Business Pollution: What's Their Contribution To Environmental Degradation?

Businesses and corporations are responsible for a significant proportion of global pollution. A 2017 report by the Carbon Disclosure Project revealed that just 100 companies were responsible for 71% of global GHG emissions since 1998. Fossil fuel companies, in particular, have contributed immensely to climate change, with ExxonMobil, Shell, BP, and Chevron identified as among the highest-emitting investor-owned companies. The transportation sector, including cars, trucks, ships, trains, and planes, is another major source of pollution, with over 94% of the fuel used derived from petroleum. Additionally, the fashion industry is the second-biggest industrial polluter, contributing about 10% of global emissions. While consumers are often encouraged to make sustainable choices, corporations have a more significant responsibility to transition to greener practices and reduce their environmental impact.

100 companies are responsible for 71% of global emissions

The Carbon Disclosure Project (CDP) report, published in 2017, revealed that 100 companies have been responsible for 71% of global greenhouse gas emissions since 1988. The report, compiled from a database of publicly available emissions figures, highlights the role companies and investors could play in tackling climate change. It is worth noting that the figure of 71% includes scope 3 emissions, meaning fossil fuel producers are held accountable for all emissions from extraction to use and combustion.

The study found that more than half of global industrial emissions since 1988, the year the Intergovernmental Panel on Climate Change (IPCC) was established, can be traced to just 25 corporate and state-owned entities. ExxonMobil, Shell, BP, and Chevron are among the highest-emitting investor-owned companies during this period. The scale of historical emissions associated with these fossil fuel producers is large enough to have significantly contributed to climate change, according to the report.

The report also revealed that 32% of emissions come from public investor-owned companies, highlighting the significant responsibility of investors to engage with carbon majors and push for transparency and disclosure of climate risks. A fifth of global industrial greenhouse gas emissions are backed by public investment, according to the report. This underscores the importance of investors moving away from fossil fuels and towards clean energy sources.

The fashion industry is another significant contributor to climate change, responsible for 10% of global emissions. However, the blame is often placed on consumers, particularly those from working-class backgrounds who may lack the financial means to choose sustainable options. While individual choices, such as buying green products, using public transportation, or adopting a plant-based diet, can make a difference, systemic change is also crucial.

Some large corporations are supporting the transition to a carbon-free economy, with companies like Apple, Facebook, Google, and Ikea committing to obtaining 100% renewable energy. However, many other corporations remain ignorant of their impact on the planet, prioritizing profits over environmental sustainability.

Fossil fuel companies risk wasting trillions by pursuing coal, oil and gas

While it is challenging to determine the exact percentage of pollution caused by businesses, a study reveals that just 100 companies, including ExxonMobil, Shell, BP, and Chevron, are responsible for 71% of global greenhouse gas emissions. This indicates that businesses play a significant role in contributing to environmental pollution.

Fossil Fuel Companies Risking Wasting Trillions

Fossil fuel companies are at risk of wasting trillions of dollars by continuing to pursue coal, oil, and gas projects. According to the Carbon Tracker Initiative, these companies could waste up to $2.2 trillion in the next decade. This is due to the decreasing demand for fossil fuels and the increasing focus on limiting climate change and transitioning to clean energy sources.

The report, titled "The $2 Trillion Stranded Assets Danger Zone," highlights the discrepancy between the industry's business-as-usual strategies and the actions required to meet the UN commitment to limit global warming to 2°C. It emphasizes that no new coal mines will be needed, oil demand will peak around 2020, and growth in gas will not meet industry expectations.

The US, Canada, China, Russia, and Australia are among the countries with the highest financial exposure, with potential losses totaling hundreds of billions of dollars. Companies like Royal Dutch Shell, Pemex, Exxon Mobil, and coal mining companies are at the highest risk of losing significant investments.

To avoid wasting capital, fossil fuel companies need to embrace the energy transition and adopt an ex-growth strategy. This involves recognizing the advancements in clean technologies, such as renewables, battery storage, and electric cars, and adapting their business models accordingly.

The Impact on Investors and the Environment

The potential waste of trillions of dollars in uneconomic projects threatens substantially lower investor returns. Investors are urged to engage with carbon majors, understand the emissions associated with their fossil fuel holdings, and consider moving their investments out of fossil fuels.

Additionally, the continued extraction of fossil fuels at the current rate poses a severe threat to the environment. If the rate of extraction remains unchanged, global average temperatures are projected to rise by up to 4°C by the end of the century. This temperature rise is likely to have catastrophic consequences, including substantial species extinction and global food scarcity risks.

In conclusion, fossil fuel companies risk wasting trillions by pursuing coal, oil, and gas projects that are inconsistent with the transition to a low-carbon future. To avoid financial losses and mitigate the environmental impact, companies must align their strategies with international efforts to address climate change and embrace sustainable alternatives.

