The Australian Competition and Consumer Commission (ACCC) has unveiled a set of eight principles designed to assist businesses in ensuring the transparency and accuracy of environmental marketing and advertising claims. These guidelines, presented as the ACCC's final guidance on environmental claims, elucidate what the Commission deems as good practice in making such claims while enlightening businesses about their obligations under the Australian Consumer Law.
They aim to facilitate clearer, evidence-backed environmental assertions, enabling consumers to make informed choices. Addressing the complexity of such claims, the ACCC urges businesses to communicate technical information effectively.
The eight key principles are:
- Make accurate and truthful claims.
- Have evidence to back up your claims.
- Don't hide or omit important information.
- Explain any conditions or qualifications on your claims.
- Avoid broad and unqualified claims.
- Use clear and easy-to-understand language.
- Visual elements should not give the wrong impression.
- Be direct and open about your sustainability transition.
By fostering trust and understanding among consumers, these principles not only assist in purchasing decisions but also incentivize fair competition based on genuine environmental efforts. Acknowledging the importance of businesses driving sustainability, the ACCC encourages legitimate marketing of eco-friendly practices.
Updapt Views:
The ACCC's introduction of eight principles for clear and accurate environmental marketing claims is critical in the business landscape. It will mitigates the issue of misleading environmental assertions, aligning with the ACCC's enforcement and compliance priorities. By setting guidelines for transparency and accuracy, businesses will be equipped to build and maintain consumer trust, addressing the prevalent challenge of skepticism surrounding green claims.
European Parliament and Council lawmakers have officially reached a provisional agreement on the EU's Corporate Sustainability Due Diligence Directive (CSDDD). The directive mandates that major businesses assess and rectify adverse human rights and environmental impacts within their value chains. The accord, stemming from the European Commission's proposed CSDDD, imposes obligations on companies to identify, assess, prevent, and remedy impacts spanning child labor, pollution, and deforestation in both upstream and downstream activities.
It will be Applicable to EU firms with over 500 employees and €150 million in global revenues, the directive extends to non-EU companies with €300 million net revenue generated in the EU after a three-year grace period.The directive necessitates integrated due diligence in policies and risk management systems, compelling alignment with the Paris Agreement's 1.5°C warming limit.
The directive also mandates companies to engage with affected parties, introducing a 5-year complaint mechanism. To ensure compliance, member states will establish supervisory authorities with powers to impose penalties, including fines up to 5% of annual global revenue. Pending formal approval by the EU Council and Parliament, the CSDDD is poised to enact positive change.
Updapt Views:
The Corporate Sustainability Due Diligence Directive heralds a new era of corporate accountability, fostering ethical practices and a fairer economy. Its broad reach across major EU and non-EU companies promotes responsible conduct, engaging stakeholders and aligning business strategies with climate goals. This mandate ensures transparency in value chains and introduces penalties, signifying a stringent enforcement mechanism.
The Dutch Central Bank (DNB) unveiled a bold initiative to synchronize its reserves, encompassing equities and corporate bonds, with the pivotal goals of the Paris Agreement. In a resounding commitment, the DNB aims to halve the carbon footprint of its portfolio investments by 2030, benchmarked against 2019 levels. This endeavor underscores a fervent dedication to effecting tangible emissions reductions across its portfolio companies.
Aligned with the European Union's resolute stance on curbing global warming, DNB delineated a three-pronged strategy: 'Invest' in companies with lower carbon emissions or explicit emission reduction plans, "Engage" through dialogues with companies and fund managers to influence positive climate-related actions, and 'Avoid' investments in entities significantly reliant on fossil fuel activities, disregarding the Paris Climate Agreement or involved in controversial sectors.
Emphasizing an annual evaluation, DNB remains committed to ensuring that reductions in its portfolio's carbon footprint are a result of authentic emissions curtailment at investee companies, aligning with their pursuit of genuine, real-world carbon reductions.
