberts, who was the lead author of Project 2025. The book appears to popularize that plan, right down to its endorsement of a “Second American Revolution,” and according to the book deal report, proceeds from the book will go to the Heritage Foundation “and aligned nonprofits.”

Now Vance’s words praising Project 2025 will be in print, just in time for the election. Yesterday, Trump posted: “I have nothing to do with, and know nothing about, Project 25 [sic]. The fact that I do is merely disinformation put out by the Radical Left Democrat Thugs. Do not believe them!”

Trump is clearly aware of, and concerned about, the changing narrative. This morning, he called in to Fox & Friends, saying, “We don’t need the votes. I have so many votes. I’m in Florida now…and every house has a Trump-Vance sign on it. Every single house…. It’s amazing the spirit…. This election has more spirit than I’ve ever seen ever before.” Tonight the Trump campaign proved their worry by backing out of debates with Harris, saying debates can’t be scheduled until she is the official nominee, although Biden was not the official nominee when they met in June.

The larger narrative shift has affected the media approach to Trump, who is accustomed to shaping perceptions as he wishes. Now, 12 days after the mass shooting at his rally in Butler, Pennsylvania, there is increasing media attention to the fact that there has still been no medical report on Trump’s injuries, although he wore a large bandage on his ear at the Republican National Convention and said at a rally in Grand Rapids, Michigan, on Saturday that he “took a bullet for democracy.”

Yesterday, FBI director Christopher Wray told Congress that it is not clear whether Trump was “grazed” by a bullet or by shrapnel, words that former federal prosecutor Joyce Vance called “FBI speak for, ‘it’s unlikely it was a bullet.’”

CNN chief medical consultant Dr. Sanjay Gupta noted last week that the people need a real medical evaluation of Trump’s injuries, explaining that “gunshot blasts near the head can cause injuries that aren’t immediately noticeable, such as bleeding in or on the brain, damage to the inner ear or even psychological trauma.” But, as Josh Marshall at Talking Points Memo has noted, much of the press has kept mum about the story.

Media outlets have reported Wray’s testimony, though, and in a social media post today, Trump called on Wray, whom he appointed to head the FBI, to resign from his post for “LYING TO CONGRESS.” Tonight, he reiterated that “it was…a bullet that hit my ear, and hit it hard.”

Perhaps eager to get back to their districts, House Republicans canceled their expected votes on appropriations bills scheduled for next week and left town today for their August recess. The House will not reconvene until early September. The government’s fiscal year 2025 begins on October 1.

—

Notes:

https://www.nytimes.com/2024/07/24/opinion/trump-lies-charts-data.html

https://marchforourlives.org/in-a-first-ever-endorsement-march-for-our-lives-endorses-kamala-harris-for-president/

https://www.reuters.com/markets/us/us-economic-growth-regains-steam-second-quarter-inflation-slows-2024-07-25/

https://slate.com/news-and-politics/2024/07/biden-economy-employment-inflation.html

https://www.cnn.com/2024/07/25/entertainment/jennifer-aniston-jd-vance/index.html

https://www.cnn.com/2024/07/25/economy/us-economy-gdp-second-quarter/index.html

https://www.mediamatters.org/heritage-foundation/jd-vance-wrote-foreword-book-project-2025-architect-kevin-roberts-and-proceeds

https://www.newsweek.com/donald-trump-might-not-shot-1930037

https://people.com/was-trump-struck-by-bullet-or-shrapnel-fbi-director-testifies-8683340

https://www.msnbc.com/rachel-maddow-show/maddowblog/trump-wants-fbi-director-resign-immediately-chris-wray-rcna163641