Action Guide

Assess Your Trade Associations

Environmental Defense Fund

Alignment with trade associations is key to avoiding greenwashing. Companies should evaluate whether their trade associations support their climate objectives and initiate dialogues to address any misalignment.

Good climate policy helps companies manage risk, be more resilient and adaptive, and advance on their sustainability commitments and net-zero goals. Trade associations are powerful tools that companies utilize in their lobbying, but their positions on climate may not always align. A company that is serious about climate could risk being accused of greenwashing if they are members of a trade association that advocates against climate policy.1 That is why it is important for companies to understand how they can leverage their membership in a trade association to advance their policy positions on climate and to correct policy misalignment.    

To do this, a company can assess how a trade association’s actions and lobbying align with its climate policies. Companies can then determine if the trade is lobbying against the company’s climate policy interests. Companies can use the assessments to initiate dialogues with trades to address misalignment over climate policy.  

Companies can follow the guidance below to enhance or begin their trade association assessment journey. The resources referenced throughout are listed in detail at the bottom of the page in the Assessment Resources Deep Dive. 

The Assessment Journey

  1. To begin assessing trade association alignment, companies must have well-defined science-based climate policies that articulate their net-zero and energy transition goals. 
    • For examples of climate policies, look to Race to Zero’s “net zero policy” (Resource I), Unilever’s climate policy engagement review (Resource II), or Apple’s detailed policy page (Resource III).  
  2. With policy priorities established, companies must determine how they will conduct their assessment.
    • The Exponential Roadmap Initiative (Resource V), in partnership with groups like Race to Zero, We Mean Business, and the World Business Council for Sustainable Development, has developed a step-by-step roadmap with three main phases:
      • Assess Alignment: Commit to science-aligned climate policy engagement, assigning accountability, mapping memberships with trades, and assessing association alignment. 
      • Work Towards Alignment: Determine a strategy to accelerate alignment, execute your strategy, and disclose.
      • Accelerate Climate Goals: Reward well-aligned associations and engage in climate-aligned initiatives. For more on this process, check out InfluenceMap’s (Resource IV) criteria for assessing trades, including their database on trade association lobbying.2 If companies want more help in developing methodologies for assessment, they can follow Unilever’s approach of hiring a third party to audit the trade association’s positions (Resource II).   
  3. Companies should create a plan that includes a timeline to develop the assessment, and a structure to facilitate coordination among relationship managers for trade associations across the company. Assessment reports may take several months to complete. Policies change quickly and tactics to address misalignment must be prioritized. That is why it is important to constantly refer to this plan and conduct the assessment as frequently as possible – ideally annually. 

Case Study

Apple

Apple’s Environmental Progress Report includes more than 20 climate policies and actions as part of their 2030 climate policy platform (page 71). This report is a strong example of a company showing what it intends to advocate for and making a clear connection between good policies that can help its business.  

Addressing Misalignment

As trades are assessed, companies must think about how they want to address misalignment. Policy misalignment is a delicate topic. Companies must take care to preserve the relationship with the trade association while addressing misalignment. The best outcome of an assessment would be for the trade association to promote climate policy in alignment with the company’s policy priorities. 

Tactics that could help address misalignment include: 

  1. Discuss misalignment with the trade association. Make your climate policy positions clear to the trade. Explain the accountability mechanisms your company will put in place, which could include closer monitoring of the trade association’s lobbying activities or requesting a full list of meetings and interactions with policymakers. 
  2. Develop a roadmap with the trade to correct the misalignment. 
    • Create a set of principles, guidelines, or talking points for trades to adhere to in public messaging and lobbying efforts.
    • Understand the frequency of a trade’s climate lobbying, if any, and any consistent patterns of positive engagement. Trade associations can hide behind one-off positive lobbying or statements. Companies should not only address negative lobbying but also any lack of consistent, positive lobbying. BHP provides a good example of due diligence to determine the frequency of the trades’ climate lobbying (Resource VII). 
    • Another nuance is passive versus active alignment, which Unilever directly addresses (Resource II). Passive alignment refers to when a trade’s positions may be in line with a company, but the trade is doing nothing to promote good climate policies. Passive alignment should be a minimum threshold, but companies should encourage trades to go beyond a “do no harm” mentality and take stronger leadership to advance climate policy.  
  3. Coalesce with other members of the trade to project a louder voice on climate policy priorities. Determine with them how you’d like to communicate your shared values on climate policy and how to address this with the trade. 
  4. Request a breakdown of how your dues are being spent. Request that your dues be spent only on lobbying towards the issues where you are aligned. Do not let your dues contribute towards a trade association’s political giving.  
  5. As a last resort, if alignment conversations are not progressing, leave the trade association. 

Additional guidance is available from The B Team, which has a special guide to help companies address misalignment and begin those conversations (Resource VI). 

Once a company has gone through the assessment, setting up mechanisms for communicating this information to investors and stakeholders is key, as demonstrated by BHP (Resource VIII).  

Presenting this information in an easy-to-digest way will lead to a better understanding of the assessments conducted. For example, Microsoft clearly visualizes how the associations score (Resource IX), and Unilever gives a write-up for each association (Resource III). These methods help stakeholders better understand the assessment’s findings.  

