Net Zero: How Far Have We Really Come?

Fossil fuel companies have long been recognized as major contributors to the climate crisis. Their operations, including extraction, refining, and distribution of fossil fuels, have led to unprecedented levels of carbon dioxide and other pollutants in the atmosphere, exacerbating global warming. Despite mounting evidence and calls for action, these corporations have often prioritized short-term profit over long-term environmental sustainability.

In response to growing pressure from stakeholders and the public, corporations have begun to adopt “net zero” emissions strategies as a purported solution to the climate crisis. The concept of net zero involves balancing the amount of greenhouse gases emitted and the amount removed from the atmosphere, typically through carbon removal techniques such as planting trees in an unforested area.

However, the emergence of net zero emissions strategies has raised important questions. Are these pledges truly delivering on their promise to mitigate climate change, or are they merely a smokescreen to deflect attention from the fossil fuel industry’s continued contributions to global warming?

The Limits of Net Zero Initiatives

Offset projects have even been found to exacerbate environmental problems, such as deforestation or land grabbing, particularly in vulnerable communities.A key component of many net zero strategies is using carbon offsets—particularly tree-planting initiatives—allowing companies to balance emissions by investing in projects that purportedly remove or sequester an equivalent amount of carbon dioxide from the atmosphere. In actuality, it is far more complex, and the effectiveness of carbon offsets in achieving meaningful emissions reductions is highly questionable.

While trees can absorb carbon dioxide from the atmosphere, they have limitations. The long-term carbon storage capacity of forests is uncertain, as trees can release back the carbon stored through processes such as decay or deforestation. Other disturbances like wildfires, insect infestations, and disease outbreaks can also impact the amount of carbon stored and emitted. For example, the world has in recent years witnessed significant deforestation and devastating wildfires in regions such as the Amazon rainforest and Australia. The razing of those trees has released vast amounts of stored carbon back into the atmosphere.

Carbon offsets also raise issues of additionality—whether the emissions reductions claimed by offset projects would have occurred anyway, even without the offset funding—and leakage, which occurs when emissions reductions in one location increase emissions elsewhere, negating the overall impact.

In practice, the effectiveness of carbon offsets in delivering real emissions reductions is often overstated. Numerous studies have highlighted the shortcomings of offset projects, repeatedly finding that many projects fail to provide the promised environmental benefits. In some cases, offset projects have even been found to exacerbate environmental problems, such as deforestation or land grabbing, particularly in vulnerable communities.

Verifying and monitoring emissions reductions is a difficult, costly task, often due to the sheer scale and remoteness of project locations, further complicated by the fact that forests vary widely in their carbon storage capacity. Agriculture, grazing, or development can make accurately counting emissions reductions more challenging.

And while recent developments in technology have improved emissions monitoring, the lack of standardized protocols coupled with limited capacity and resources pose ongoing barriers to effective monitoring and verification. Insufficient standards and oversight in the voluntary carbon market have further enabled the misrepresentation of emission reduction claims.

Achieving carbon neutrality through offsets can allow companies to continue business as usual and avoid implementing more effective measures to decarbonize their operations and supply chains. This perpetuates the cycle of reliance on fossil fuels and undermines efforts to transition to a truly sustainable economy.

Burn Now, Pay Later

Climate scientists James Dyke, Bob Watson, and Wolfgang Knorr argue that the reliance on future technological fixes, such as carbon offsetting, perpetuates a dangerous “burn now, pay later” approach.

By deferring present-day emissions reductions in favor of unproven solutions, net zero initiatives effectively provide a blank check for the continued burning of fossil fuels and habitat destruction. Dyke, Watson, and Knorr highlight in the Conversation the failure of previous climate policies and warn that current net zero policies are driven more by a desire to protect business interests than a genuine commitment to climate action.

In a report from the Canadian Centre for Policy Alternatives, economist Marc Lee echoes these concerns, describing net zero as a potential distraction that weakens political pressure to reduce emissions. He argues that a net zero target provides an “escape hatch” for business as usual.

Various experts and organizations have also called into question the credibility of net zero claims. At the 2022 United Nations Climate Change Conference (COP27), the High-Level Expert Group on the Net Zero Emissions Commitments of Non-State Entities released a report highlighting the prevalence of greenwashing among corporations, local and regional governments, and financial institutions. The report emphasized the need for greater transparency and accountability in carbon neutrality pledges, urging verifiable information to substantiate claims.

