Costco and Unilever boost credibility of refillable packaging

Key takeaways:

  • Small brands have found a niche for refillable packaging by selling direct to consumers.
  • Unilever is paying an undisclosed sum to buy Wild, which sells deodorant in refillable containers.
  • Clean Cult’s refill model relies on aluminum bottles and paper cartons lined with aluminum to prevent leaks.

Two upstart consumer products brands that shun single-use plastic in their packaging, Clean Cult and Wild, are in the spotlight after striking deals with Costco and Unilever.

Clean Cult, a New York company that sells plant-based cleaner, soap and detergent in 20-ounce aluminum bottles refilled from paper cartons that are curbside recyclable, is now being stocked in more than 300 Costco stores and on the wholesale club’s website. 

The relationship, disclosed April 9, marks the first time Costco has picked up a brand that uses refillable aluminum packaging. It applies specifically to Clean Cult’s multi-surface cleaner. The bottle is $4.99 and the refill cartons (which handle about three refills) sell for $7.99 — competitive with other products. 

Clean Cult is already sold by pharmacy chain CVS, the world’s biggest retailer Walmart and regional grocery stores such as Albertsons and Harris Teeter, among others.

There are hundreds of small brands leaning into refillable containers, but most sell directly to consumers, said Paul Foulkes-Arellano, founder and principal at consulting firm Circuthon. “Big retailers have struggled with refill,” he said, “so whoever gets it right will get political backing and take an advantage over their competitors.”

Clean Cult’s relationship with Costco could help normalize how consumers think about refillable containers in an affordable way, said Anita Schwartz, founder and principal of Circularity Consulting. 

“Seeing it on shelf also helps people see plastic prevention in action — not just through ‘forever aluminum bottles’ but also with the paper carton refill bottles,” she said. “There are some refill systems at other retailers, but this is plastic free and a differentiator.”

Clean Cult experimented with many different materials and formats before landing on the combination of aluminum and paper, said Ryan Lupberger, CEO of the company he co-founded in 2019. 

For example, when Clean Cult inked its deal with Walmart, the paper cartons were accompanied by glass bottles. It has also tried distributing its product as a dilutable concentrate, which didn’t work for mass market sellers. “Our goal is to slot into existing shelf space in a way that is easy for retailers,” Lupberger said.

Clean Cult has raised more than $45 million in investment capital. It doesn’t disclose sales or employee numbers, but generates more than eight figures in revenue annually, he said. The company sells its products across the U.S. but sees the greatest regional adoption in California, Oregon and Washington state. 

Wild product portfolio.
Wild is a U.K. personal care company that makes deodorant, body wash and lip balm that is sold in refillable containers. Credit: Wild

Details of Unilever’s Wild acquisition

Big brands are struggling with how to embrace reusable packaging, although many have plastics-reduction goals that include the format. Some created refillable containers as part of a pilot project such as TerraCycle’s Loop program, but that initiative is now limited to two markets: France and Japan. That hasn’t deterred Unilever, which is buying reusable packaging expertise with its acquisition in early April of Wild, a U.K. personal care company that makes deodorant, body wash and lip balm that is sold in refillable containers. 

Although Unilever isn’t revealing the terms of its acquisition, reports in recent weeks valued the transaction at approximately $300 million. The Dutch conglomerate is playing up Wild’s formulations, refillable packaging and social-marketing savvy as motivation for the purchase

Cleaning supplies are thought to be one of the top categories in which reuse will find footing, according to research by Closed Loop Partners and the U.S. Plastics Pact.

The post Costco and Unilever boost credibility of refillable packaging appeared first on Trellis.

Why Microsoft is buying carbon credits from a pulp and paper mill

Key takeaways

  • Microsoft has signed a deal for 3.7 million carbon removal credits over a 12-year period
  • Project developer CO280 will generate the credits by capturing emissions from pulp and paper mills
  • Many U.S. mills are situated close to suitable geologic storage reservoirs

Could the pulp and paper industry be transformed into an engine for carbon removal? That’s the tantalizing possibility raised by a deal between Microsoft and CO280, a project developer focused on capturing and storing carbon dioxide emitted from pulp and paper mills.

The tech giant will purchase 3.7 million tons of removal credits from CO280 over a 12-year period, the developer announced today.

The deal follows a smaller contract announced in December with Frontier, a coalition of companies that funds early-stage carbon removal projects. Support from these two heavyweight backers of carbon removal will help CO280 expand an existing pilot retrofit of a Gulf Coast mill to capture around 400,000 tons of carbon dioxide, said Jonathan Rhone, co-founder and CEO of CO280. He would not share a precise price, but said that the credits would cost less than $200 per ton.

The process has the potential to be “carbon negative” because the feedstock used in pulp and paper mills — small-diameter trees and waste biomass from timber operations — contains carbon captured by photosynthesis. Some of that carbon makes its way to the cardboard packaging, tissue and other paper products mills produce, but a majority ends up in “black liquor,” a waste material burned in the mill to generate heat.

