US Climate Bill has Myriad Opportunities for PR, But SEC Proposal is Danger for Greenwashers

Climate change, energy and environment are topics du jour. Reasons for this are plenty and sobering.

Examples of apparent climate change-induced weather disasters abound this summer.

Moreover, there’s been no bigger energy story than the war between Ukraine and Russia. As prices for natural gas and electricity reached record highs this summer, concerns for the winter create headlines, especially in Europe.

At the same time, the energy crunch, though modestly covered in U.S. media so far, has global potential.

In addition, as pandemic assistance fades, Americans are behind on energy bills. The average balance owed on unpaid utility bills, $792, is nearly 100% more than it was in 2019. Indeed, 20 million U.S. households–1 in every 6 homes–are behind, the National Energy Assistance Directors Association says.

Massive shut-offs in the U.S. and Europe for delinquent customers this winter seem a strong possibility.

The global energy crunch has spurred debate over governments’ progress in promoting low-carbon fuel alternatives. Indeed, some of the biggest oil and gas producers are making environment-friendly pledges.

However, climate change, energy and the environment are on communicators’ minds for another reason. In mid-August, Congress approved President Joe Biden’s Inflation Reduction Act (IRA), which includes $369 billion in investments for climate change and related issues. IRA’s arguably the largest climate bill in the country’s history.

As a result, PR pros are wondering what IRA means, both for companies that have undertaken environmental activities and those getting started.

  • Should PR pros change communication tactics and strategies as a result of the IRA?
  • Indeed, should they mention the legislation in climate-themed narratives or rely on a more general environmental message that may resonate across party lines?
  • And what about greenwashing?

As with so much of PR, answers to several of these questions begin with “It depends….”

Not Green Overnight

First, some context. Though PR pros, depending on the company they represent, should consider prioritizing environmental issues and becoming familiar with the IRA promptly, understand the bill won’t turn the U.S. green overnight. Its focus is on carbon emissions. And it has gaps.

“Oil and gas will still be here in five years. [And] they’ll be around in 50 years,” says Jake Rozmaryn, chief growth officer at Antenna, a PR and marketing company with an extensive climate and sustainability portfolio.

Also, it will unlikely change climate-deniers’ minds. So, like Roe v. Wade, it’s an issue where audiences likely will hold different opinions.   

And, opinions differ within each side of climate questions.

Yet Sandra Ericson, EVP, rbb Communications, believes the IRA “is a wonderful first step,” but concedes, “it’s really just step one.”

Similarly, Lindsay Singleton, managing director, ROKK Solutions, and leader of its social impact and communications practice, agrees the IRA is a start, but “more needs to be done.” A slew of new policies are needed before the country reaches net-zero emissions.

Still, while climate change and environmental communication may not be your top priority, it should be near the top. “Time is definitely of the essence,” Singleton says. “Consumers and stakeholders, including investors, want to see that you’re acting...the question is, what is the proper action?”

What the IRA Offers

What the IRA provides is financial incentives for business, individuals and families. As such, it encourages adopting environmentally-friendly practices and technologies. Moreover, in some cases it lowers the cost of entry.

For companies that have begun their climate journey, it encourages them to do more, Rozmaryn argues.

Many Roads to Green

What the IRA avoids is penalizing companies that don’t invest in cleaner energy. In addition, it doesn’t lay out an immutable plan toward a cleaner country, which, some argue, is a good thing.

They say this because there’s not one, undisputed route to climate success. And, so, there are heated disagreements between environmental groups, people who acknowledge Mother Earth needs help.

For example, should clean air/climate change take precedence over clean water? Are federal efforts the best route, or will the country’s air get cleaner, faster, through state and local action? Should sustainable food get priority over clean, renewable energy? What about the fact that most ESG investors also own cryptocurrency, whose use of electricity and thus fossil fuel is significant? And whose solutions and technologies offer the best chance of effecting change?  Is it cool to place wires in forests as a means of delivering clean electricity?

On top of this are disagreements over financial issues. Who will pay for environmental activities (assuming there’s agreement on priorities and methods)? Government? Companies? Should companies and governments concentrate on where they are located? Or, should certain parts of the globe receive help first?

