Companies should drop offsetting-based environmental claims and adopt a “climate contribution” model instead, according to a new quality standard.
In a new code of practice, the Voluntary Carbon Markets Integrity Initiative (VCMI) has published guidance on how companies should use carbon credits as part of high-quality corporate action. It recommends that firms should disclose their emissions every year, show they are successfully meeting a science-based target aligned with the Paris agreement, and only use carbon credits to contribute to climate mitigation, moving away from claims that they have “cancelled out” their emissions by purchasing offsets.
The rules, which are limited to voluntary corporate action on the climate, were the result of consultation with civil society, the private sector, Indigenous communities and governments. They aim to introduce a standardised method for assessing the quality of corporate claims amid accusations of greenwashing and intense scrutiny of the carbon offsetting industry.
The VCMI recommends firms should buy high-quality credits from a separate standards body, the Integrity Council for the Voluntary Carbon Market (ICVCM), which will release its recommendations on what counts as a “good” carbon credit later this summer.
“We frame the use of carbon credits our companies might make as contributions above and beyond what they should be doing to decarbonise themselves,” said Mark Kenber, executive director of the VCMI.
“[Claims of carbon neutrality using offsets] were understandably contentious. We’ve taken them off the table for now. We will reconsider them. A lot of companies would like to make them as they see it as a differentiator but it’s probably the area that causes most confusion. Of course, there are both lawsuits and emerging bits of regulation in the UK and EU. It would be foolish to pre-empt any of that,” he said.
The Nestlé chocolate bar KitKat, fast-food chain Leon, and Albert, the UK film and TV industry’s sustainability certification operated under Bafta, are the latest organisations to move away from claims of “carbon neutrality” based on offsets.
They have joined Gucci, easyJet and the US airline JetBlue in moving away from offsetting-based claims in adverts as regulators in the UK and EU crack down on climate claims in adverts.
In California, Delta Air Lines is facing a lawsuit over its $1bn (£780m) carbon neutrality claim that plaintiffs say is “false and misleading” as it relies on offsets that do little to mitigate global heating. Delta has said the lawsuit is without legal merit and insisted it is a vigorous advocate for more sustainable aviation.
The case in part relies on a joint Guardian investigation in January which found that more than 90% of rainforest offsets from Verra, the leading certifier, were largely worthless, often based on stopping the destruction of rainforests that were not threatened, according to independent studies. Verra strongly disputed the findings.
“A starting point for this was in the FT during Cop26 where every other page was a full-page ad by a company making spurious climate claims. We felt there’s a need for some clarity and some consistency on this,” said Kenber, who founded Verra and still sits on its board. “We’re not gonna solve the climate change through voluntary action. We all know that.”
Gilles Dufrasne, a policy officer with Carbon Market Watch, said the time for carbon neutrality claims was over.
“Companies must step up their transparency game and provide real information that consumers can understand. Beyond reducing their emissions, the richest companies have a responsibility to contribute finance to climate action, even in sectors that they are not directly impacting. If the largest and richest companies do not step up to provide the finance that we urgently need, then who will?” he said.
In a statement, Nestlé said it was moving away from investing in carbon offsets for its brands, such as KitKat and Nespresso, opting instead to reduce emissions in their supply chain. A spokesperson said its net zero roadmap did not rely on offsets.
It is understood that Leon, which previously claimed to be selling “carbon neutral” burgers using offsets, will no longer say that in adverts. The firm remains fully committed to becoming carbon neutral by 2030 for its scope 1 and 2 emissions, a company spokesperson confirmed.
Albert, which the BBC, Netflix, Sky and other major broadcasters all use for TV and film production, dropped its “carbon neutral” stamp at the end of May and introduced a new logo. The purchase of carbon credits remains an obligatory part of the certification process although this is under review, the Guardian understands.
