Behind the Headlines on Net-Zero and Carbon Reduction Pledges

To what degree is optimism warranted?

Glass office buildings surrounded closely by bright green leaves
Topic
Social Impact
Author
Katie Gilbert
Published

The International Energy Agency made headlines and sparked hope last week with an optimistic statement via Twitter: “New IEA analysis shows that fully achieving all net zero pledges to date and the Global Methane Pledge by those who signed it would limit global warming to 1.8C.”

Shivaram Rajgopal, professor of accounting and auditing at Columbia Business School, is skeptical that the collective commitments made so far really add up to something quite that significant. Practically speaking, he’s concerned about how long-term commitments will be upheld by future leaders in the countries around the world that are eagerly making them today—especially in the absence of an oversight body designed to track the incremental progress toward climate pledges and hold governments accountable.

Rajgopal’s skepticism may have been partially primed by his current research, an ongoing project in which he is analyzing the credibility of the emissions reductions pledges of US oil and gas companies. Overall, preliminary data indicates that these oil and gas majors’ commitments lack standardization, specifics regarding implementation, and, perhaps most importantly, dedicated funding.

Of the 41 US oil and gas firms that Rajgopal is tracking, 20 have made net-zero commitments (pledging to ensure that carbon emissions equal no more than carbon removed from the atmosphere) and 21 have promised to simply reduce emissions.

Of those who have made these commitments, three have not yet published a sustainability report. Only about half of them target a specific year in their pledges, and those years vary from 2025 to 2050. And a mere seven of the oil and gas firms on Rajgopal’s list have earmarked any capital for low-carbon or decarbonization initiatives.

“Headlines about net-zero commitments sound great,” Rajgopal says. “But once you unpack the headlines, you get a whole can of worms.”

How do these early findings relate to the government climate pledges coming out of COP26? Rajgopal says that in the absence of the type of oversight body he wishes could be formed, it’ll be incumbent on nonprofits and other watchdogs to unpack the pledges and examine the “can of worms” inside commitments one by one, as he has begun to do with the climate promises of the US oil and gas industry.

And when governments haven’t promised transparency around incremental progress toward these goals, it will be up to the public to demand it.

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