European Energy Majors Hide Nearly Half of Their Damage to Biodiversity, Researchers Find

Some companies plant palm oil trees for biofuels in tropical areas like this region in Indonesia adjacent to the Padang Sugihan Wildlife Reserve, pictured on Dec. 13, 2018. Faizal Abdul Aziz / CIFOR

A new study has found that large energy companies in Europe hide 47 percent of the damage they cause to biodiversity through their activities.

The researchers analyzed nearly 50 events related to 30 major European energy companies — from deforestation and habitat destruction to the electrocution of birds — and discovered that 22 of them were not even mentioned in the firms’ sustainability reports, a press release from University of the Basque Country said.

“European directives oblige large companies to publish documents relating to the environment and biodiversity, but the information that has to be included in them is not fully specified. Each company decides which aspect to cover. So they act freely and soften their image,” said lead author of the study Goizeder Blanco-Zaitegi, a Ph.D. student with the faculty of economics and business at the university.

The researchers found that energy companies disclosed just 23 percent of events threatening biodiversity in a clear manner.

Some events were communicated in a vague manner. Across 14 cases, they revealed that — in 30 percent of adverse impacts analyzed — companies used strategies to minimize their actions and neutralize their responsibilities.

Blanco said the most common technique companies used was to emphasize their positive efforts and good aspects.

“For example, palm oil trees are planted by some companies in tropical areas to produce biofuels, and this destroys the local ecosystems. However, in their sustainability reports they divert attention towards softening the issue,” Blanco said in the press release. “They emphasize that they have planted numerous trees in other areas. And that does not make up for the deforestation caused by the company as a result of palm oil trees, among other things, because the plantations are located far from the damaged sites.”

Energy companies also made the argument that it wasn’t clear who was responsible for the destruction or blamed other actors, such as the suppliers.

The research team found that transparency varied by type of event, with energy companies explaining events affecting Indigenous communities and the electrocuting of birds more accurately.

When birds are killed by power lines, there are fines. Because it isn’t hard to account for them, companies also tend to report their deaths more accurately.

However, Blanco said this doesn’t apply to more complex issues, such as when ecosystems are transformed or destroyed.

“[F]or example, if a wind farm has been built on the migratory corridor of a species, they do not communicate it clearly. As the effects are deeper and more difficult to measure, they tend to conceal these events.”

The study, “Impression management of biodiversity reporting in the energy and utilities sectors: An assessment of transparency in the disclosure of negative events,” was published in the Journal of Behavioral and Experimental Finance.

“[I]t is more difficult to be non-transparent when humans are involved. People, unlike nature, speak, protest and engage in confrontation. Such events have to be communicated,” Blanco said.

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