Moreover, there’s the question of scope. Environmental concerns and climate technology properly applied should touch every part of the planet and business, Rozmaryn says. “It’s no longer just solar or wind power or LED…it’s a Herculean task,” he adds.

More than that, Rozmaryn believes there’s another consideration. The crossover between the E and S in ESG is “massive,” he says. This is so because climate issues disproportionately touch lower-income and historically marginalized populations.

“Social justice is such a huge topic now,” he says. “So, if you are a corporate communicator” that hasn’t addressed your company’s environmental footprint in “a marginalized community…you’re gonna get huge pushback from your constituents.”

A Partisan Issue?

And, of course, we’ve covered just one side of the story. “Not everybody agrees there’s a [climate] problem,” Ericson says. Indeed, recall that the IRA received no Republican votes.

As we know, climate change and related environmental topics are highly polarized issues. Climate opponents appeared long before the IRA. Their arguments often begin with finances. For example, some critics argue climate change is too costly.

Another argument is more general. It holds that woke factions overtook society and forced acceptance of ESG on business. This camp believes ESG is a hoax that ultimately will destroy the U.S. energy sector and shareholders’ financial returns.

Accordingly, late last month Texas began boycotting companies that it claims are targeting the fossil fuel industry.

Ericson and Singleton, though, believe climate and environmental issues, when framed carefully, can transcend politics. Ericson cites research from Yale's program on climate change communication when she says some “90 percent” of Americans favor saving the planet from global warming, “even if they disagree about or don’t know” how to get there. Indeed, the 90% is divided into 5 groups in a fascinating piece of research.

Somewhat similarly, Singleton points to ROKK research that shows ESG issues cross political lines.

A Non-Partisan Issue?

For example, a survey of some 1,200 voters, shows “voters on both sides of the aisle are highly supportive and engaged on issues related to climate and environment, especially those under the age of 45.”

In addition, the research shows public opinion on ESG is not nearly as polarized “as [some] politicians and the news cycle” suggest.

For example, 79% of Democrats and 71% of Republicans believe companies should be responsible for bettering society. The majority of those surveyed prioritized environmental issues (66%), such as climate change. If you accept the above, the climate portion of the IRA has a chance of overcoming political polarization with careful communication.

Language Issues

It’s clear PR pros should craft inclusive messages on environmental issues (and just about all other topics, too). As such, Singleton recommends avoiding language that’s “too congratulatory about the IRA specifically.”

Instead, “talk...about what [your company] now is able to do [on climate change and the environment] without mentioning the [IRA] legislation…explain to consumers how you will act on climate goals…. Talk about [any] revisions to environmental and ESG strategies and goals and communicate those in a…proactive way.”

“We have seen that Democrat voters tend to really focus on language around climate change. And it’s not that the term necessarily turns off voters on the Republican side, but there are subsets of issues within the sustainability world” that attract Republican voters more, she says.

So, she encourages using phrases such as “energy management, waste management and water management. These are things that consumers and voters really like, because they are things that they care about.”

Consider What Resonates

For instance, in communities where droughts and floods are, or were, an issue, Singleton says, messages that specify “water management” as opposed to “climate change writ large” may resonate better. Moreover, citizens are “going to be supportive of corporate action that helps alleviate these problems; they’re going to be supportive of government action that mitigates those challenges.”

Messages aimed at Republican lawmakers could mention how their constituents care about your company’s climate activities. Similarly, craft messages about how your company’s action on the environment will help their constituents, Singleton advises.

Depending on your company’s situation, you might mount a thank-you campaign for legislators who supported the IRA, Singleton says.

Starting Points

Considering 2022 is an election year and the environment is a hot topic, it’s not a bad time for an inventory of your company’s environmental activities and messaging. For companies without an environmental track record, communicators should consider “what climate issues motivate your stakeholders,” Ericson says.

For communicators at smaller companies that haven’t done much environmental work yet, consider a self-assessment. Think about who you are as a company. What are your values and your products? Who is your audience?

“You don’t have to be all things to all people, but you have to be something to the people who matter to you,” Singleton says.