After the report’s release, a research consortium called the Net Zero Tracker issued a response evaluating the climate neutrality pledges of governments and companies worldwide. The findings revealed that many of these pledges were largely unsubstantiated. Despite the growing number of net zero commitments, many lack binding regulations and enforcement mechanisms.

Environmental advocates, including Tzeporah Berman, chair of the Fossil Fuel Non-Proliferation Treaty Initiative, have criticized fossil fuel companies’ net zero claims as “delusional and based on bad science.”

Misrepresentation and Lawsuits

In 2024, New York Attorney General Letitia James filed legal action against JBS USA Food Company, alleging that the American subsidiary of the world’s largest beef producer misled the public about its environmental impact. The lawsuit alleges that JBS USA engaged in greenwashing by asserting that it would achieve net zero greenhouse gas emissions by 2040. This contradicts the company’s documented plans to increase production, escalating its carbon footprint.

James stated, “When companies falsely advertise their commitment to sustainability, they are misleading consumers and endangering our planet. JBS USA’s greenwashing exploits the pocketbooks of everyday Americans and the promise of a healthy planet for future generations.”

The lawsuit revealed that the company had not accurately calculated its total greenhouse gas emissions, creating more doubts about the feasibility of achieving net zero emissions by 2040.

In prioritizing profits over environmental and social considerations, financial institutions deepen existing disparities and perpetuate systems of oppression.

And an ongoing civil suit alleges that Delta Airlines engaged in false and misleading advertising practices regarding its claim of carbon neutrality.

This lawsuit can be traced back to Delta’s declaration in 2020 that it was committed to achieving carbon neutrality, branding itself as “the world’s first carbon-neutral airline.” The suit contends that Delta’s assertion is deceptive and unfounded due to the alleged ineffective nature of the carbon offsets employed by the airline. Delta’s extensive promotional efforts have positioned the company as an environmentally responsible airline, purportedly misleading consumers into purchasing tickets under false pretenses and exploiting consumer concerns about climate change and sustainability.

The Role of the Finance Industry

The finance sector’s engagement in the net zero movement is a largely symbolic gesture toward fighting global climate change. Major banks like JP Morgan Chase and Goldman Sachs have announced ambitious plans to finance renewable energy projects and transition away from fossil fuels. Similarly, asset managers like BlackRock have touted their support for sustainability and climate-conscious investing.

But these institutions and many others continue to make significant investments in fossil fuel industries. JP Morgan Chase has been one of the world’s biggest funders of fossil fuels despite pledging to support the transition to a low-carbon economy. BlackRock has maintained its substantial holdings in fossil fuel companies. And Goldman Sachs, despite pledging to achieve net zero emissions by 2050, continues to underwrite fossil fuel projects that emit greenhouse gases beyond that deadline.

The gap between rhetoric and action in the finance industry erodes trust in the financial sector’s ability to drive meaningful climate action; hinders progress toward achieving global climate targets; and perpetuates social and economic inequalities, particularly in marginalized communities.

Achieving genuine emissions reductions requires a commitment to environmental justice and equity.

Coal mining operations, for example, often occur in regions already grappling with poverty and environmental injustice. As Zane McNeill wrote in NPQ, this leads to further displacement, health disparities, and economic exploitation. In prioritizing profits over environmental and social considerations, financial institutions deepen existing inequalities and perpetuate systems of oppression.

Toward Genuine Climate Action

To address the climate crisis effectively, it is essential to prioritize transparency and accountability in climate action efforts. Companies and governments need to accurately measure, report, and verify their emissions reductions rather than rely on vague pledges. In addition, there must be mechanisms in place to hold accountable those who fail to meet their commitments or engage in deceptive practices.

While net zero emissions strategies may offer a temporary reprieve, they ultimately fail to address the root causes of climate change. Genuine emissions reductions require transformative action across all sectors of the economy, including energy, transportation, and agriculture. This necessitates shifting from fossil fuels to renewable energy sources and making investments in energy efficiency, conservation, and sustainable land use practices.

Moreover, achieving genuine emissions reductions requires a commitment to environmental justice and equity. Poorer communities and communities of color bear the brunt of environmental pollution and climate impacts. Any climate action strategy must prioritize the needs and rights of these communities, ensuring that they have access to clean air, clean water, and resilient infrastructure.

All stakeholders, from journalists and civil society organizations to policymakers and consumers, need to challenge net zero narratives and demand accountability from corporate and financial actors. Real climate action requires moving beyond the illusion of net zero and toward a paradigm of transparency, accountability, and meaningful emissions reductions.