Case Study

Unilever

In the company’s Climate Policy Engagement Review, Unilever provides a table that represents how they score each trade to determine if they should be assessed (page 10). Unilever details more of their methodology in scoring, placing trades in sections based on the level of engagement and misalignment with Unilever’s policy priorities (page 13). This method is a strong way to understand the trades that may have a large, negative or positive impact on Unilever’s own climate policy goals. Lastly, Unilever provides a write-up of each trade and provides a helpful explanation for stakeholders. This criterion resembles InfluenceMap’s disclosure template for trades. 

  • The specific positions or advocacy the trade has conducted
  • How the report’s author perceives the trade’s lobbying based on their assessment
  • A clear explanation of how Unilever plans to address misalignment  

Assessment Resources Deep Dive

As referred to throughout this guide, these resources provide greater detail on the best resources for companies conducting trade associations.

Resource I - Race to Zero’s Net Zero Policy

Race to Zero’s 5th P Handbook provides examples of net zero-aligned policies available to non-state actors: carbon pricing, a phaseout of environmentally harmful subsidies, and support for stronger national climate targets or nationally determined contributions (NDCs) (page 46). Race to Zero then details by sector the “2030 Breakthrough” policies, or sectoral 2030 goals and actions that would bring each sector in alignment with the climate goals of the Paris Agreement, if met, as outlined in the Marrakech Partnership (page 52).

Resource II – Unilever’s Climate Policy Engagement Review

Policy Priorities: Unilever identifies three “cross-cutting policies” that support economy-wide transformation (page 3) and then details the advocacy steps they have taken to ensure policy progression internationally. These priorities are clearly stated and marked for stakeholders to see, in addition to disclosing the steps Unilever is taking to ensure these policies get implemented.

Third-Party Audit: Unilever commissioned Volans to independently conduct the industry association review. By doing so, we believe Unilever was able to take a large burden on the project off their shoulders in addition to removing any bias that may exist in their own research. Entities like Volans are helpful in crafting strong assessment methodologies.

Passive versus Active Alignment: Unilever explains their rationale for taking a passive approach to trade alignment, meaning the trade association doesn’t lobby for climate policy, but it’s also not misaligned with the company’s policy. However, Unilever encourages trade associations to be more active on climate policy (page 2). 

Resource IV – InfluenceMap Corporate Policy Engagement Disclosure Scorecards

InfluenceMap has created a methodology for assessing corporate policy engagement disclosure, which includes a section on trade associations. It includes a scoring chart, with criteria for addressing company-trade misalignment – with the best score resulting in the company identifying all cases of misalignment. Their disclosure template lays out a table for companies to use to assess trades (page 7).

Resource V – Business Association Climate Action Guide

This resource was created by a coalition that includes Race to Zero, We Mean Business, and the World Business Council for Sustainable Development. It provides a step-by-step process for how to align trade associations with positive climate policy engagement. Especially helpful is the guidance for mapping memberships, assessing association alignment with science-aligned climate policy, and strategies to accelerate alignment (page 6-9). It provides a helpful outline to develop your trade association alignment assessment. Most of these steps are aligned with the expectations set out in the Investors’ Global Standard on Responsible Corporate Climate Lobbying. 

Resource VI – Addressing Trade Association Misalignment on Climate Policy

The B Team developed this resource for companies to bring their trades in line with their own climate lobbying. It provides a menu of options companies can take, including developing asks for trades (ways to assess them by speaking with them about their climate lobbying), how to communicate with them, and what follow-ups companies can take (page 3). The report provides draft communications to a company’s trade and peers on this journey (page 4). The rest of the report (pages 5 onward) lists specific policy positions and initiatives companies can encourage their trades to support.  

Resource VII – BHP Industry Association Review June 2023

Under their “Methodology” section BHP lays out how their assessment was conducted, including the use of a third party to gather information (page 4).  In their assessment, BHP considered, “the consistency and trajectory of association advocacy (e.g., does the identified misalignment fit within a broader pattern of association advocacy, or does it appear to be more of a one-off? Has the advocacy of the association in relation to the identified misalignment improved over time?).” 

This important step addresses a trend amongst associations where they simply message around climate policy without proving or demonstrating a concerted effort to promote good climate policies over time. Holding associations to a consistent and positive lobbying pattern is key to ensuring they are helpful and not obstructive.  

Resource VIII – BHP Industry Associations

BHP has created an entire webpage detailing their rationale behind their membership in industry associations, their governance practices, their climate priorities and addressing alignment, and how they communicate this information to its stakeholders and investors. This online resource is critical for stakeholders who may be curious about how a company approaches this topic and all the information is laid out in one place – in addition to the actual associations review.  

Resource IX – Microsoft Sustainability Policy Alignment 2024

Microsoft clearly lays out their policy priorities and gives a brief description of each. Those priorities are lined up with their assessment for each of the trade associations assessed. That way, stakeholders can clearly see what is aligned and what is not.

Footnotes

  1. Trellis | Companies Risk Greenwashing with their Trade Group Activities, Report Says
  2. InfluenceMap | LobbyMap Scores