CO280 sends the gases from that combustion through a liquid solvent that captures CO2. After a biomass steam boiler heats the solvent to release the CO2, the system pipes the gas around 40 miles to a site where it is stored underground in a geologic reservoir.

The company declined to disclose the precise location of the retrofitted mill.

‘Happy coincidence’

CO280 has more than 10 projects in development, according to Rhone. After the first Gulf Coast project turns on in 2029, he estimated that the company would add a “couple of million tons” of removal capacity every year.

CO280 declined to specify the cost of the retrofit. Rhone said that it’s in the “hundreds of millions of dollars.”

The company’s rapid expansion would be made possible by what Rhone described as a “happy coincidence”: Many U.S. pulp and paper mills are based on the Gulf Coast, an area that is already being targeted for carbon removal projects because it has good options for geologic storage. That means there is existing infrastructure for importing and burning biogenic carbon in a region where the emissions can be stored. Add carbon capture to the equation, and a powerful removal option becomes available. U.S. pulp and paper mills emit close to 90 million tons of CO2 annually, according to CO280.

“Pulp and paper without a doubt is going to be a major player in the carbon removal space,” said Joe Sagues, a researcher at North Carolina State University who studies the removal potential of the industry.

Questions on the process

The long-term impact of these retrofits has been questioned, however. In a post published this February, researchers at the non-profit CarbonPlan noted that the ultimate goals of carbon removal are to deal with residual emissions from industries that can’t be decarbonized and to draw down excess carbon from the atmosphere. The researchers looked at facilities that produce ethanol from corn and observed that even after retrofits of carbon capture equipment, the process as a whole remains a net emitter. In that case, embedding removal in the industry can reduce emissions but won’t deliver on the goal of drawdown.

‘A fair point to make’

CO280’s first Gulf Coast retrofit will fit this pattern in that it will capture only around half of the facility’s biogenic emissions. But ethanol retrofits are more challenging to make carbon-negative, said Sagues: growing corn produces emissions, fossil fuels are used to make the ethanol and the large amounts of biogenic carbon are emitted when ethanol is used in vehicles. In pulp and paper mills, most of the emissions come from biogenic black liquor and could be captured as retrofits spread. In theory, the industry has a long-term path to negative emissions that ethanol lacks.

“I think it’s a fair point to make,” said Rhone of the CarbonPlan critique. Existing financial incentives, including the relatively high price of removal credits and federal tax incentives, provide a foundation for getting started, he added. More expansive capture systems can then follow if the economics work.  “Ultimately the goal is to get to completely net zero mills, but these are complex projects,” said Rhone.

The tax incentives include a tax credit for carbon storage known as 45Q, which was introduced in the first Trump administration and strengthened as part of the Inflation Reduction Act (IRA), as well as support from the Department of Energy. The Trump administration has not made its position on carbon removal clear, but the industry has watched nervously as key members of the DoE’s Office of Fossil Energy and Carbon Management, which oversees several removal initiatives, departed after the election.

The post Why Microsoft is buying carbon credits from a pulp and paper mill appeared first on Trellis.

To enhance water stewardship, tout the ‘restoration of nature and ecosystems’

Key takeaways

  • To reach a wider audience, companies need to avoid jargon-heavy water stewardship terms.
  • Credible descriptions for water stewardship targets succeed when water is linked to climate, nature and people.
  • Compelling stories can help stakeholders understand why water issues and programs matter to them.

If the terms “water positive” and “nature positive” leave you confused, you’re not alone. To improve water stewardship and communications around the topic, companies need to avoid technical or jargon-heavy terms that aren’t engaging for most audiences.

In a recent survey of more than 350 water and sustainability experts, Trellis data partner GlobeScan, in conjunction with the World Wildlife Foundation, found the most meaningful and credible descriptions for water stewardship targets are:

  • “restoration of nature and ecosystems” (49%)
  • “science-based” (42%)
  • “protection of rivers, lakes, and wetlands” (40%)

In contrast, experts consider “water positive,” “nature positive,” and “replenish” to be the least meaningful and credible of the options presented.​ Similarly, GlobeScan’s public opinion research shows people rank “protect rivers, lakes, and other water-based habitat/nature” much higher than “use less water in operations and supply chains” in terms of the most important water-related goals for an environmentally-responsible company.

The research points to three reasons for low levels of awareness and engagement related to companies’ water stewardship activities:

  • Most companies don’t talk about water very often or via channels that reach many stakeholders
  • Water-related communications usually put a heavy emphasis on data and methodologies like “water positive” and “replenish” that are not very relatable or compelling for most stakeholders
  • Corporate communications on water focus too much on the quantity/efficiency of water whereas pollution or ecosystem restoration is more likely to gain traction with the public

What this means ​

Going forward, companies can improve transparency and disclosure by communicating in ways that are more relevant, tangible and engaging by linking water to climate, nature and people. Organizations can highlight the important ways that water links, shapes and contributes to powerful, nature-based solutions for climate resilience, adaptation and mitigation. The public strongly associates water with nature and conservation, and linking it to nature offers opportunities for restoration, progress and positive stories. More compelling corporate communications on water stewardship can help stakeholders understand why issues and programs matter to them and how both the company and consumers stand to benefit from corporate actions and investments. ​

Based on a survey of 352 water and sustainability experts across 63 countries and territories conducted in Nov.-Dec. 2024.

