The Myth of “100 Companies Being Responsible for 71% of Global Emissions”
Photo by Kouji Tsuru on Unsplash
If you have been around the Internet for a while, you may have heard the statistic that “71% of Global emissions are coming from only 100 companies” since 1988. The statistic comes from a report by the CDP (formerly the Carbon Disclosure Project) that was released on July 10, 2017, the headlines of which were shared around the Internet, including by a widely cited The Guardian article released the same day.
This newspaper article has been disseminated by activists and commentators around the Internet, including me, and since it has received some rightful criticism over the last year for being inaccurate, I figured that there was some due diligence owed on my part.
Before we get started, it should be noted from the onset that estimating the total number of emissions produced by greenhouse gases is not actually straightforward. The CDP had some entities provide tallies willingly via public reporting while others had to estimate. That doesn’t discredit the CDP’s information, but it does tell you that there is a level of estimation going on.
Yet regardless of what the actual number is, these 100 companies, which relate to the cement and fossil fuel industries, have contributed significantly to climate change. None of the information I am going to dive into discredits that reality, and so, while we should always demand our information be accurate, be wary of those who use a discussion of numbers to sidestep the harm these companies and state institutions have perpetuated.
And so we are going to be talking about why this popular meme about the environment is wrong and why it might not matter.
No, it’s not all emissions
“…71% of Global emissions are coming from only 100 companies”
The most immediate caveat that has to be made with this statement is what we even mean by a company. While many of these entities are structured as for-profit businesses, a plurality, like the Assets Supervision and Administration Commission in China, falls under the administration of states themselves or are state-owned businesses like the Saudi Arabian Oil Company, where most of the shares are owned by the Saudi Arabian state. As written by Lloyd Alter in Tree Hugger:
“The first point is that if you look at the actual list in the report, Exxon and Shell are the only private companies to even make it into the top ten; the rest are all government entities. China (Coal) is by far the biggest emitter of them all at 14.32%; fully 18.1% is just Chinese, Russian and Indian coal, so it’s incorrect for anyone to say “just 100 companies.” We are dealing with national governments and the entities that they own.”
To me, this counter is disingenuous. I may alienate some people by saying this, but the state capitalism of China is not communism (defined as a moneyless, stateless society where the means of production are controlled by workers). Electricity is still a service residents mostly have to pay for in places like China. These services are still working within the global capitalist system, even if many of them are owned and operated by the state. It would be like saying the goods you buy weren’t participating in capitalism because they were transported on a state-built road or carried via a government packaging service.
But if you read The Guardian headline and came away with the conclusion that investor-owned companies like ExxonMobil are the main direct contributors to these emissions, well, that’s just not true. The situation is a tad more nuanced than that — as reality tends to be.
However, this disagreement is small compared to the larger and most consequential clarification, which is that the CDP study was only focusing on industry GHG emissions. The study discounted emissions relating to land-use change (e.g., the altering of the landscape via deforestation, urbanization, afforestation, etc.), methane deriving from farming, landfills, and other non-industrial sources. If you are like me, wondering what non-industrial sources even mean, it appears to be anything outside emissions that result from company-owned facilities and vehicles as well as the use of sold products.
And so, if you are using this number from The Guardian piece to mean all emissions, again, that’s not very accurate. Industrial emissions are still a substantial amount — 15% of the US economy according to EPA data from 1990–2021 — but it’s fair to argue that as a slice of overall emissions, these 100 companies may be much lower than 71%.
In the United States, the Industrial GHG emissions figure is estimated to increase to 30% (again, according to information from the EPA) when you factor in “end-use electricity” — i.e., the energy directly consumed by the user (the very thing done in the CDP study). That number is roughly the same globally. That is not the 71% some have shared, but it’s still significant. If we extrapolate the CDP percentage onto the EPA figure, that’s still 21% of the entire economy. We are talking about potentially a quarter of all emissions since 1988, at minimum, being caused by just 100 companies.
And yet, even here, there is more complexity because we have to dive into whether we agree with both the CPD’s definition of industry emissions and the data they used to get their results.
Into the weeds, we go
The amount of emissions considered industrial depends on how you slice and dice the numbers. There are many indirect scopes besides just the “various facilities and vehicles these companies own” and the “use of sold products.” Do you factor in the electricity, heating, and cooling the companies purchase from other entities to maintain their operations? How about the transportation of these company’s employees? Does the transportation and distribution of their products come into play?
