In response to a rising wave of litigation concerning assertions of carbon neutrality, a significant number of global corporations and asset managers seem to be adopting the approach of ‘going silent’. This tactic of refraining from public communications about carbon reduction objectives has been aptly dubbed as “greenhushing”. But with this seeming solution come new challenges, raising the question: Is silence truly golden in the era of corporate accountability?
While some might initially perceive greenhushing as the path of least resistance, it is not immune to its own controversies. It has gradually become a hot topic among regulators, sparking concerns with the potential for causing corporate whiplash. This unexpected backlash has led to a consequent ‘Carbon Claims Pincer Movement’, as reasoned and detailed in this analysis by Katten Muchin Rosenman LLP.
In facing litigations related to their green credentials, organisations have a tricky line to tread. On one hand, making public commitments to carbon reduction implies the risk of being held accountable should the organisation not be able to meet its commitments. On the other hand, resorting to silence – or greenhushing – is not free from perils, with regulators becoming increasingly intolerant of this lack of transparency.
Clearly, the issue of carbon claims and neutrality is a complex one, calling for far-sighted solutions and astute handling by corporations. Successful navigation of this terrain will demand not only firm commitment to sustainability, but also a genuine transparency with stakeholders. Evidently, the era of greenhushing may be on the wane, making way for a far more engaged and accountable approach to sustainability commitments on the corporate stage.