Last week the world celebrated Earth Day.
It was an opportunity for everyone to pledge their allegiance to mother Gaia and promote clean green energy as the wave of the future.
Social media was flooded with Earth Day posts from regular people and celebrities.
Globally, big businesses have pledged money and resources towards a greener future. According to Invesco strategist Brandon Knott, 90% of the world's gross domestic product is on a path toward a "net-zero carbon commitment."
Unfortunately, words don't always match action and if you ask executives, most will tell you that their companies aren't doing enough, according to a new survey.
A recent Harris Poll for Google Cloud survey of 1,491 executives across 16 countries found that while 96% had at least one program in place in the name of a greener future, 58% of executives said that their organization was guilty of greenwashing.
Greenwashing is the practice of marketing a company or organization so they appear more environmentally friendly.
The survey said 65% of respondents wanted to "advance sustainability efforts but don't know how to actually do it." Only 36% said their organizations even have the tools to measure their efforts.
Only 17% are using those measurements to optimize their performance based on the results.
The vision of an environmentally friendly future driven by big business gets bleaker the further you dig into the survey, which was conducted between December 21, 2021 and January 8, 2022.
Shopify Pushes Past Carbon Neutrality
Shopify (SHOP) is one of the companies who have made a pledge to fight for cleaner companies, and they have a diverse approach to getting it done.
The commerce company started gathering data in 2019, starting a carbon accounting program that would lead it onto a path to being carbon neutral.
"Well now that we know much we've emitted to run our business, we want to support projects that counteract our emissions," Stacy Kauk, head of sustainability for Shopify, said.
What are carbon offsets?
The carbon dioxide released into the air can be cancelled out by absorbing an equal amount of carbon from the atmosphere through numerous methods including: forestry and conservation, renewable energy, and converting landfill gas and human and agricultural waste.
Companies that want to offset their carbon emissions can purchase a carbon credit, or a permit, that allows the owner to emit a certain amount of carbon dioxide or other greenhouse gas.
Individuals also can purchase carbon offsets. Some airlines allow flyers to pay a little extra to compensate for the plane's emissions. That's a form of carbon offset.
But even this system is flawed.
"In the voluntary market, there are no rules and regulations around what we need to do to measure and reduce our carbon footprint," Kauk said. "There's guidance out there, but really each individual company can do what they want.
When Shopify first started to figure out how to offset its carbon footprint, they entered a market that was not ready to provide the services necessary.
What they found was that most carbon offsets are "avoided emission offsets" where one company pays another company not to pollute as much as the purchaser did.
"We realized in 2019 that there are not a lot of carbon credits out there that (capture carbon dioxide). We realized that there really wasn't a market for carbon removal, and there wasn't a demand signal there," Kauk said. "We realized that if we want to support projects that actually remove carbon from the atmosphere, then we need to be loud about that. We needed to put out a demand signal that would establish the market for carbon removal."
"That was the genesis of our fund."
Shopify was able to achieve its goal of net carbon neutrality in short order. Now the company wants to pass its mantra onto the sellers that use the platform to ship their wares across the globe.
"What we're looking to do is take all of those lessons learned and insights, and bring those super powers to our merchants. What we want to do is help those businesses powered by Shopify address their climate impact."
Shopify's Diverse Approach to Sustainability
Shopify created its Sustainability Fund in September 2020.
The goal was to pump $5 million annually into projects that remove atmospheric carbon.
But the company has agreed to provide $13.5 million to nine different projects in its latest round of carbon-removal purchases.
Since 2019, Shopify has spent $32 million for carbon-removal projects.
There are 22 companies supported by the fund who are working towards Shopify's goal of finding "innovative ways to move green energy forward."
The Shopify Sustainability Fund features two portfolios. One is the Frontier portfolio. It invests in technologies that permanently remove CO2 from the atmosphere and stores the emissions.
The other is the Evergreen portfolio which features companies that also remove carbon from the atmosphere, but they don't have the storage capacities of other carbon capture technology.
About 200 companies entered Shopify's last procurement round, with nearly half of the 25 leading applicant being formed in the past three years.
One of the more innovative companies the Sustainability Fund is working with is DroneSeed. The company uses drones to drop seeds to reforest areas that have been affected by wildfires.
DroneSeed then sells carbon offsets based on the their reforestation efforts.
In this instance, Shopify is a buyer.
In March, the company purchased carbon offsets from DroneSeed to remove 50,000 tons of carbon from the atmosphere.
"They are using drones and technology to scale reforestation with the objective of mitigating the worst effects of climate change," Kauk said.
