Canada Follows Europe, China, & USA With Anti-Greenwashing Provisions, Oil & Gas Industry Freaks Out

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You might be surprised to know that the oil, gas, and coal industries make claims that aren’t completely aligned with reality, and indeed often make claims that have no discernible relationship to it. I know, I know, it’s a shocking revelation. That’s why Canadian firms in the sector are leading the charge against new Canadian regulation, or battening down the hatches, or perhaps circling the wagons, or maybe advancing to the rear. It’s all rather confused right now.

What’s the impetus for this running in all directions reaction? The Canadian government is taking significant steps to combat greenwashing with the introduction of new provisions in Bill C-59, spearheaded by Prime Minister Justin Trudeau and Finance Minister Chrystia Freeland. These measures, part of the broader amendments to the Competition Act, aim to enhance transparency and accountability in environmental marketing claims. Companies are now required to substantiate their sustainability claims with reliable data and third-party verification to avoid hefty fines that can reach up to 3% of annual global revenues, capped at $15 million, for each offense. The provisions also empower private parties to directly bring claims to the Competition Tribunal, bypassing the traditional reliance on the Competition Bureau for enforcement. This move is designed to crack down on misleading environmental claims and ensure that consumers can trust the green credentials of the products they purchase.

That’s horrible and draconian, isn’t it? Being required to substantiate positive environmental claims with data and third-party assessments? It’s almost like being required to tell the truth. You can see why the Canadian oil and gas industry is freaking out. After all, this is the industry that had its captive Albertan government create Canada’s Energy War Room, officially known as the Canadian Energy Centre. It was announced in 2019 by the Alberta government under Premier Jason Kenney with a budget of $30 million per year.

The initiative aimed to counter what the government described as misinformation about Alberta’s oil and gas industry and to promote the province’s energy sector. However, the War Room has faced numerous embarrassments since its inception. Shortly after launching, it was criticized for using a logo that closely resembled that of a US software company, leading to an expensive rebranding effort. Additionally, it was caught using stock photos from foreign countries in its promotional materials, which undermined its credibility. The War Room’s lack of transparency and accountability, operating as a private corporation exempt from certain oversight, also attracted significant public and media scrutiny. These issues culminated in widespread criticism that the War Room was more of a propaganda tool than a legitimate source of information.

Say it isn’t so. Thankfully, this is a rare example where the industry didn’t hold itself to the highest ethical and intellectual standards. Oh, wait. Did someone mention ExxonMobil? One of the world’s largest oil companies, it became aware of the potential impacts of climate change as early as the late 1970s and early 1980s. Internal documents and research reports from that period revealed that Exxon scientists had warned senior executives about the potential for significant global warming due to carbon dioxide emissions from fossil fuels. Despite this early knowledge, ExxonMobil’s strategic response was to publicly downplay the risks of climate change. The company funded and supported various climate change denial campaigns and think tanks that cast doubt on the scientific consensus regarding global warming. This approach was aimed at protecting its business interests and delaying regulatory actions that could impact the fossil fuel industry.

Maybe it isn’t just Alberta, a morally suspect backwater. Maybe it’s endemic to the industry? Could it be? How would we be able to tell? Perhaps by looking east, west, and south to Europe, China, and the USA, and seeing if they are doing anything similar to what Canada is doing?

Europe has been intensifying its efforts to combat greenwashing, aiming to ensure that companies’ environmental claims are truthful and substantiated. The European Union’s Corporate Sustainability Reporting Directive (CSRD) is a cornerstone of this crackdown, requiring companies to provide detailed and verifiable sustainability information in their annual reports. This directive mandates the use of standardized reporting criteria, making it easier to compare and assess corporate sustainability claims. Additionally, the European Commission has introduced stricter guidelines for environmental marketing, emphasizing the need for transparency and accuracy. The Commission’s Green Claims Initiative, for instance, aims to prevent companies from making misleading claims about the environmental benefits of their products. This initiative is supported by the EU’s broader regulatory framework, which includes penalties for companies found guilty of greenwashing.

