This week: Human climate niches; gold-standard nature targets; solar investment trumps oil.

Welcome back. Green claims are increasingly popular as they can help sell products and services, and sometimes even bring a price premium. But scrutiny of environmental claims is ramping up, too. Some companies have created so-called green panels to reduce the risk of greenwashing allegations.

Admitedly, the panels don't completely eliminate the risk of a greenwashing allegation, given there aren't any solid definitions of what it means to be low-carbon, carbon-negative or sustainable. The panels can, however, help companies avoid common pitfalls and demonstrate due diligence, which could be helpful in responding to or refuting any allegation that a business's green claims are overstated.

Why it matters

Environmental claims are increasing: Sales of consumer packaged goods in North America carrying sustainability labels totaled an estimated $269 billion last year, up 8.5% from 2021, according to NielsenIQ. And while customers seem to care more about sustainability, according to a survey by Google, nearly three-quarters of business leaders thought companies in their industry would be caught greenwashing if they were investigated thoroughly. That is a risky combination given the mounting scrutiny, tighter regulation and the threat of lawsuits.

The U.S. Federal Trade Commission is considering stricter guidelines and higher penalties for misleading green claims on products or services. The Securities and Exchange Commission has been cracking down, too. Similar pushes are happening on products and investment funds in Europe and beyond.

Key takeaways

Cross-functional panels can help tailor environmental claims to avoid common pitfalls. While green panels don't eliminate the chance of a greenwashing allegation, they can lower the risk and they are a concrete way to demonstrate that your business is working to substantiate its claims.

Tell me what you think: Send me your feedback and suggestions at rochelle.toplensky@wsj.com or reply to any newsletter. If you were forwarded this newsletter, you can sign up here.

New climate research published by Nature Sustainability considers the world under different scenarios of global warming in 2100 and predicts where people will and won't be able to comfortably live.

Current policies lead to about 2.7 degrees Celsius in warming by 2100, leaving 22% of the world's population outside the so-called human climate niche, where the mean annual temperature is 29 degrees Celsius or hotter. 

India, Nigeria, Indonesia, Philippines, Pakistan, Sudan and Niger would be hit hardest, with research linking the heat to impaired learning, adverse pregnancy outcomes and decreased labor productivity, crop yield potential, and cognitive performance. Links are also observed to increased mortality, conflict, hate speech, migration and infectious disease spread.

If we can keep global warming to 1.5 degrees instead, only 5% of people are in regions with those extreme heat levels.  

Luxury group Kering and biopharma company GSK are among more than a dozen companies preparing targets to develop a gold standard for how businesses can protect nature.

As nature and biodiversity climb up the agenda, nonprofit Science Based Targets Network will in the coming months review submissions from companies on how they use water and land, with a view to establishing a set of targets that will attest to the quality of companies’ nature plans.

Investments in solar power are on course to overtake spending on oil production for the first time, the foremost example of a widening gap between renewable-energy funding and stagnating fossil-fuel industries, according to the head of the International Energy Agency.

A total of $2.8 trillion will be invested in global energy supplies this year, of which $1.7 trillion, or over 60%, will go toward clean energy projects. The figure marks a sharp increase from previous years and highlights the growing divergence between clean energy spending and traditional fossil fuel industries such as oil, gas and coal. 

• Hyundai's transformation from industry also-ran to EV power player.
• JPMorgan's $200 million bet on carbon removals
• Exxon joins the hunt for lithium while China embarks on a risky strategy to secure one-third of the world’s supply.
• Report says recycling plastic makes it more toxic.
• How the U.S. culture wars hit Bud Light, Target and a host of other companies through shareholder proposals on abortion, guns and climate change. 
• Same-sex couples accounted for 1% of U.S. households in 2020 according to the latest census.
• My secret lawn: Confessions of a drought-conscious gardener.

• Yield-curve pioneer Campbell Harvey said an economic contraction could begin this month and last two to three quarters. “The question is how deep the recession will be,” he said.
• While AI offers benefits, some early efforts haven't worked out as expected. The tech was supposed to transform insurance; it hasn’t. And, cybersecurity chiefs say the promises and risks of early generative AI are overblown.
• Companies are facing more shareholder proposals from both sides of the political spectrum, dragging the firms into increasingly fractious conversations on environmental, social and governance issues.

• Lawmakers write a letter calling for the replacement of the oil executive leading the UN's COP28 climate summit (Washington Post)
• California might have a way to speed up permitting for clean energy connections (Utility Dive)
• Lenny Kravitz, Billie Eilish and others plan a free concert in Power our planet conference in Paris to boost climate finance (AP)

WSJ Pro Sustainable Business covers environmental, social and governance issues. Send comments to Bureau Chief Rochelle Toplensky at rochelle.toplensky@wsj.com and follow her on Twitter @RToplensky.