Voluntary Or Compulsory? Unilever's Climate Goal Outlook

In the past decade, the world has witnessed a surge in corporate climate pledges. 

More than 10,000 companies have made commitments or targets with the Science Based Targets initiative.

However, global emissions continue to rise and could expand an additional 30% this decade according to McKinsey & Co.

Reporting from Bloomberg Businessweek examined companies pulling back from climate pledges and how this could get people thinking about the impact of voluntary corporate action.

Downsizing in climate targets

Businesses have pulled back climate targets across sectors. 

Some major corporations across various industries have walked back their climate targets, including:

• bp increased oil drilling while cutting back on renewable investment
• Coca-Cola and PepsiCo weakened plastic reduction goals set in 2021
• Wells Fargo and HSBC diluted their emissions-reduction strategies
• Walmart acknowledged delays in meeting climate milestones.

“I am heartened by the alacrity of the retreat and the ferociousness of it, because I think it uncovers the reality that we all need to understand, which is companies aren’t going to save the planet,” Ken Pucker, a Professor at Tufts University’s Fletcher School of Law & Diplomacy, told Bloomberg.

“The quicker that people understand and integrate that, the better.”

The cost of decarbonisation

Many sustainability projects, like LED upgrades and rooftop solar installations, can pay off quickly. 

However, significant decarbonisation can demand far more capital-intensive measures, such as retiring fossil fuel infrastructure or switching to low-carbon, green materials. 

“I would happily spend the rest of my life changing lightbulbs and retrofitting buildings,” Auden Schendler, previously SVP Sustainability at Aspen One, told Bloomberg.

“It’s incredibly gratifying, it saves money, it reduces pollution, it makes buildings run better.

"But here’s the only problem: It’s not a solution to the climate problem.”

Is voluntary action enough?

The failure of voluntary corporate efforts may show that without regulation, meaningful progress is unlikely. 

Trade associations and lobbying can be used by companies to resist climate action, Bloomberg reported.

Some airlines resist mandates on SAF despite committing to net zero goals and in the EU, ReFuelEU Aviation Regulation has been set up to combat this. 

Bloomberg reports that trade associations often lobby against environmental policies even when individual member companies publicly support climate goals. 

Unilever, however, does not follow this trend, instead choosing to assess the climate stance of its trade groups and discloses misalignments, pledging to withdraw if necessary.

Politics over pollution

Lobbying for laws that level the playing field can enable first movers to avoid market disadvantages. 

Climate-focused organisations like ClimateVoice are encouraging employees to push from within, urging companies to support effective climate policies. 

This bottom-up pressure has the potential to counteract corporate inaction from the top according to Bloomberg.

The climate crisis requires systemic change, and that could be significantly impacted by regulation.