Updapt Views:
By mitigating climate risks, enhancing resilience, and fostering a reputation for sustainability, companies position themselves for long-term success. The three-pronged strategy ensures leadership in sustainable finance, attracting socially responsible investors and maintaining a competitive edge. Annual evaluations reaffirm authenticity in emissions reductions, aligning with global climate goals and regulatory standards.
The Monetary Authority of Singapore (MAS) introduced the groundbreaking Singapore-Asia Taxonomy for Sustainable Finance during the COP28 climate conference. Notably, this taxonomy is the world's first to comprehensively define green and transition activities across eight key sectors: energy, industrial, carbon capture and sequestration, agriculture and forestry, construction and real estate, waste and circular economy, information and communications technology, and transportation. Employing a "traffic light" system, it classifies activities as green (sustainable), amber (transition), or ineligible based on their contribution to environmental objectives.
One distinctive feature is the introduction of the "amber" category for transition activities, aligning with Asia's shift to a net-zero economy amid economic development. The taxonomy includes time-bound, sunset-date transition thresholds, discouraging prolonged reliance on non-sustainable practices and reducing the risk of greenwashing.
The taxonomy facilitates a measured transition process, crucial for hard-to-abate sectors like the maritime industry. Additionally, it addresses the transition from coal-fired power plants, filling an international gap and providing criteria for responsible and fair coal phase-out. The MAS is actively engaging in sustainable finance initiatives, including partnerships to address climate finance gaps and a blended finance platform focusing on energy transition.
The Singapore-Asia Taxonomy's industry-led, science-based approach and interoperability with major taxonomies demonstrate its potential to promote the green economy in Singapore and Southeast Asia. Future versions are planned to cover additional environmental objectives. The MAS is mapping the taxonomy to the Common Ground Taxonomy for global interoperability, aligning it with the EU Taxonomy and China's Green Bond Endorsed Project Catalogue. This mapping will enable consistent definitions, facilitating cross-border financing flows and taxonomy-aligned financing solutions.
Updapt Views:
The Singapore-Asia Taxonomy empowers businesses by offering transparency, mitigating risks, and aligning with global ESG standards. It enables access to sustainable finance, reducing capital costs, and enhancing financial performance. Particularly beneficial for hard-to-abate sectors, its clear classification facilitates smoother transitions towards sustainable practices, fostering accountability and attracting responsible investments.
The COP 28 marked a pivotal moment in the global fight against climate change, with far-reaching agreements and pledges. Central to the discussions was the Global Stocktake (GST), outlining eight crucial steps to limit the temperature increase to 1.5 degrees Celsius. Among these steps are the call to triple global renewable energy capacity and double the rate of energy efficiency improvements by 2030.
COP 28 emphasized a just transition away from fossil fuels, aiming for a net-zero scenario by 2050. The Global Goal on Adaptation (GGA) took center stage, seeking to enhance adaptive capabilities and double adaptation finance. Notably, explicit 2030 targets were integrated for water security, ecosystem restoration, and health.
Climate finance discussions unveiled a commitment to address the debt disparity between wealthy and developing nations, aiming to set a new collective quantified goal by 2025. The Loss and Damage Fund, operationalized at COP 28, will compensate countries grappling with climate impacts, with special consideration for the most vulnerable.
The Global Renewables and Energy Efficiency Pledge urges signatories to work collaboratively towards tripling the world's installed renewable energy generation capacity to a staggering 11,000 GW by 2030. Simultaneously, the pledge targets a collective doubling of the global average annual rate of energy efficiency improvements from around 2% to over 4% every year until 2030.
The Global Cooling Pledge, with 66 national government signatories, lays out a data-backed plan to reduce cooling-related emissions by at least 68% globally by 2050 relative to 2022 levels. Another declaration launched at COP 28 seeks to triple global nuclear energy capacity by 2050, emphasizing the role of nuclear energy in the broader climate action agenda.
Updapt Views:
COP28 outcomes offer businesses unprecedented prospects. Opportunities abound in renewable energy expansion, energy-efficient technologies, and transitioning from fossil fuels. Increased demand for adaptation solutions creates openings for resilient infrastructure and disaster management industries. Embracing these shifts positions businesses at the forefront of sustainable innovation and growth.
