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Here in Canada, oil and gas companies, the single largest source of greenhouse gas emissions, need to step up and take meaningful climate action now.JASON FRANSON/The Canadian Press

Catherine McKenna is Canada’s former minister of environment and climate change, as well as minister of infrastructure and communities. Ms. McKenna is principal of climate and nature solutions and chair of the United Nations Secretary General’s High-Level Expert Group on Net-Zero Commitments of Non-State Entities. She is a speaker at the GLOBExCHANGE Sustainability Conference in Toronto, which runs Feb. 27-March 1.

The trillion-dollar transition to a net-zero future is the largest economic and jobs opportunity in our lifetime.

Around the world, and most notably in the United States, the race to win in the net-zero future is on. Canadian businesses are well-placed to be green industrial leaders, but only if we compete hard and raise our ambition, diligence and discipline.

Despite the fact that net-zero pledges have now been made by 40 per cent of Forbes’s list of 2,000 largest public companies, the reality is that many are not robust enough. At their worst, the pledges create a false impression that lead investors and consumers to believe that a company is doing more to protect the environment than it is.

Here in Canada, oil and gas companies, the single largest source of greenhouse-gas emissions, need to step up and take meaningful climate action now. But instead, we have the Pathways Alliance – which represents major oil sands companies – taking out full-page newspaper advertisements claiming they are on their way to net-zero despite all evidence to the contrary.

It is no secret that the window to limit dangerous warming to 1.5 C and ensure a sustainable future for our planet is quickly closing. While countries must take the lead, we simply won’t get to net-zero emissions by 2050 without strong and measurable commitments by non-state actors, especially companies. The United Nations Secretary General António Guterres puts it starkly: “We cannot afford slow movers, fake movers, or any form of greenwashing.”

New global climate accounting standards take aim at greenwashing

I chair the United Nations Secretary General’s High-Level Expert Group on Net-Zero Commitments of Non-State Entities. Our report, Integrity Matters, released at COP27 in Egypt, cuts through the hype and presents a clear set of criteria and standards for net-zero commitments by businesses, investors, and cities and regions. It draws a red line around greenwashing, establishing 10 recommendations that require not only long-term pledges but also short-term science-based targets, detailed transition plans, and credible and independent reporting and verification to ensure progress is being made.

We cannot allow companies to claim they are on the path to net zero if they are investing in new fossil-fuel infrastructure, if their absolute emissions are not decreasing, if they are only reporting on part of their emissions or if they are lobbying to undermine climate policy. And because voluntary pledges often lack accountability, our report calls on governments to develop regulation and standards for corporate net-zero pledges.

This issue is particularly relevant to Canada where, unlike most other heavy industry sectors such as steel and cement, oil and gas company emissions are still rising – a trend that we can no longer afford if we want to avoid the worst impacts of climate change. This sector will make or break Canada’s climate commitments. But instead of oil and gas companies using their massive profits to invest at scale in clean energy, they are returning their profits to shareholders while lobbying for more taxpayer subsidies – at the same time as regular Canadians are feeling the squeeze from high fuel prices.

The good news is that transparency and accountability around net-zero pledges is gaining ground. Consumer protection and competition agencies are acting on misleading climate claims. Governments around the world are mandating that companies disclose their climate-related risks, and some, such as the EU and Britain, are moving to require disclosure of net-zero transition plans. New initiatives such as the Carbon Disclosure Project and the Net Zero Tracker are assessing corporate climate plans, and shareholders are starting to hold executives to account.

Last year, French President Emmanuel Macron and UN Special Envoy for Climate Ambition and Solutions, Michael Bloomberg, announced that they are establishing a new Net-Zero Data Public Utility, an open and free centralized repository of data on company emissions and climate plans. The pressure to get real is increasing markedly.

Smart investors understand this, but too many Canadian banks and pension funds are failing to show the foresight and determination that their shareholders – and citizens – should expect. Fortunately, leaders such as Caisse de dépôt et placement du Québec, the Ontario Teachers’ Pension Plan and the University Pension Plan understand the new world of climate-related risks and are showing us what climate-savvy investment strategies look like.

This is the real opportunity in front of Canadians: not feel-good ads and more greenwashing, but climate action that creates good jobs and lasting prosperity by doing the right thing – with integrity – and that protects the planet for all.

Editor’s note: A previous version of this article included an incorrect reference to the Carbon Disclosure Project. This version has been updated.

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