The post To enhance water stewardship, tout the ‘restoration of nature and ecosystems’ appeared first on Trellis.

Unilever pushes trade associations to speak up on climate policy

Key takeaways:

  • The success of Unilever’s climate transition action plan depends on stricter regulations for high-emitting sectors.
  • The company will quit trade groups that remain misaligned 12 months after being put on notice.
  • Unilever’s annual assessment of industry association is rare.

Unilever has distanced itself from two trade associations because their lobbying activities are misaligned with the consumer products company’s climate policy agenda.

In one instance, the company requested that the German Chemical Industry Association stop using Unilever’s name and logo in marketing materials because the organization is out of step with Unilever’s advocacy positions on renewable energy and carbon pricing. 

Unilever is also distancing itself from the Tennessee Chamber of Commerce & Industry, which represents the interests of an ice-cream manufacturing plant in Covington. That relationship will be reviewed in late 2025, along with several others, after Unilever divests its ice cream business.

The actions were outlined in Unilever’s annual assessment of the lobbying and political advocacy positions of more than two dozen key industry organizations in which it has a membership interest. 

The company belongs to more than 600 trade groups. Those assessed — including the Consumer Goods Forum and the Personal Care Products Council — represent sectors where more stringent regulations and policies are needed to drive climate progress.

“Unilever is already making progress toward our climate goals, but enabling government policies will help us go further, faster,” said Rebecca Marmot, chief sustainability and corporate affairs officer at Unilever. “We’ve increased our direct advocacy on climate issues to reflect that. We need trade associations to do the same, bringing their considerable influence to the table, and growing climate engagement amongst their members.”

As a matter of course, Unilever would rather stay engaged with trade organizations, to create constructive change. If a misalignment lingers for longer than a year, the issue is taken up by the Unilever division that owns the relationship. “At this point, we will determine whether to withdraw our membership and make our withdrawal public,” Unilever said in its assessment. “In some instances, there may be a disagreement regarding positions taken, but Unilever may decide that its interests are best served by retaining membership.”

Fewer trade groups misaligned with decarbonization goals 

Unilever’s most recent analysis, released April 7, uses publicly available information from research firm InfluenceMap. It found that 18 of the 26 evaluated organizations have no “misalignment” with Unilever’s climate policy positions. That’s up from 13 of the 27 organizations considered in the 2024 edition. 

But only five organizations are actively engaged in supporting climate policies, while 50 percent are “passive” — meaning they don’t speak out either way. Unilever wants those organizations to do more.

With one exception, the same organizations were evaluated in the two assessments.

“After last year’s [report], Unilever outlined additional actions for trade associations to take,” the company said in its analysis. “Many were responsive to requests, but more work is needed to make sure these actions lead to policy changes, especially since the last review was recent.”

5 cross-cutting political priorities

Unilever’s climate transition action plan calls for the company to actively engage on the following policies:

  • Convince countries to adopt national emissions reduction plans that will hold global temperature increases to 1.5 degrees Celsius
  • Advocate appropriate carbon pricing levels
  • Scale up renewable energy capacity, while phasing out fossil fuels
  • Support forest protection and nature restoration
  • Encourage the Greenhouse Gas Protocol to evolve carbon accounting standards to reward emissions reductions across corporate value chains

Unilever ranks as a leader among the limited group of corporations that actively engage on climate policy, and it was highlighted in 2024 by InfluenceMap for its influence on trade groups. 

“The review continues to raise the bar in driving best practices around how companies should be asking for stronger climate change policies while strategically engaging with their trade associations,” said Deborah McNamara, executive director of advocacy nonprofit ClimateVoice. 

Unilever is a bright spot at a time when many companies in the U.S. have “stagnated or gone silent,” she said. “I think companies need to be asking over and over again if enough is being done, and the answer is definitively no. This review however sets the path and shows what is possible.”

The post Unilever pushes trade associations to speak up on climate policy appeared first on Trellis.

3 ways tariffs will affect sustainable supply chains

Key takeaways

  • Supply chain shifts from tariffs could affect a company’s ability to collect data on the impact of value chains and shift carbon disclosure goal timeframes.
  • Compliance on human-rights initiatives and ethical business practices could vary if supply chains move location.
  • Companies committed to ESG performance likely will let political issues shake out before determining next steps.

The U.S. administration’s introduction (and delay) of sweeping tariffs already is showing signs of disrupting global trade. Of course, addressing the fundamental economic challenges the tariffs represent will be top of mind for all companies, but it’s important to note that the redrawn trade patterns and alliances will also likely change how companies approach their efforts to ensure supply chains meet their standards for environmental, social, and governance-related performance. 

