In addition to the energy industry, the financial industry also plays a key role in the global effort to achieve net-zero carbon reduction.
At the Cathay Capital Holdings' "Cathay Sustainable Finance and Climate Change Summit" held on March 3, Eugene Chien, Chairman of the Taiwan Sustainable Energy Research Foundation, highlighted that enterprises have begun to be severely scrutinized for their ESG practices. More stringent laws and regulations will be put in place in the future to prevent "greenwashing" behaviors.
According to the latest Global Sustainable Investment Survey released by the Global Sustainable Investment Alliance (GSIA), the overall sustainable investment in the world's major countries has exceeded US$30 trillion, which is a huge amount of money. However, the resources have not been placed in the right position.
Take the US as an example, half of all sustainable investment projects have been eliminated in recent years, not because of a slowdown in investment momentum, but because the US has introduced a clearer definition of sustainable financial investment and more stringent regulations. This has led to at least half of the fish-eye investment projects being recognized as such.
In the future, the international definition and regulation of sustainability will only become stricter and clearer, and the external examination of enterprises will become more and more stringent, which is a point that all enterprises need to pay careful attention to when carrying out sustainable development and investment.
This is a point that all enterprises need to pay careful attention to when making sustainable development and investment. In the future, there are bound to be controversies and challenges of greenwashing, and if they step on the red line, they will need to spend more efforts and sincerity to win back the trust of the society.
Greenwashing can be divided into unintentional and intentional behavior. The former is mostly because global discussions on sustainable development have not been held for a long time, and as a result, industries are still in the process of figuring out how to do it.
The United Nations campaign against greenwashing is strongly supported by the US and the European Union, which will be held legally accountable in the future. Therefore, if Taiwanese companies claim to export green and environmentally friendly products to Europe and the US in the future, they need to provide relevant proof, or else they will be subject to lawsuits.
One example is Delta Air Lines, which was sued for going green, announcing in February 2020 that it was going to invest in the project, but in January it was discovered that it had already claimed to be the world's first carbon-neutral airline. Delta relies on "junk carbon" offsets, which have no real carbon reduction benefits, to give consumers the false impression that they are not emitting any carbon if they travel with them.
In recent years, many low-quality carbon offset programs have been reported to be ineffective and involve greenwashing. The first batch of carbon rights in Taiwan will be on the shelves by the end of 2023, and the Ministry of the Environment has also emphasized that it will set recognition criteria for foreign carbon rights, and only recognized carbon rights will be allowed to offset carbon fees.
With the emergence of greenwash, it may become the next resistance to ESG promotion. For example, in recent years, there has been a wave of "anti-ESG" in the US, which has not only become a tool for political struggles but has also been questioned as a means of resisting competitors or preventing the entry of new companies into the market, which is related to antitrust laws.
Chien emphasized that the ESG headwinds are only a small part of the problem and there are different voices, but overall it is still an international consensus.
