GARY RYNHART: Hopes pinned on corporate ESG plans to force airlines to cut emissions

The airline industry is recovering to prepandemic passenger levels in most markets, but while other sectors have been changed to varying degrees by the Covid-19 disruption, not so the aviation sector.

Remarkably, it is one of the few industries whose core product has changed little in the about 70 years of commercial travel.

While air travel is far safer and cheaper than it was, can anyone say, hand on heart, that the experience is better? Glamorous it is not. Michael O’Leary, CEO of Europe’s biggest airline, Ryanair, summed it up in remarking that “we should try to eliminate things that unnecessarily p*** people off”.

Aviation is one of the few sectors that got something of a free pass in terms of environmental scrutiny. While it accounts for 2.5% of global CO₂ emissions, its overall contribution to climate change is higher, as air travel emits other gases — nitrous oxides, sulphur dioxide and water — and particulate matter (soot). 

The figures are further clouded by how emissions are counted — CO₂  from domestic flights is included in national emission accounts, but international flights have their own category: “bunker fuels”. There are thus few incentives to reduce such emissions. And, unlike the most common greenhouse gases — carbon dioxide, methane or nitrous oxide — aviation’s other emissions are not included in the Paris climate agreement.  

There appears to be little urgency in the sector to move towards other fuel sources. Companies such as Airbus have grand plans to develop hydrogen aircraft  within 15 years, but this seems a stretch. The first flight using sustainable “e-kerosene” took place in 2021 and only used 5% of it in its fuel mix. According to a paper from the International Council on Clean Transportation, at most 5.5% of aviation fuel in the EU could come from sustainable sources by 2030, largely from advanced waste biofuels. Synthetic fuels have more potential to be scaled up, but production is minimal.   

Top concern

Compare this with the global car sector, where there is huge commitment to shift production to electric vehicles, driven by the prospect of regulation and taxes aimed at decarbonising the sector. No similar threat hangs over aviation. The only major global policy to address aviation emissions has been an offset scheme developed by the UN’s aviation agency, the Carbon Offsetting & Reduction Scheme for International Aviation. However, this scheme has long been considered inadequate.  

Awareness of the negative environmental impact of flying is increasing though. A 2022 McKinsey survey of more than 5,500 air travellers worldwide showed that emissions were the top concern of respondents in 11 of the 13 countries polled, and almost 40% of travellers were willing to pay at least 2% more for carbon-neutral tickets. Yet this is not reflected in consumer behaviour; airfares to the major hubs are comparable to those of a decade ago, due mainly to enormous demand. 

Corporate behaviour also appears to be saying one thing and doing another. According to the second edition of the 2023 Travel Smart Ranking  on business travel — tracking commitment, emissions and reporting performance to reduce corporate air travel emissions — 85% of global companies and organisations such as the UN lack credible plans to reduce flying emissions. The yearly ranking is published by Travel Smart, a global campaign that seeks to get companies to reduce business flying emissions by 50% or more from 2019 levels, by 2025 or sooner.  

Yet change is inevitable, certainly for corporates. There is increasing displeasure with using offsets as an environmental, social & governance strategy, and due to increased legislation on greenwashing it is unlikely to be sustainable. While business travel is slowly edging back to where it was, virtual meetings appear to have replaced travel to some extent.

The core flying experience is unlikely to change, with aviation experts pointing to decades of short-sighted decisions that prioritised efficiency and price cuts over quality and comfort. As airports get busier over the next decade, if they can take a meeting online many executives will choose that option. 

• Rynhart is senior specialist in employers’ activities with the International Labour Organisation, based in SA.