In addition to the standard business imperatives of cost, quality, and timeliness, most global corporations have already invested significant resources into mapping their value chains. Forward-looking companies have also engaged with suppliers on a wide range of issues including climate reporting and performance, human rights-related issues and ethical business practices.

But as customers and suppliers come to grips with a new economic landscape, it may require them to change suppliers to ensure they can remain economically competitive. 

A supply chain reshuffle 

According to our conversations with several global companies in the pharmaceuticals, software and manufacturing sectors, it’s still too early to predict the exact impacts of tariffs. However, all see the following three scenarios as possible, if not likely, if tariffs remain in place for any significant period.

  • Supply chain shifts could affect data collection: Global corporations have invested substantially in building relationships with suppliers who share or at least agree to support efforts to obtain relevant data regarding the impacts of their value chains. The new economic calculus that the tariffs represent will almost certainly result in substantial portions of global supply chains being restructured and new relationships being put in place. This will affect mutual agreements on what information is provided by suppliers to customers – such as carbon metrics, health and safety information, human rights-related data and other sustainability measurements. Many of these ESG data collection processes will need to be rebuilt to some extent and may result in a disruption of data availability for some time. 
  • Changing carbon disclosures and goal timeframes: Various goal-setting regimes, including those administered by the Science Based Targets Initiative (SBTi), often have a requirement for companies to set goals related to the emissions that originate in their supply chain. To meet these goals, companies often will encourage their suppliers to set their own goals. However, if companies have to identify new suppliers to mitigate the impact of tariffs, most of these agreements will need to be renegotiated, putting those companies who have set such goals at risk of not being able to accomplish them in the time frame expected. This may result in reputational damage to those not able to meet their original commitments. 
  • Compliance unknowns for suppliers and manufacturers alike: The onshoring of supply chains in response to tariffs may result in easier compliance with various human rights and anti-corruption requirements. That’s because many companies have built sophisticated operations to protect working conditions and uphold ethical business practices. If supply chains are moved geographically closer — presumably to where the regulatory environment is similar to the purchaser — then there’s the chance we could see a net benefit from such tariffs. On the flip side, if a company requires certain raw materials that only originate from specific countries as an essential component to their manufacturing process, it’s also possible there could be a “race to the bottom” — where companies are tempted to source materials from anywhere, regardless of the supplier’s commitment to human rights and ethical business practices. 

Doubling down on values

It’s clear we’re in a highly disruptive period for businesses, particularly for those committed to sustainable business practices. If you couple tariffs with an administration that’s clearly inclined to deregulate sustainability-relevant issues, then progress towards a more sustainable future may be more difficult for the next few years. 

That’s why companies should prioritize their most important “non-negotiables” — be it human rights, basic carbon data and/or anti-corruption efforts — and stick to their values on these. Then let the political issues shake out before determining the next best steps. 

Regardless, the business case for sustainable practices remains clear. Forward-looking companies that have already committed to visibility and traceability in their supply chain will be better positioned to navigate these disruptions and quickly adapt to the new global supply chain landscape. 

[Connect with more than 3,500 professionals decarbonizing and future-proofing their organizations and supply chains through climate technologies at VERGE, Oct. 28-30, San Jose.]

The post 3 ways tariffs will affect sustainable supply chains appeared first on Trellis.

5 insights for CSOs from London’s Nature Tech Summit

Key takeaways

  • The view that nature strategies are beyond companies’ capacity and budgets is outdated.
  • It’s now the job of the CSO to make the case that funding biodiversity conservation and restoration should be part of the company’s overarching environmental strategy.
  • AI is now making previously impossible projects viable.

Entrepreneurs, investors and companies gathered in London for a Nature Tech Summit on March 27th. The event, part of the world’s first “nature tech week,” revealed key insights to guide CSOs in their nature tech decision-making, including trends around AI, politics and data sources. 

Nature tech is booming, as startups in the field attracted about $2 billion in funding in 2024, according to Nature4Climate, up from $1.6 billion in 2023 and double the investments of 2018. 

However, as this young sector matures, CSOs face a potentially confusing smorgasbord of tech. Satellite forest data, drones, eDNA, bioacoustics ground sensing — the list continues to grow. Trellis attended the Summit to hear how companies can surf the trends and make the most of nature tech this year.

What is nature tech?

“From detecting deforestation to efficiently mapping species ranges, a new class of companies and technologies are making it possible for CSOs to account for their companies’ nature impacts,” said Kevin Webb of Superoorganism, a venture capital company focused on biodiversity, in an email.

“What a lot of the purists would say is that it’s any form of technology, anything from AI to drones to genomic sequencing, that is implemented to benefit nature,” said Ollie Potter, founder of The NatureTech Memos, a newsletter focused on the nature tech market.

Energy, pharmaceuticals and mining are the three sectors currently showing the most interest in nature tech, said Potter, but they are not necessarily the most at risk. “I think there is a different conversation to be had about which industries face the most material risk because of nature degradation.” 

