To dread or not to dread? Introducing Amazon’s $2 billion Climate Pledge Fund

Calls such as “break free from fossil fuels” emblazoned across signs were a common sight during the climate strikes in September 2019. Over 1,500 Amazon employees took to the streets to publicly criticise the world’s largest online retailer for their unresponsiveness towards the growing climate crisis. In April 2019, more than 8,000 employees signed an open letter to Amazon founder and CEO, Jeff Bezos, asking the company to adopt a diverse climate plan. Some of the upshots the letter called for included increased lucidity of climate goals and the cessation of donations to climate-delaying legislators; Amazon donated to 68 members of congress in 2018 who have always voted against climate legislation. Following the company walk outs and the collective letter, Amazon announced The Climate Pledge in September 2019. In this pledge, the company committed itself to use 100% renewable energy by 2025 and achieve carbon neutrality by 2040, 10 years ahead of the Paris climate agreement. Conversely, rival Microsoft pledged to become carbon negative by 2030.  

On 23rd June 2020, Amazon announced its $2bn Climate Pledge Fund to support their promises. The fund will support the development of sustainable technologies and services to enable Amazon and other companies to meet the goals set out in The Climate Pledge – notably, the commitment to be net zero carbon by 2040.

The Good

There are reasons to be optimistic about the venture fund. With Amazon currently inviting a diverse range of companies to show interest in the initiative, from ‘pre-product start-ups’ to ‘well-established enterprises’, there is undoubtedly potential for far-reaching positive impact if the fund is implemented correctly. Many clean energy innovation researchers have praised the move, suggesting that it will complement other existing funds like Breakthrough Energy Ventures, which is worth $1 billion. Dan Reicher, a former director of climate initiatives at Google and a senior research scholar at Stanford University lauded the investment as being “helpful and timely,” and particularly effective if used alongside public dollars.

The Bad

Naturally, others are not convinced. Amazon is a company which has vehemently emanated controversy in recent years and continued to dominate media headlines. In an email shared at the start of this year, Amazon employee-turned-activist, Maren Costa, risked “formal corrective action” if she continued to criticise the company’s climate response (The Guardian, 2020). This has vetted a mixed picture for the estimated $810 billion company, and naturally eluded to scepticism around the company’s true attitude towards green ventures.

The Ugly

As part of its Climate Pledge, the company would be ordering 100,000 electric delivery trucks from Rivian. Ironically, this is a Michigan-based start-up which Amazon has invested in. Furthermore, the company also quietly released its 2019 sustainability report on the same day the announcement of the fund came. It revealed that the total carbon emitted by the online retailer, founded in 1994, had actually reached 51 metric tonnes of CO2 equivalent waste; this is an increase of 15% from 2018. Some key findings from the revealed sustainability report can be found below.

Matt Nisbet, a professor who has studied the role of philanthropists in climate change policy accentuates the “huge PR, greenwashing aspect” that cannot be overlooked, in his email to E&E news. Many activists and employees have accused Amazon of greenwashing, following the company’s controversial partnerships within the fossil fuel industry and contribution to diesel pollution, hitting communities of colour the hardest. This has led Amazon Employees for Climate Justice, an employee-activist group, to advocate that the new venture fund should find ways to “reduce emissions in frontline communities” and focus on environmental justice as opposed to “technocratic” solutions (Medium, 2020).  

Matt Nisbet also went on to explain how the fund may not necessarily be a net positive for emissions if directed by the world’s richest person, Bezos. He suggests that governance of the fund, and ultimately a large portion of the climate change response, would become concentrated in a way which “threatens a basic principle of democracy.” According to the Bloomberg Billionaires Index, Bezos has a total net worth of nearly $178bn. If Bezos’ wealth continues to grow at a yearly rate of 34%, he is on track to become the world’s first trillionaire as soon as 2026 (Comparisun, 2020), according to an analysis from Comparisun. Indeed, this raises unease around the governance of the fund for many. Instead of starting the fund, activists have called for Amazon to withdraw funding from think tanks hostile to climate action to show real commitment instead.

Final remarks

Overall, it appears that the Fund could indeed chiefly be an advantageous move for Amazon, but this does not entirely negate the positive implications it could have for a cleaner planet. There is likely to be a helpful impact, albeit one riddled with controversies surrounding governance and credibility.

By Asha Pandit

References:

Amazon, 2020. All In: Staying The Course On Our Commitment To Sustainability. [online] Amazon. Available at: <https://sustainability.aboutamazon.com/about/report-builder>

Comparisun. 2020. The Trillion Dollar Club | Comparisun. [online] Available at: <https://www.comparisun.com/resources/the-trillion-dollar-club/>

Medium. 2020. Amazon Employees For Climate Justice – Medium. [online] Available at: <https://medium.com/@amazonemployeesclimatejustice>

The Guardian. 2020. Amazon Threatened To Fire Employees For Speaking Out On Climate, Workers Say. [online] Available at: <https://www.theguardian.com/technology/2020/jan/02/amazon-threatened-fire-employees-speaking-out-climate-change-workers-say>