The fashion industry is the second-biggest industrial polluter

The fashion industry, particularly fast fashion, is the second-biggest industrial polluter, responsible for 10% of global carbon emissions. It is also a major contributor to water pollution, with the dyeing and finishing processes requiring significant water resources. The industry is the second-biggest consumer of water, and an estimated 700 gallons of water are needed to produce a single cotton shirt, while a pair of jeans require 2000 gallons.

The top locations for fast fashion production, including Bangladesh, Cambodia, India, Pakistan, and Vietnam, already have scarce water resources. Yet, the garment industry in Cambodia, for example, accounts for 69% of all toxic discharges, releasing industrial wastewater into landfills. Major brands like Zara, H&M, Primark, Uniqlo, and Mango, among others, often outsource production to low-cost suppliers in these countries, exacerbating the water pollution problem.

The use of synthetic fibres like polyester, nylon, and acrylic, which are non-biodegradable, is also a significant issue. These materials contribute to around 35% of global microplastic pollution in oceans, as they can take hundreds of years to biodegrade. The fast fashion industry generates about 92 million tons of waste annually, and an average American buys around 68 pieces of clothing per year, a significant increase from the 12 pieces purchased on average in the 1980s.

While consumers are often encouraged to make sustainable choices, such as buying green products or using public transport, these options are often more expensive and may not be accessible to everyone. Corporations, therefore, need to be held accountable for their large part in the climate crisis and should transition to greener and more sustainable practices.

ExxonMobil, Shell, BP and Chevron are among the highest-emitting companies

According to a 2015 Carbon Tracker study, fossil fuel companies risk wasting trillions of dollars by continuing to invest in oil, coal, and gas projects. These investments are likely to become worthless due to international climate change action and the growing popularity of renewable energy sources. The study also highlights the role of investors in encouraging fossil fuel producers to be more transparent about their emissions and environmental impact.

ExxonMobil, Shell, BP, and Chevron are among the highest-emitting companies. These companies have contributed significantly to global greenhouse gas emissions and planetary warming over the past century through their oil and gas products. Their fossil fuel-based business models need to undergo a profound transformation to achieve the goal of decarbonizing the global economy by mid-century and averting dangerous climate change.

ExxonMobil, one of the top-ranking emitters among investor-owned energy majors, has been criticized for its resistance to reducing emissions from hydrocarbon development. The company has rejected the notion that individual companies need to decrease production to align with the Paris Agreement's temperature rise goals, arguing that the energy transition is related to society's demand rather than supply. ExxonMobil has also been accused of being aware of climate change for decades while blocking measures to reduce emissions.

Shell and BP, the two European majors in the group, have made stronger statements acknowledging the contribution of fossil fuels to climate change. However, they have been criticized for their continued exploration and production of fossil fuels, with BP engaging in new exploration as recently as 2020. Chevron, one of the American majors, has rejected the idea that its assets might become stranded due to climate change and has focused on becoming one of the most efficient producers.

While these companies have discussed clean energy and pledged decarbonization strategies, there is a perceived mismatch between their discourse, actions, and investments. The transition to clean energy is hampered by their refusal to commit to reducing fossil fuel production and exploration. As a result, there is a need for an objective evaluation of their decarbonization efforts and investment behavior.

Greenhouse gas emissions from transportation come from burning fossil fuels

Greenhouse gas emissions from transportation come predominantly from burning fossil fuels like gasoline and diesel, which release carbon dioxide (CO2) into the atmosphere. CO2 is the most common greenhouse gas, and its buildup, along with other greenhouse gases such as methane (CH4) and nitrous oxide (N2O), is causing the Earth's atmosphere to warm, leading to the climate change we are witnessing today.

The transportation sector is the largest source of direct greenhouse gas emissions in the United States, contributing about 28% of total US greenhouse gas emissions. This makes transportation the top contributor to US greenhouse gas emissions, even surpassing the electric power sector. From 1990 to 2022, greenhouse gas emissions in the transportation sector increased more than any other sector.

The primary sources of these emissions are cars, trucks, ships, trains, and planes. Over 94% of the fuel used in transportation is petroleum-based, which includes gasoline and diesel, resulting in direct emissions. The dominance of petroleum as a fuel source and the value people place on transportation make reducing emissions from this sector particularly challenging.

To address this issue, the US Environmental Protection Agency (EPA) is taking several actions. These include setting GHG emissions and fuel economy standards for vehicles, such as cars, light trucks, and heavy-duty trucks, and working with the Federal Aviation Agency to establish international carbon dioxide emissions standards for aircraft. Additionally, the Renewable Fuel Standard program aims to reduce greenhouse gas emissions by promoting renewable fuels produced from plants, crops, and biomass, as an alternative to burning fossil fuels.

While the focus is often on individual choices and consumer behaviour to tackle climate change, it's important to recognise that just 100 companies are responsible for 71% of global greenhouse gas emissions since 1988. This highlights the significant role and responsibility of corporations and investors in addressing climate change, especially in transitioning to a sustainable and carbon-free economy.

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