Industries at high risk include agriculture, cosmetics and fashion.

Five insights 

1. Companies need climate and nature strategies

“We work with some financial institutions, and a few of them say: ‘Can we just do climate? We can’t really do nature as well,’” said Jo Paisley, president of GARP Risk Institute, during a panel at the summit.

Although some CSOs might consider nature strategies beyond their capacity or budget, this view is outdated. To be sustainable going forward, companies must adopt both climate and nature strategies — irrespective of changing governments and political will in their countries. 

There was a subtle, if unmissable, political undercurrent at the Summit. Many speakers alluded to “shifting landscapes” or “uncertain times” in reference to Trump’s anti-climate policies and rightward trends in European countries. 

Gareth Thomas, Head of Research Innovation at London’s Natural History Museum, shared the clearest message: “Political shifts don’t change ecological facts.

“Nature doesn’t care about politics. Biodiversity is declining. Risk is increasing and instability is growing. The consequences of that remain as inevitable as they did back in December,” he said.

It’s now the job of the CSO to convince the CFO and other executive leaders that funding biodiversity conservation and restoration should be part of the company’s overarching environmental strategy, alongside cutting emissions.

“Often CSOs are bewildered about how to make the case for nature preservation in their organisation,” said Gilad Goren, executive director of the Nature Tech Collective, a nature tech accelerator. “But nature tech can actually help them make the case because these entrepreneurs can back the case up with actual data.”

2. Nature tech isn’t just for reporting

The NatureTech Memos has mapped the sector, capturing more than 1,000 startups in one big table. Some of them provide nature and biodiversity data, while others organize this data so that companies can use it. For example, companies might use nature tech to inform insetting or to make decisions about financing nature restoration projects.

“A common perception is that nature tech is about helping corporates report about their nature risks and dependencies, either through [the EU’s Corporate Sustainability Reporting Directive] or [the Taskforce on Nature-related Financial Disclosures],” said Potter. 

But that doesn’t go far enough. These innovations also give sustainability leaders the quantitative data they need to demonstrate their companies’ supply-chain dependence on biodiversity and strengthen the case for funding nature strategies.

“I think more and more are going to look at the resilience of their business in terms of: Will I have commodity X coming my way or not?” said Goren. “And will I have issues with my supply chain unless I do something about it? Do I need to assess? Or do I need the actual intervention?”

3. Look for data validated by ecologists on the ground

A lot of forest data is gathered using satellite imagery. “The benefit of that is that you can get the data from anywhere in the globe, even where it’s hard to access,” said Sabine Nix, a spatial data scientist at Cecil, a nature data aggregator. “But you also need to be able to train models and validate your data using insights gathered on the ground.”

Cameron Nicol, head of marketing at Space Intelligence, a company using satellite data to map global forest cover, echoed that: “​​One of the challenges of using remote sensing to map landscapes can be getting the granularity to differentiate between what is actually a forest and what is a crop plantation of, say, coffee or cocoa. 

“We’ve been incorporating ecologist expertise into our mapping processes to ensure these forests and tree crops are accurately categorized,” he said.

4. Companies using multiple data sources should stay focused

As well as seeking data validated on the ground, Nix has noticed more companies using a combination of different datasets to inform decisions. “We’re already seeing customers using 10, 20 or 30 different data sources,” she said.

That being said, numerous experts advised CSOs to focus on the question they need to solve, rather than exploring and adopting multiple nature tech innovations as they reach the market.

“There are a lot of different offerings emerging in this space, from data providers to data organizers. CSOs should focus on improving their metrics and think about whether they want general data or specific data about their supply chains,” said Marco Albani, CEO of Chloris Geospatial, a nature data provider.

5. Accelerate data collection using AI

Of course, artificial intelligence is also transforming nature tech. From the micro (a start-up recording earthworm sounds to indicate soil health) to the macro (a company mapping forests in the tropics), large language models are increasingly prevalent. 

Such innovations can equip CSOs with new, previously inaccessible, data and enable them to return to projects previously deemed impossible.

For example, AI has sped up Space Intelligence’s satellite forest data collection, said Nicol: “We’ve now mapped 50 countries across the world and that’s taken us six or seven months, whereas, without AI machine learning, that same work would have taken six or seven years.”

[Join a vibrant community of leaders and innovators driving cutting-edge tools, business strategies, and partnerships to protect and regenerate nature at Bloom, Oct. 28-30, San Jose.]

The post 5 insights for CSOs from London’s Nature Tech Summit appeared first on Trellis.

New SBTi CEO urges companies to step up action on net zero

Key takeaways:

  • SBTi’s new CEO stresses the need for flexibility in target-setting methodologies.
  • Corporations shouldn’t wait for the new Corporate Net Zero Standard methodology to set emissions reduction goals.
  • Climate transition plans will become a critical component of the target-setting process.

The Science Based Targets initiative’s new CEO, former EY sustainability consultant David Kennedy, said the nonprofit must evolve to recognize “pragmatic” approaches for corporate emissions reductions as it finalizes extensive revisions to the Corporate Net Zero Standard.