China has been taking notable steps to combat greenwashing, recognizing the importance of accurate environmental claims in promoting genuine sustainability. The country has implemented various measures and regulations to address misleading environmental marketing. For instance, the State Council’s recent regulations emphasize the need for businesses to avoid deceptive green claims and to ensure transparency in their environmental practices. This aligns with broader efforts under China’s Law on the Protection of Consumer Rights and Interests​.

The US Securities and Exchange Commission (SEC) has taken significant steps to address greenwashing through its proposed Climate Disclosure Rules, aimed at enhancing the transparency and reliability of climate-related information disclosed by public companies. These rules require companies to include detailed disclosures about their governance of climate-related risks, the actual and potential impacts of these risks on their business, and their greenhouse gas emissions, including Scope 1, 2, and, in some cases, Scope 3 emissions. Companies must also disclose their climate-related targets and goals and provide third-party verification for certain emissions data.

So Canada is merely aligning with its three biggest trading partners, arguably following in the footsteps of economies that dwarf its own. Wait, what does that mean for Alberta’s War Room, ‘independent’ bastion of propaganda on behalf of Alberta’s industry? Would it be subject to those big fines? Yes, yes it would, and more. Beyond fines, Canadian organizations that breach the greenwashing provisions in Bill C-59 could face a multitude of legal challenges. Courts or regulatory bodies can issue injunctions or cease-and-desist orders to halt misleading marketing practices immediately, and organizations may be required to engage in corrective advertising to rectify any false claims previously made. They could be compelled to provide restitution or compensation to affected consumers, potentially involving significant financial remedies. Private lawsuits from consumers, competitors, or advocacy groups present further risks, potentially leading to costly legal battles and settlements. Heightened regulatory scrutiny, including more frequent inspections and audits, adds to the burden, while in extreme cases, criminal charges against individuals within the organization could result in imprisonment. Moreover, class action lawsuits could emerge if large groups of consumers are affected, leading to substantial financial liabilities and resource-intensive defenses​.

Clearly the War Room was way over the line, so needed to be shut down entirely, right? After all, greenwashing propaganda was clearly wrong, they slipped up a bit in creating, funding, supporting, promoting, and amplifying it for half a decade, but what’s a small mistake among friends? Obviously the Alberta government accepted that it had made a wee error and made amends? Right?

Well, no. Premier Danielle Smith announced that the operations and functions of the War Room would be retooled and brought directly under her office’s purview. Know what that does? Not much. Any misleading environmental claims made by the War Room or its equivalent under the Premier’s office would still be subject to the same scrutiny and potential penalties as any other organization. This includes the risk of injunctions, corrective advertising mandates, and even legal challenges if deceptive practices are identified. All that this move does is put Alberta’s government directly in the firing line instead of a third-party agency. It’s kind of like saying, hey, the entire idea of a circuit breaker that protects me from being electrocuted seems pretty stupid, so I’m going to wire the 220 volt main directly to my right hand and turn on the switch.

Is this poorly thought-through response the only such action from the industry? No, there’s always Saskatchewan, the lesser known and harder to spell oil and gas industry province in Canada. What did they have to say?

Federal Coalition Government Plans New Gag Law on Saskatchewan Oil and Gas Companies

Yup, being required to tell the truth, with evidence and third-party certification, is gagging oil and gas companies.

Anyone else reacting? What about the oil sands folks? They have the Pathways Alliance, a coalition of Canada’s largest oil sands producers, formed to collaborate on reducing greenhouse gas emissions from oil sands operations, or at least tell everyone that they were reducing greenhouse gas emissions. The alliance includes companies responsible for a significant portion of Canada’s oil production, such as Canadian Natural Resources, Cenovus Energy, ConocoPhillips Canada, Imperial, MEG Energy, and Suncor Energy.

