Communicating business climate action

Our latest paper helps businesses navigate the plethora of initiatives giving guidance on how companies using the voluntary carbon market can make climate claims with clarity and confidence.

We know this is a critical decade for the climate. In the next seven years, we must halve global emissions to keep global warming within 1.5 degrees Celsius and lower the risk of runaway climate change. We also know that government commitments alone will not get us there; companies have a critical role to play — supporting proven solutions that are already reducing and removing emissions. 

For the past 25 years, the voluntary carbon market has enabled the corporate sector to participate in and fund projects which reduce, avoid, and remove carbon emissions. This funding has been provided on a voluntary basis – over and above any compliance requirements. The number of corporates that have made voluntary climate change commitments has grown from 23% in 2019 to 42% in 2022 based on research into the climate commitments of the Fortune Global 500. 

The voluntary carbon market plays a critical role in the transformation to a global low carbon economy, bringing vital additional finance to reducing global emissions, while also channelling climate finance to communities often most impacted by, yet least responsible for, climate change. Recently there has been increased scrutiny of voluntary corporate action and the claims companies make to demonstrate their achievements or commitments. The fear of making the wrong claim and facing increasingly public accusations of greenwashing has meant that many companies are now reluctant to talk about their climate achievements, or to make climate claims, a phenomenon referred to as ‘greenhushing.’ 

There are currently a range of initiatives on-going to evolve and clarify how companies demonstrate their climate action through robust, transparent claims. These initiatives play a critical role in ensuring the voluntary carbon market delivers its full potential in meeting our global climate goals. However, in the interim, there is a complex landscape of options, each developing slightly different guidance and rules. Consequently, sustainability teams and those leading on climate strategies within companies are left with a patchwork of frameworks, opinions, and discussions to navigate. 

Companies choose to integrate the use of carbon credits into their climate management strategies for many reasons, including being able to demonstrate to stakeholders that they are taking immediate and robust climate action. 

They want to communicate this in a simple, credible, and meaningful way, making accurate claims for the action taken or commitment made, for example, carbon neutral or net zero. Claims provide the private sector with one incentive to go beyond their compliance requirements. Accurate claims need clear, comprehensible definitions and frameworks, but confusion remains around the definition of many widely used claims:

Generally used to demonstrate that every tonne of CO2e, and other global warming gas emissions measured (of an entity, a product, or an activity) has been reduced by internal reductions, with the remainder offset by an equivalent number of carbon credits. Carbon neutrality is a type of compensation claim and is covered by a number of initiatives including The CarbonNeutral Protocol, the EU proposals, the French legislation, and ISO 14068.

Generally used to demonstrate that every tonne of CO2e, and other global warming gas emissions measured (of an entity, a product, or an activity) has been reduced by internal reductions, with the remainder offset by an equivalent number of carbon credits. Carbon neutrality is a type of compensation claim and is covered by a number of initiatives including The CarbonNeutral Protocol, the EU proposals, the French legislation, and ISO 14068.

Generally used to demonstrate that every tonne of CO2e, and other global warming gas emissions measured (of an entity, a product, or an activity) has been reduced by internal reductions, with the remainder offset by an equivalent number of carbon credits. Carbon neutrality is a type of compensation claim and is covered by a number of initiatives including The CarbonNeutral Protocol, the EU proposals, the French legislation, and ISO 14068.

Generally used to demonstrate that every tonne of CO2e, and other global warming gas emissions measured (of an entity, a product, or an activity) has been reduced by internal reductions, with the remainder offset by an equivalent number of carbon credits. Carbon neutrality is a type of compensation claim and is covered by a number of initiatives including The CarbonNeutral Protocol, the EU proposals, the French legislation, and ISO 14068.

Generally used to demonstrate that every tonne of CO2e, and other global warming gas emissions measured (of an entity, a product, or an activity) has been reduced by internal reductions, with the remainder offset by an equivalent number of carbon credits. Carbon neutrality is a type of compensation claim and is covered by a number of initiatives including The CarbonNeutral Protocol, the EU proposals, the French legislation, and ISO 14068.

Generally used to demonstrate that every tonne of CO2e, and other global warming gas emissions measured (of an entity, a product, or an activity) has been reduced by internal reductions, with the remainder offset by an equivalent number of carbon credits. Carbon neutrality is a type of compensation claim and is covered by a number of initiatives including The CarbonNeutral Protocol, the EU proposals, the French legislation, and ISO 14068.

Generally used to demonstrate that every tonne of CO2e, and other global warming gas emissions measured (of an entity, a product, or an activity) has been reduced by internal reductions, with the remainder offset by an equivalent number of carbon credits. Carbon neutrality is a type of compensation claim and is covered by a number of initiatives including The CarbonNeutral Protocol, the EU proposals, the French legislation, and ISO 14068.

Generally used to demonstrate that every tonne of CO2e, and other global warming gas emissions measured (of an entity, a product, or an activity) has been reduced by internal reductions, with the remainder offset by an equivalent number of carbon credits. Carbon neutrality is a type of compensation claim and is covered by a number of initiatives including The CarbonNeutral Protocol, the EU proposals, the French legislation, and ISO 14068.