Automotive Among Industries Targeted For Greenwashing By European Group

When a company overstates its moves to protect the environment that’s called greenwashing. A symposium on the subject held in Venice, Italy on Friday convened to discuss the practice and ways of combating it. But one of the symposium’s chief organizers also warns it’s much more than cases of unjustified corporate bragging—greenwashing is growing and it’s dangerous.

“It’s dangerous because it is deceiving the final consumer, it is creating cases of unfair competition and is diverting an important flow of investments initially intended to be directed to sustainable corporate activity and then (lead to) activity not sustainable,” said Andrea Boragno, chairman and CEO of automotive supplier Alcantara, a lead organizer of the symposium, in an interview with Forbes.com.

The Milan, Italy-based company, which produces material for a number of industries, including automotive, is one of the first companies in Europe to earn a carbon-neutral certification.

While the automotive industry was not the sole focus of the symposium, it stands accused of greenwashing to different degrees.

Indeed announcements by various automakers about vastly ramping up production of electric vehicles or setting goals to transition to powering their facilities with renewable energy sources are considered by some as positive moves, but also shiny objects to deflect attention from their overall impact on the environment.

“The overall carbon footprint of an automaker is 80% use of product unless you’re a Tesla

TSLA
, assuming you’re plugging in your Tesla to renewable energy,” said symposium participant Timothy Nixon in an interview. Nixon is CEO at Signal Climate Analytics. “It’s great they’re doing that and hopefully that provides an incentive for others to do it, but that’s not really where the sweet spot is on climate leadership.”

The sweet spot, Nixon said, is measuring the actual climate impact from the use of the products.

A key metric is what’s categorized as Scope 3 emissions by the international Greenhouse Gas (GHG) Protocol. Those are emissions created by sources not directly under the automaker or supplier’s control including use of the product after it’s sold. Scope 3 emissions is a statistic that can be manipulated to paint a more flattering picture of an automaker’s impact on the environment.

Nixon compared the Scope 3 numbers reported by two automakers that produce about the same number of vehicles annually. Despite their production parity, one automaker’s Scope 3 numbers are much higher, which would ostensibly give consumers the message the auto company with the lower number’s products are producing fewer emissions.

But that’s fun with numbers. Nixon says a data point most automakers do not report is “the underlying performance per kilometer traveled and greenhouse emissions released per kilometer— this key metric of the carbon intensity of the product.”

When that data is considered vehicles built by the company with the higher Scope 3 number outperform the vehicles produced by the automaker with the lower Scope 3 number.

How is that possible?

“Currently it’s the automakers themselves that get to decide how long their cars last on average and how far they’re driven every year,” explained Nixon. “I don’t think it’s necessarily that they’re lying to market place, it’s simply a different way of looking at that number that’s not regulated. I’m not sure I’d call it greenwashing, it’s marketing. It’s taking data it has available, looking at its marketplace and saying this is our level of performance.”

Another troubling aspect of the issue, especially in Europe, is the lack of clear guidelines for determining how much recyclable polyethylene terephthalate (PET) is actually in any plastic or textile product used by the fashion or auto industries. It opens the door to a company, possibly unwittingly, heralding its use of recycled plastic as evidence of its sustainability efforts, when the item may actually contain very little recycled content.

“I don’t say the automotive sector is somehow lying or undermining reality. What I think is happening is it’s quite difficult to have a scientific discussion that has taken on an emotional basis. What we are missing is a clear definition of recycling content is a clear methodology to assert. Somehow we need legislation to sanction these fraudulent declarations. Be sure what’s been declared is true. If not true, it should be sanctioned,” said Antonello Ciotti, Chairman of the Committee of PET Manufacturers in Europe and director of Equipolymers, one of the largest PET producers in the European Union, in an interview.

Alcantara’s Boragno says his company is doing its best to avoid the issue by what he describes as “responsible procurement. We cannot give the problem to somebody else. We consider from cradle to the grave our production process.”

Alcantara’s carbon neutrality certification is a fact. But symposiums such as the one just concluded in Venice and others looking into the issues are focused on closing the loopholes that allow for manipulation or cherry picking data and the lack of clear definitions regarding recycled plastics and punishing companies in an array of industry that use greenwashing to launder their sustainability shortcomings.