As sustainable investing goes mainstream, Climate Reality Project founder and former U.S. vice-president Al Gore warns that rampant greenwashing risks “derailing hard-won progress” in the fight against global heating.
“There remains a yawning gap between long-term climate goals and near-term action plans,” Gore told Bloomberg Green. The former VP is currently chair of Generation Investment Management, which has just released its own analysis of the world’s shift to sustainability over the past five years.
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Citing data from national consumer protection authorities, the report authors “estimate that 42% of environmental claims have been ‘exaggerated, false, or deceptive,’ and might even violate fair practice rules established by the European Union,” writes Bloomberg. Further, about 53% of the 159 companies tracked by Climate Action 100+ “don’t have appropriate short-term targets for net-zero emissions.”
Generation Investment Management did find good news to report. That included “a 10-fold gain in new investments in environmental, social, and governance funds” around the world since 2015, an eight-fold increase “in sustainable debt issuance, and a doubling of private equity and venture capital deal flow in the areas of sustainability.”
But there is much sombre news, as well. “More than half of the world’s GDP—some US$44 trillion of economic value—is at moderate or severe risk due to nature loss.” And as governments fail to quash greenwashing, consumers end up facing “confusing and misleading claims about the benefits of sustainability”—thus stymying the transition to a low-carbon economy.
“The time for celebrating vague, distant goals on net-zero has long passed,” said Gore. “Investors now need clarity over how companies will turn goals into actions.”