Kennedy officially joined SBTi in early April, after being named as the new CEO in early January. He boasts three decades of experience in developing net-zero strategies within government and the private sector, especially those related to food systems.

While Kennedy is in “listening and learning” mode during his initial days as CEO, he offered initial impressions and hints about his priorities during an April 9 webinar convened to field questions about the proposed new standard published March 18. SBTi is accepting feedback on the revisions until June 1, as part of public consultations and an online survey. 

“We have to be science based, but we can be more pragmatic and more action focused,” Kennedy said. “We need to be a listening organization; we need to be building relationships.”

New political and economic reality

The Corporate Net Zero Standard revision comes at a fragile moment. While most corporations remain “committed and determined” to reduce emissions, the mood has shifted because of the U.S. political situation and some will find it “very difficult” to meet their original reduction targets set for 2030, Kennedy said. 

SBTi must find ways to reward action even when companies fall short of the goal, he said, noting: “It’s more clear as we move to implementation just what the challenges are.” 

Kennedy highlighted several proposed evolutions in the methodology that he said should benefit corporate practitioners, including:

  • A defined process to assess progress and gaps at the end of a target cycle
  • The decision to let corporations set separate targets for Scope 1 (their own operations) and Scope 2 (purchased electricity and energy)
  • A proposal to require corporations to submit a climate-transition action plan after having targets validated

Companies should not wait for the new standard, which won’t be finalized until late 2026. SBTi will offer a transition path and there “will be mechanisms to align with the next cycle,” Kennedy said. “Get on with acting and driving down your carbon footprint.” 

[Connect with more than 3,500 professionals decarbonizing and future-proofing their organizations and supply chains through climate technologies at VERGE, Oct. 28-30, San Jose.]

The post New SBTi CEO urges companies to step up action on net zero appeared first on Trellis.

Climate United Fund v. Citibank (and EPA): What you should know

Key takeaways

  • Climate United sued the EPA and Citibank for freezing nearly $7 billion in funding towards decarbonization projects.
  • The first suit of its kind during the second Trump administration, its ruling will set a precedent for any future litigation accusing the federal government of illegally withholding funding.

Climate United, often referred to as America’s green bank, sued the EPA and Citibank over its congressionally appropriated funds being frozen. It now awaits the court’s ruling, which is expected to come out on April 15 — a decision likely to set a crucial precedent.

The timeline (so far)

April 2024: Climate United is one of three coalitions selected by President Joe Biden’s EPA to disburse $20 billion to decarbonization projects across the country under the Greenhouse Gas Reduction Fund (GGRF), established in the Inflation Reduction Act.

February 12, 2025: EPA administrator Lee Zeldin releases a social media post accusing Climate United of financially mismanaging the funds designated by the GGRF.

February 18: The nearly $7 billion in funding — held in accounts at Citibank — is frozen after Zeldin’s accusations.

March 5: Citibank releases its first statement, to Trellis, saying, “Our role as a financial agent does not involve any discretion over which organizations receive grant funds.”

March 8: Climate United sues both the EPA and Citibank for a temporary restraining order that would force EPA and Citibank to unfreeze the funds.

March 11: After the EPA requests a one-day delay in the hearing, Zeldin announces the termination of the GGRF.

March 12: Climate United, the EPA and Citibank appear before the U.S. District Court for the District of Columbia in response to the lawsuit. Judge Tanya Chutkan questions whether “the request for an additional day was made in good faith.” Chutkan also appears to question the legitimacy behind the EPA’s reasons for freezing the funding, asking its lawyer, “Can you proffer any evidence that [the grant] was illegal, or evidence of abuse or fraud or bribery — that any of that was improperly or unlawfully done, other than the fact that Mr. Zeldin doesn’t like it?”

What the case could mean for the future

Citibank and the EPA’s actions towards congressionally allocated funding already in the hands of the grant recipient is a first; the outcome will create a precedent for any future lawsuits filed against the agency in connection to previously established federal funding programs. Already, the Coalition for Green Capital (CGC) — one of the other two coalitions awarded money from the GGRF — has also filed a lawsuit against the EPA and Citibank over the termination of its $5 billion grant.

The post Climate United Fund v. Citibank (and EPA): What you should know appeared first on Trellis.

Adidas greenwashing judgment offers warnings about climate claims

Key takeaways:

  • A German court found Adidas guilty of vague climate claims without defined pathways or offset disclosures.
  • Experts warn of “greenhushing” but encourage clearer communication.
  • New legal challenges and scrutiny around sustainability marketing and reporting are emerging.

Adidas maintains standard best practices to reduce its contributions to the climate crisis, including grounding net zero targets in science. However, that didn’t stop the company from losing a greenwashing lawsuit. On March 25, the Nuremberg-Fürth Regional Court in Germany found Adidas guilty for failing to detail how it would achieve “climate neutrality” by 2050.

