In March 2023 the European Commission proposed to update Union consumer law to ensure that consumers are protected and to empower them to contribute actively to the green transition. In particular, in the directive proposal, the Commission tackles “misleading green claims”, among which carbon neutral claims.
On the other side of the Atlantic Ocean, Delta Air Lines faces lawsuit over $1bn carbon neutrality claim. According to The Guardian, the plaintiffs say the airline’s claim is “false and misleading as it relies on offsets that do little to mitigate global heating”. And even though on a juridical level Delta Air Lines’s claim may be valid … it seems illogical to use the word “carbon neutral” to describe one of the highest emitting sector of our economy – the airline industry.
Carbon neutral : a definition
An organization or a territory is “Carbon neutral” if its greenhouse gas (GHG) emissions -direct and indirect- are balanced by its GHG removals or reduction to achieve a net-zero carbon footprint.
Is it possible for a company be carbon neutral by buying carbon credits?
Not really. A company can offset its direct and indirect emissions buying the equivalent carbon credits : it will allows other organizations to compensate for its carbon emissions by investing in projects or activities that reduce or capture an equivalent amount of greenhouse gases elsewhere.
This mechanism contributes to reaching net zero emissions at a larger scale, not at company level… let alone at product level.
Why “carbon neutral” claims are problematic
Companies offsetting their emissions often use the term “carbon neutral” to describe their organization or product. Technically, they are contributing to reaching net zero at a national or global scale, but as the removals or emission reduction occur outside of the organization perimeter, it is abusive to use the term at a product or organization scale.
The priority for an organization should always be to reduce its own emissions, direct and indirect, and offsetting can be seen as a way to outsource reduction efforts outside of the organization.
Furthermore, the real impact of offsetting projects is often overestimated : in many cases, the conditions for a project to deliver carbon credits are not met and the removals or reductions enabled by the projects are inferior to the volume of carbon credits emitted. For example, carbon credits often rely on forestry projects : the amount of CO2 captured due to the projects is calculated in the long term (15 years for example), but planted trees can be cut down after 5 years, due to a change of land owner for example. You can read our article on offsetting here.
What can you do and say, then?
What you can do
- Measure your emissions (each year if possible) following a trusted framework (ISO 14064-1, GHGP, Bilan Carbone).
- Set science-based reduction targets
- Optional : compensate your emissions through trusted offsetting projects (WWF Voluntary Gold Standard, Verra’s Verified Carbon Standard labels for example).
What you can say
Let’s say your company has conducted a full GHG inventory, is implementing a reduction plan with science-based targets and is compensating its remaining emissions with carbon credits.
What you could say is : “Our company is committed in cutting its GHG emissions in line with the Paris Agreement. To contribute to reaching net zero, we are compensating our emissions by supporting certified offset projects.”
In its directive proposal, the European Commission suggests that such claims should “specify the share of total emissions that are addressed through offsetting, whether these offsets relate to emission reductions or removals enhancement, and the methodology applied.”
Depending on the communication format, the detailed information can appear directly next to your claim, or at least needs to be easily accessible through a link.
For example :
“Our total direct and indirect emissions were of XXX.XXXTCO2e in 2018 and we strive to reduce them by YY% by 2025, to reach ZZZ.ZZZTCO2e. Last year, in 2022, total emissions reached AAA.AAATCO2e and our company contributed to carbon offsetting projects representing AAA.AAATCO2e of reduction and removals. Detailed information on our carbon footprint, our reduction path and the offsetting projects we supported can be found on linktotheESGreport.com.“
At the end, what really matters in communicating about your GHG commitment, is to do it with transparency so that consumers and all stakeholders (NGOs, Government, etc) can understand easily where you are and the path you are following. A sensational claim can sound attractive to your marketing team, but stakeholders customers who care about the environment will consider it suspiscious.
Sources
European Directive proposal on green claims
The Guardian – Delta Air Lines faces lawsuit over $1bn carbon neutrality claim
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