None of these scopes were included in the CDP figure, and yet, I must stress that there is a good case to be made that they deserve to be included. These emissions may be difficult to quantify, and double-counting is an issue, but that doesn’t cause them to go away. If one does count them, the number these companies contribute to total emissions might be much higher — although that is entirely speculation on my part as I have not run the numbers.
There is also a more, shall I say, philosophical issue of whether you count the consumer into industry emissions or not at all. According to Politifact, in its initial debunking of this claim, the majority of fossil fuel emissions are from the consumption of these products. As Ellie Borst clarifies: “…direct emissions that come from company operations, such as extracting and refining oil, typically account for around 12% of a “carbon major” company’s total emissions. The other 88% comes from the consumption of the products.”
From my perspective, we probably should add the latter information into industry emissions because not doing so contributes to the unhelpful framing that climate change is mainly a consumer issue (a framing the fossil fuel industry has promoted for decades). After all, it seems sort of silly to say that these companies that extract all of this oil and gas — and have lobbied governments around the world to kill energy alternatives — are not doing so under the expectation that it will be used. It’s not like your typical consumer has much agency on how to heat or power their homes.
Here, we have bumped into a philosophical issue on how data should be counted — one that is ultimately a political decision that will be settled in the voting booth, the courts, and the streets.
Furthermore, there are issues related to how you factor not just the emissions that come from the production of oil and gas but also leaks from these companies’ infrastructure. For example, Our World In Data conservatively calculates 5.8% for “fugitive” emissions (i.e., unintentional and undesirable emission, leakage, or discharge of gases or vapors from pressure-containing equipment or facilities and from components inside an industrial plant, not all of which comes from the fossil fuel industry).
However, recent studies have indicated that these emissions might be much higher than this figure. As reported by Ask MIT Climate, “a 2022 study focused on gas production in New Mexico, a group of Stanford researchers estimated that leaks equated to more than 9 percent of all production in the area, based on aerial surveys.” The consensus on this is simply not at a level where we can comment on a number with exceeding confidence. We will probably be arguing about this number for generations.
Again, there are countless ways to slice and dice the numbers, and while it is misinformation to uncritically share the 71% figure as a total figure of all emissions, I still am wary of those who want to massage these emissions as an entirely consumer-driven problem, which is exactly what Politifact does in its fact-checking. Despite sharing criticism from the study’s co-author, Ellie Borst ends her piece by saying: “The study tied emissions from consuming “carbon major” products to the companies that produced those products. So, in theory, everyone driving an electric car would create less demand for gasoline and decrease companies’ emissions.”
From my perspective, this framing is reckless and irresponsible as it tries to shift the burden from these companies, which have substantially more clout over our politics, to the individual consumer — a neoliberal argument that centers the problem on one of individual preferences. We have to be careful not to rely on such a framing even as we search for the truth.
A warming conclusion
I am a layperson, so I do not know how you take all of this information and turn it into one number. If there is a figure that factors in all these points we have talked about, externalities, as a classically liberal economist might call them, I have not found it. As Borst says: “Research that accurately compares the total global emissions to the data collected from the 100 most-polluting corporations worldwide does not exist yet.” Though please share your favorites.
And none of this goes into the social cost these entities' propaganda has had on our overall system’s emissions. ExxonMobil, which showed up as number five on the list in 2017, knew about the fossil fuel industry's effect on global warming since the 70s. It has engaged in astroturfing denialist think tanks and activists so they could avoid regulation, and we can say the same about many actors in this industry.
How do you factor in the pollution these companies have added from convincing our society not to change its patterns of behavior? Can you?
Regardless, I still think we have a duty to share accurate information, and I apologize for sharing the 71% figure as a total for all GHG emissions rather than just industry GHG emissions from 1988 to 2015. This was untrue, and I (and the activists I consider comrades) do not get a pass when it comes to the sharing of misinformation.
All this being said, however, do not lose sight of the fact of where the blame lies. These companies, regardless of whether they have contributed to 21% of total GHG emissions or 70%, bear tremendous responsibility for our warming world.
And that’s a fact you can take straight to the fact checker.