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When you're a big brand on the path to a righteous green future, you will surely face scrutiny. It's hardly surprising, then, that Greenpeace is claiming that Tesco has fallen foul of greenwashing its diesel fuel.
The environmental group says that Tesco is making false claims about the source of the green fuel sold in its petrol stations. Greenpeace sent a sample of fuel taken from an Edmonton filling station on 3 April to an independent lab in Germany. Tests found that the 30 per cent of the biofuel in Tesco diesel was derived from palm oil, the remainder from soya. Meanwhile, The Times has reported Tesco as saying that it did not use palm oil in its biodiesel, only rapeseed and soy.
The problem with palm oil is that it's typically grown on newly deforested land. In Southeast Asia, where most of the palm oil comes from, this means replacing rainforest and peatland forests with palm monocultures. Greenpeace reckons that burning Indonesia's peatlands to make way for palm forests accounts for four per cent of annual global emissions. Palm oil is also used in cosmetics and convenience foods. A study by the University of Minnesota, published in February 2008, found that growing biofuel on converted rainforests, peatlands, savannas or grasslands created up to 420 times more carbon dioxide than it saved.
In the future Tesco, which accounts for 13 per cent of the UK's petrol and diesel sales, will be obliged by the government's Renewable Transport Fuel Obligation (RTFO) to state where its biofuel is sourced from. But it won't be until 2011 that sustainability standards are in place, which will probably preclude the use of palm oils from deforested land. The RTFO, which was introduced on 15 April, makes fuel suppliers legally obliged to ensure that at least 2.5 per cent of petrol and diesel sold in the UK comes from crops and organic waste. Tesco diesel contains five per cent biofuel.
In another recent mini-scandal, Tesco was blamed for having palm oil in its biodiesel. Fuel supplied from a number of Tesco service stations contained silicon, which caused engines to seize up, costing the supermarket millions of pounds in damages.
The perception of brands being green is fickle. In a recent survey by Chatsworth Communications of 1,500 opinion-formers in the media, Tesco was ranked the second most likely FTSE100 company to greenwash. Rival Marks & Spencer was ranked the greenest brand. In a September report on the greening of greengrocers by the National Consumer Council, Tesco was given a C-grade, meaning "showing potential". M&S, Waitrose and Sainsbury's were top with B-grades, meaning "good". The criteria included climate change, waste and sustainable fishing and farming.
But despite Tesco not performing well in green surveys, Tesco CEO Sir Terry Leahy is frequently presented in business magazines and newspapers as a green champion. In January 2007, Tesco pledged to triple its recycling, spend £500 million to cut in-store energy use by 50 per cent from the 2000 levels and to halve greenhouse gas emissions by 2020. Its current emissions are around 4 million tonnes of CO2 equivalent (including other greenhouse gases). Other plans include installing on-site renewable energy systems, launching a £100 million climate technologies fund and carbon labelling products. The supermarket giant has also adopted electric vans, launched an initiative to sell low-energy lightbulbs for a penny and has also joined the Carbon Disclosure Project.
We think the problem facing highly visible companies like Tesco in their quest to be green is that despite strong leadership, middle management is often responsible for procurement and policing products. This is where the mistakes are most likely to happen. The senior management should be open when the mistakes happen, limiting the PR damage. There's nothing like a greenwash scandal to turn customers against their suppliers.
Let us know what you think in the comments below -- are we giving big brands too hard a time when they're obviously changing their ways? Or are the mistakes they make in green procurement due to a lack of commitment to real change?
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Discover the brilliant experienced people who are helping SmartPlanet through the green and ethical minefield.