Naturally, everything that they published was factually-based and independently verified, right? After all, they aren’t the propaganda arm of Alberta’s government, but serious business types. So they probably didn’t do anything as their hands were clean, right?

No, they deleted all social media and everything from the web, leaving only a statement up saying that due to uncertainty, they felt it prudent. Perhaps it was because they’ve already had their feet held to the flames, facing scrutiny for their “net zero by 2050” claims. Greenpeace Canada pointed out that the Alliance’s advertising campaign, “Let’s clear the air,” misled the public by not accounting for significant Scope 3 emissions, which constitute the majority of their carbon footprint.

What about the Canadian Association of Petroleum Producers (CAPP), that upstanding lobbying association for Canada’s oil and gas producers? (Yes, three different well-funded, connected industry propaganda organizations does seem a little excessive, doesn’t it?) It’s been embroiled in several greenwashing controversies, primarily due to its promotional efforts and public statements that critics argue mislead the public about the environmental impacts of the oil and gas industry. CAPP’s advertising campaigns have portrayed the industry as environmentally responsible and committed to sustainability, despite significant greenhouse gas emissions and environmental degradation associated with oil and gas extraction. Involvement with the Pathways Alliance has further fueled these accusations, as environmental groups criticize the Alliance’s net-zero emissions claims for ignoring the full lifecycle emissions of fossil fuels. Additionally, CAPP’s lobbying efforts against stringent climate policies, while promoting industry efforts to reduce emissions, have been seen as attempts to protect industry interests under the guise of environmental responsibility. Did CAPP roll over?

Bill C-59 Competition Act Amendments Effectively Muzzles Canadian Businesses

Yes, all Canadian businesses. Muzzled, like a bite-y dog. Did they do anything else?

Yes, per the Wayback Machine, they used to have a section devoted to the environment and innovation, and another with news and resources. Both have disappeared, replaced with a CAPP Media menu item with nothing in it, just a contact form. In fact, you can’t navigate to their muzzled statement from their current website, but only find it via Google. (I frequently find the incompetence and arrogance of the industry and the PR agencies that support it amusing.)

It’s almost like the oil and gas industry in Canada and elsewhere are unable to actually talk about their products and operations without making it clear that they are horrific. Just imagine if they tried? Well, let me imagine.

• Our products cause climate change globally and environmental devastation at home!
• We’re giving amoral investors big dividends rather than investing in the future!
• Our orphaned wells will cost future taxpayers hundreds of millions to clean up!
• We’ve known that we were an environmental catastrophe for decades, so thanks for believing our lies!
• The oil and gas industry is a Ponzi Scheme where the last investors in are everyone on the planet!
• Our products when used as directed give children asthma and cause massive wildfires that hurt kids’ lungs even more!
• Our tailing ponds and plants kill vastly more birds than wind turbines, and we’re causing species to be wiped out entirely!
• Our idea of a just transition left 19 Calgary office buildings from our edifice complex phase vacant in the devastated downtown core!
• Our current products take so much energy to produce that it’s like energy from the 17th Century, but we hide that by burning them ourselves to make the energy!
• Our products will be first off the market as peak oil hits because they are incredibly high in sulfur and are mostly garbage, requiring lots of expensive blue and green hydrogen to refine!
• Sure, we’re destroying the world’s environment and future economy, but we’re making a lot of money for our investors and financiers this year!

Yeah, okay, perhaps being required to not lie about their sustainability efforts is like gagging or muzzling the oil and gas industry. If they are restricted to telling the truth and didn’t want to tell the whole truth, they would be restricted to saying very few things. Production reports. Revenues. Dividends. Disclosures of environmental impacts would be solely for regulatory and investment filings, not propaganda for the masses. This really cuts down on their ability to say anything.

Canada is doing exactly what its massive trading partners in all directions are doing, shutting down the fossil fuel industry’s greenwashing to ensure the public hears a lot more of the truth and a lot less of the disinformation. The world is making it clear that during the climate crisis, the industry most responsible for it is only allowed to tell the truth, or it will face consequences.