Despite the lack of a fine, the bad press for Adidas brings repercussions for other companies advertising climate goals. The suit uniquely targeted a broad, long-term ambition that underpins an overarching corporate sustainability strategy, rather than a specific product claim.

“It is a warning shot for other textile companies to make sure they can substantiate their claims and to move away from vague terminology,” said Richard Wielechowski, senior analyst at Planet Tracker in London. “There is a challenge here in that brands that are trying to do something and talking about it are the ones risking being hit with litigation, whilst those doing nothing get ignored. This might encourage greenhushing.”

Such rulings bring cons and pros for corporate sustainability work, according to Suzanne Shelton, senior partner at ERM Shelton, in Knoxville, Tennessee. “I worry companies will get demotivated from doing the arduous, trailblazing work of decarbonizing, and maybe we’re not giving enough grace for companies to find their footing and communicate as they go,” she said.

“On the other hand, we do need to communicate with consumers in a crystal clear way – our data has shown for years that nobody likes to find out that environmental claims that played a role in their decision to purchase were misleading (it’s damaging to brands).”

These details about difficult decarbonization efforts, including in Scope 3 emissions, come from the annual 2024 report by Adidas.

Deception or imprecision?

Environmental Action Germany, or Deutsche Umwelthilfe (DUH) filed the suit last fall, accusing Adidas of deception. “Companies may not simply communicate sustainability goals (or climate neutrality targets) without explaining how they intend to achieve them,” said Agnes Sauter, DUH head of ecological market surveillance. “The ruling shows that transparency and comprehensible plans for how sustainability goals are to be achieved are essential to create trust and to ensure legal compliance.”

Adidas shared a statement with Trellis: “The decision relates exclusively to a specific wording on our website, which we already adjusted in August 2024.”

The Herzogenaurach, Germany-based brand has not altered its plans to reduce emissions. “Progress is already clearly visible: since 2022, absolute emissions including the supply chain have fallen by 20 percent,” the Adidas spokesman added.

Adidas is among 500 apparel companies with third-party approval by the Science-based Targets initiative for a net zero target. The company aligned that 2050 deadline with an ambitious, Paris Agreement level of a 1.5 degrees Celsius rise in global temperatures.

The specific legal complaint was that Adidas failed to define “climate neutrality” or admit to using offsets.

A year-old Adidas web page about its 2023 environmental impacts now addresses both issues by defining “climate neutrality” as a concept that may balance “residual emissions with emission removals as well as accounting for regional or local bio-geophysical effects of human activities.”

In recent communications, Adidas appears to be dropping language about “climate neutrality,” which it qualified here in its 2023 annual report.

Adidas discloses emissions steps

Adidas’s 2024 annual report, issued March 5, does not prominently mention “climate neutrality.” It does, however, detail activities to meet net zero across Scopes 1, 2 and 3 by 2050. That goal includes a 42 percent reduction in indirect Scope 3 pollution by 2030 over 2022 levels, and a 70 percent drop for both Scope 1 direct emissions and Scope 2 energy emissions.

Scope 3 is a special focus for Adidas, whose energy-intensive upstream activities create 87 percent of overall climate emissions. Progress there hinges upon encouraging suppliers to adopt renewable energy and abandon coal-fired boilers. To that end, more than half of the brand’s direct suppliers or subcontracting suppliers had made energy upgrades by the end of 2024.

As for efforts to use lower carbon materials, Adidas sources 99 percent of its main material, fossil fuel-based polyester, from recycled sources. By 2030, it plans to derive 10 percent of its recycled polyester from used textiles. Upcycled marine plastic waste, including fishing nets, is a major source today.

Beware making ‘aspirational’ sustainability claims

Experts note that more legal challenges to insubstantiated expressions of ambitious climate goals may increasingly emerge, especially if the European Union’s Green Claims Directive becomes regulation as expected later this year. Already in January, the E.U. Corporate Sustainability Reporting Directive (CSRD) began requiring companies to share their climate transition plans or provide reasons for why they have not. 

“The same types of cases as the Adidas case are happening in the United States,” said Katie Bond, partner at the Keller and Heckman law firm in Washington, D.C. “There are, for instance, several prominent cases on so-called “aspirational” claims and there are lots of cases on carbon-related claims.”

A leading example of aspirational claims comes from a 2023 challenge, by an arm of the nonprofit BBB National Programs, to meat giant JBS Holdings of Greeley, Colorado. In response, the company modified language about a “Global Commitment to Achieve Net-Zero Greenhouse Gas Emissions by 2040.” The new language replaced “commitment” with fuzzier terms, such as “ambition” and “goal.”

JBS had also made claims such as, “We’re setting time-bound, science-based targets and backing them up with $1 billion in capital over the next decade.” The New York Attorney General filed suit against the revisions. In January, however, the court dismissed, “finding that without the “commitment language,” the issue seemed to be resolved,” Bond said.

Meanwhile, cases over “carbon neutral” claims have attacked Delta, Evian, Apple and Clif Bar. It remains to be seen how these will fare, but companies can reduce risk by explaining exactly what they mean by “carbon neutral” or “carbon negative,” according to Bond.

