Controversy surrounding voluntary carbon offsets is not news anymore. It hasn’t faded away – just the opposite; it is so commonplace, there is little value to covering it. Bloomberg summed it up last week in their ESG Investing newsletter:
“Already tainted by widespread allegations of greenwashing, the arguments that carbon credits just aren’t a viable strategy for fighting global warming continue to pile up. The world’s top arbiter of corporate climate goals, the Science Based Targets initiative, described the instruments as mostly ‘ineffective’ in a new review – a report likely to reverberate all the more given the group’s recent brush with controversy. Meanwhile, a key industry oversight group announced credits representing one-third of the carbon offset market won’t merit its quality label.”
They were nice enough not to pile on by mentioning the UN’s position reported by Financial Times that “groups should not use carbon credits to offset emissions outside of state-regulated schemes.”
At this point, there is almost no need to talk about new offset project controversies. I would argue they are essentially expected now. But offsets remain an attractive climate management option especially considering their cost. What to do?
Sustainability leaders, staff and advisors: Offsets were intended from the beginning to be one tool in the suite of climate management options. However, there are real risks to their use and those are becoming more public than ever. Executives are seeking direction on how to balance costs, commitments and climate. If used appropriately, offsets can still be a reasonable, viable and low cost solution. But to manage risks, you need to conduct – and possibly update – your own due diligence. Look at the past 12 months of carbon offset headlines and failures to inform or revise your due diligence approach. If you don’t keep up with the times (and controversies), your company could be in the headlines soon.
Our members can learn more about climate management and offsets here.
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