It seems that no matter where I turn, I’m assaulted by headlines bashing carbon credits and corporate attempts to meet sustainability goals. While it’s valuable to debate the best use of carbon credits, these headlines are a distraction at best, and at worst, a wilful misrepresentation.
“Carbon credit market confidence ebbs as big names retreat.”
Yes, corporates around the world are shifting their interactions with carbon markets and credits, but it’s not because they’re moving away from sustainability efforts as a whole. If anything, it’s because they’re leaning in harder and sharpening their strategies.
Through a partnership called “Revere”, Palladium and National Parks Partnerships, acting on behalf of the UK’s 15 National Parks, have been talking to scores of companies about sustainability, nature-based solutions, and their net zero commitments. What we hear them telling us and see them doing is quite different from the headlines.
So, rather than dwell on the negativity, I’d like to share my take on corporate carbon credit commitments, which is grounded in first-hand experience of the ever-changing world of corporate sustainability. It goes something like this:
Companies made big net zero commitments three years ago before working out how to deliver on them.
Many companies used the pandemic as an opportunity to move forward with their net zero commitments and wanted to show bold action. There was an element of ‘bandwagon jumping,’ and now many organisations are regretting moving so quickly. The public has also learned what good looks like, and corporations are facing more scrutiny than they expected.
So, while headlines suggest that companies are ‘backing out’ of their commitments, I think it’s fairer to say that they’re refining plans to ensure they actually deliver. If that means a change of tactic, so be it. That’s better than sticking to flawed schemes.
Big companies bought any cheap carbon credit as a way to take some sort of action.
At the same time that these companies were setting big commitments, there were a lot of opportunities for high volume, low price carbon credits from around the world. They were easy to purchase and in a rush to take action (and the absence of global regulation or standards), a lot of companies bought them without knowing whether they would actually avoid or remove carbon as promised.
Through Revere, we’ve found that companies are now asking us a lot of questions about the integrity of our projects and looking for reassurance before they invest. They’re also willing to pay a higher price in order to get that high quality, rich co-benefits, and deeper impact. It’s clear that companies are much more educated and have progressed leaps and bounds from just a few years ago.
Companies have spent three years working out how to actually deliver decarbonisation.
Let’s be honest: decarbonising an entire corporation is not easy, even for the most seasoned sustainability professionals. We’re seeing sustainability teams working really hard on the practical and technical aspects of delivering a credible net zero action plan and on top of it, in the last 18 months, many are adding biodiversity action plans as well. Hence the gap between the big announcements of 2020 and the shifting of approaches in 2023.
Companies are prioritising reducing their own emissions and taking a more nuanced approach to use of carbon offsets.
This might be the most positive shift we’re seeing at Revere. From the outset, we’ve preached the importance of reducing emissions before purchasing credits to offset emissions that can’t be avoided. This is in line with the guidance provided by the Science Based Targets initiative (SBTi), the GHG Protocol, and our own experts.
For instance, some airlines are now saying no to offsets and instead direct their resources toward finding alternative fuels – a longer-term solution to decarbonisation.
This shift to prioritise reduction above all else is a really good thing and shouldn’t be disguised as a negative.
Companies are ditching high volume, low integrity carbon offset programs and seeking high quality, long term schemes.
Companies are keen to avoid buying ‘junk credits’ and instead are realising they can and should spend the time to co-design and procure projects that truly meet their needs. It won’t always be the cheapest option, but it will be the best quality and lower risk. That’s certainly where Revere is focusing its efforts – working closely with partners on nature restoration projects that deliver high integrity carbon credits that genuinely work for nature, landowners, and communities.
When it comes to companies and net-zero, I am hopeful, based on the actions I see happening around me. My only caveat is it will take longer than everyone will like. Corporate timetables can be slow, and sustainability professionals often struggle to secure the budgets they need to deliver real impact. But the will is there, alongside deepening knowledge, skills, and nature-positivity within corporations.
I suppose the headline ‘Companies take time to develop rigorous net zero strategies’ doesn’t garner as many clicks as one declaring the death of carbon credits, but in my view, it would at least be accurate.
Learn more about Revere, the National Parks Partnership, Palladium’s offsetting program in Zambia, or contact email@example.com for more information. If you're a forward-looking business looking to secure high integrity UK-generated carbon credits, please register your interest with Revere before 15 December 2023.