In fashion, fits and starts for greenwashing challenges

Fashion brands have withstood high-profile greenwashing challenges in recent years. A judge last summer dismissed a class action lawsuit against Nike for its “Move to Zero” initiative and claims about sustainable materials.

Two separate 2022 class action lawsuits, in New York and Missouri, challenged the language in H&M’s “conscious choice” collection. The cases ultimately fizzled out, but companies should learn from them what wording and substantiation helped H&M’s defense, according to attorney Bond.

“In H&M in particular it seemed to make a difference that the company labeled its clothing “more sustainable” and explained why, versus claiming that its clothing is across-the-board ‘sustainable,’” she said. “I think compliance lawyers like me have been saying for a long time to be wary of ‘big’ claims like ‘sustainable’ and ‘eco friendly.’”

Meanwhile, the U.S. Federal Trade Commission has been working behind the scenes to make the first updates since 2012 to its Green Guides. Corporate legal teams, and activists, follow the guides to gauge the potential liability of businesses’ environmental claims. The guides are expected to refresh in the next few years, if not sooner.

“I’m afraid the sustainability communications sector has been the Wild Wild West for a long time, and most generalist ad agencies simply don’t realize they’re overstating claims when they do,” Shelton said. “So it is important for regulators to get guard rails in place, as is happening in both the E.U. and U.K., and for companies and their comms agencies to get the message that sustainability is no place for hyperbole.”

The post Adidas greenwashing judgment offers warnings about climate claims appeared first on Trellis.

U.S. railroad launches book-and-claim scheme to reduce Scope 3 emissions

Key takeaways:

  • Norfolk Southern is allowing freight customers to buy Environmental Attribute Certificates, which they can use to reduce Scope 3 emissions.
  • Similar schemes already exist in aviation and maritime shipping.
  • The company has a goal of having lower-carbon fuels account for 7 percent of its fuel mix by 2027 and 20 percent by 2034.

A major U.S. railroad is joining the aviation and maritime shipping industries in launching a book-and-claim scheme to help customers reduce freight emissions.

Norfolk Southern, which operates more than 3,000 locomotives and moves around 7 million shipments annually, unveiled its RailGreen system last week.

Like other book-and-claims schemes, RailGreen is designed to allow any customer to pay for and claim Scope 3 benefits. When biodiesel is used in a Norfolk Southern locomotive, the company generates an Environmental Attribute Certificate (EAC) for every ton of emissions avoided. Customers then purchase EACs and count them against Scope 3 emissions. The certificates cannot be used twice or passed to another company. 

The scheme was inspired in part by an equivalent maritime project known as Ship Green that was developed by maritime shipper Hapag-Lloyd, said Josh Raglin, Norfolk Southern’s chief sustainability officer. The Sustainable Aviation Buyers Alliance operates a similar scheme for air travel.

Displacing diesel

Norfolk Southern’s biodiesel will be produced from vegetable oils, animal fats and used cooking oil, said Raglin. The company’s locomotives do not have to be modified to work with the fuel — provided that the lower-carbon alternative does not make up more than 20 percent of the mix. Norfolk Southern is working on introducing another alternative fuel, known as renewable diesel, that can completely replace fossil diesel. Raglin said the company has a goal of having these lower-carbon fuels account for 7 percent of its fuel mix by 2027 and 20 percent by 2034. 

Norfolk Southern is aiming to use 9 million gallons of biodiesel this year, which, if certified through the RailGreen system, would generate EACs corresponding to 70,000 tons of CO2. Raglin declined to disclose the exact cost of an EAC, but said that it would be less than $100.

The scheme builds upon Norfolk Southern’s emissions tracking technology, which checks fuel burn in locomotives every 15 minutes. The data is used to report emission shares to individual customers, adjusted for the weight of freight they are moving, distance travelled and other factors.

Intermodal impacts

Fuel switching initiatives are worth pursuing because no new technology is required to implement the schemes, noted Scott Bernstein, founder of the Center for Neighborhood Technology and an expert on railroads and other aspects of regional and urban planning. The downside, he added, is that they can distract from investing in more consequential changes: “Sometimes fuel switching ends up being an excuse for not making capital investments in a more efficient sort of system overall.”

One example that Bernstein advocates for is intermodal freight, in which transport networks are redesigned to shift the burden from road to rail. The idea was the subject of a 2023 report by the Environmental Defense Fund, to which Bernstein contributed. Because emissions from rail are around 75 percent lower than the equivalent from trucking, shifting freight from one modality to another can produce big benefits, regardless of the fuel used. 

“Going from truck to train is probably a much greater impact on decarbonization than staying with train and just changing the fuel ingredient,” said Bill Loftis, a supply chain expert, author of the EDF report and owner of Supply Chain Ecology, a consultancy. “It’s bound to be because rail is tremendously more efficient than truck.”

The post U.S. railroad launches book-and-claim scheme to reduce Scope 3 emissions appeared first on Trellis.