World’s biggest carbon-emissions cutters — including CP Rail — also made money, new report finds

Some of the world’s biggest emitters of carbon have quietly achieved massive reductions in emissions over the past decade, holding out promise that the global transition necessary to avoid the worst effects of climate change is possible.

A report published Wednesday by ethical business research group Corporate Knights ranks the top 20 companies in the world by carbon-emissions reductions and shows that some of the biggest polluters have slashed their emissions by half or more — while also increasing their revenues.

“This shows it’s possible that big polluters can move fast, at the scale and speed needed,” said Toby Heaps, CEO and co-founder of Corporate Knights. “It’s in line with what we all need to do this decade and next to meet the Paris Agreement targets and avoid warming beyond 1.5 degrees.”

“If they can do it, anyone can.”

The companies on the Carbon Reduction 20 list reduced their reported emissions by a total of 43 per cent, or 489 million tonnes, from 2012 to 2021. That’s almost three-quarters of all the greenhouse-gas emissions in Canada.

The only Canadian company on the list is Canadian Pacific Railway, which came in at number 19.

The list is dominated by large electricity utilities and oil and gas companies, and the methods they used to cut emissions differ greatly. Among the utilities, reductions were driven by a combination of retiring coal generation and expanding renewables. In the oil and gas sector, emissions were reduced through divestment and a reduction in barrels of oil produced.

Across the board, however, more than half of the reductions are “real,” said Heaps, because they came from shutting down carbon intensive facilities and reducing emissions elsewhere. About 40 per cent of reductions are “perceived” because they came from selling off polluting assets, Heaps said, a technique that gets emissions off the company’s books but does not actually eliminate them from the atmosphere.

Enel, an Italian electricity utility, topped the list by reducing its emissions by 73 million tonnes, or 57 per cent.

According to Heaps, the company did a U-turn when Francesco Starace was appointed CEO in 2014. Since then, the company has shut down almost all of its coal plants without any layoffs and, until the recent dive in the stock markets, doubled its market value.

“They had huge cuts to emissions, no job loss and investors love them,” Heaps said. “It’s pure upside.”

CP Rail, Canada’s sole company to make the list, cut almost 500,000 tonnes of carbon from its annual emissions, down 14 per cent over the last decade. In that same time frame, CP’s stock price has increased sixfold. According to the analysis, the reductions came overwhelmingly from energy efficiency.

While Enel and CP show that a commitment to going green can be a win for the Earth and for investors, not all the companies on the list fit that profile, said Heaps.

“I was expecting to find companies that had gone all in on their climate efforts by reducing carbon and investing heavily in renewables. But I was surprised that they weren’t all companies that have really committed to going green,” said Heaps.

The report measured the sustainable investments of the companies and found that they spent less money on reducing emissions than they did on executive pay, share buybacks and dividends.

“The European oil majors talk a big game, but the way they spend their money doesn’t back that up,” he said.

Last year, British oil giant BP spent $2.2 billion (all figures U.S.) on sustainability and $7.5 billion on buybacks, dividends and executives. Dutch petroleum conglomerate Shell spent $700 million on emission reductions and $9.4 billion on payouts for stakeholders, while French fossil fuel multinational Total spent $2.9 billion and $10 billion, respectively.

“These leaders are still not putting major investments in renewables,” said Heaps. “And these are the leaders. Even for companies making big progress on emission reductions, sustainability still isn’t a priority.”

“We need companies to go all in and devote more free cash to solutions.”

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