For example, “if my business is online dating,” says Singleton, “how do I connect that to water management? There might not be a clear connection.”

On the other hand, since online dating has a lot to do with technology, “maybe there’s a huge case to be made for focusing on sustainable internet…maybe that’s what my stakeholders care about.”

After that, consider what the IRA incentivizes your company to do differently. How will you take advantage of these new incentives? Rozmaryn says the incentives are key. “How will a company take advantage of these opportunities in front of it?”

ESG Pledges

Both Singleton and Rozmaryn say ESG pledges are a good starting point. Singleton says, “What are the kinds of pledges that we can make based on this new legislation? What are the actions that we know we can take right now and over the next few years, based on [the IRA]?”

For communicators at large, public companies that presumably already have an environmental program, much of this advice applies, Singleton adds. “You want to reiterate your commitments and showcase the growth. So, where we were, where we are now and because of the IRA, where we’re going, what this enables us to do.”

Not So New

In the end, Ericson, Singleton and Pazmaryn agree, environmental messaging should concentrate on what your audience cares about most. As such, it shares tactics with nearly any PR effort, Ericson argues.

For companies with environmental programs, Ericson urges monitoring climate- and sustainability-related content on the company’s intranet, newsletter or site. If an article is getting a lot of traffic internally or externally, then it’s an indication of stakeholder interest.

Similarly, Ericson urges that communicators build relationships with subject-matter experts within the company. “Is there someone in your organization who is talking to customers about [environmental issues], whether that’s legal, sales, customer service, brand development, R&D?” Converse with them. Ask what they’re telling clients or customers about the company’s environmental activities. Find out what employees are talking about in terms of how business might change.

In addition, ask, “what do customers [and employees] get excited about and what do you find works best” in such conversations?

People, Not Policies

Turning to message-crafting, Rozmaryn believes storytelling that centers on people, not policies, is the best approach. “Numbers and figures are good, but [used alone] they haven’t helped companies move the needle.”

Instead, “tell your climate story through the lens of people and families. Use narratives that are relatable to everyday life,” he says.

Similarly, Singleton likes storytelling, but prefers its compliment, story proving. “Take a compelling story or narrative and pair it with data that proves its impact. So, it’s about outcomes, not outputs.”

Too often, she says, “you see raw data and numbers, which can very easily get lost. Infographics without context doesn’t really mean really needs to be a combination of both [data and a relatable story] to get the message across.”

Ericson advises not to forget about visuals. She cites the video where a plastic straw was removed from a turtle’s mouth. “That’s really what spurred this move away from plastic amount of data or research or white papers was going to make such an impact,” she says.

Transparency and Greenwashing

It’s not a coincidence that each of our PR pros mentioned transparency. It’s obvious, of course, that ethical companies want to avoid greenwashing. Indeed, Ericson emphasizes that aspects of the IRA likely will change. “It’s the rule with government bills,” she says. As such, when communicators are planning their tactics, she says, “include plenty of wiggle room.”

Moreover, the Security and Exchange Commission (SEC) has proposed a set of rules that delineate ESG investing. Among the proposals is one mandating that companies provide extensive climate information. “This will result in a real standard around ESG reporting,” Rozmaryn says. The SEC proposals likely will bleed all over the environmental discussion, he predicts.

That’s important since there are competing standards in the green space. In some cases, various standards have provided room for companies' ‘interpretations’ of ESG's elements.

For example, companies that have changed their processes little could, under someone’s definition, claim they’re using 100% renewable energy. “Which could mean in practice they’re using 0% renewable energy; they’re just buying renewable energy credits,” Rozmaryn says.

He believes that sort of thing goes away should the SEC regulations go into effect.

Fortunately, there’s been a tech boom in tools that help monitor companies’ climate activities. In theory, accountability should benefit. It’s easier now to “create dashboards to benchmark against others, to verify where something came from and that it hasn’t polluted streams with chemicals or involved child labor,” Rozmaryn says.

“I can’t stress enough the accountability piece. Greenwashing is not an option when you have ESG reporting based on blockchain technology to verify every action a company takes and everything’s under a microscope and submitted to the SEC."