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Carbon offsetting: Businesses including Google and Unilever sign up to trial new code designed to stop greenwashing

The Provisional Claims Code of Practice has been developed by the Voluntary Carbon Markets Integrity Initiative (VCMI) – a multi-stakeholder initiative which launched last July with the aim of ensuring that voluntary carbon markets actually deliver the levels of mitigation and sequestration needed.

With ever more nations, cities, regions and businesses setting net-zero climate goals, the demand for carbon offsetting is expanding rapidly. But concerns persist around whether offsetting schemes are credible – and, therefore, whether the organisations using them are working to credible climate strategies. Common issues include double-counting; questions around whether schemes provide additional benefits; and questions around whether projects are climate-resilient.

The VCMI’s new Provisional Code will provide businesses with a methodology by which climate claims relating to offsetting can be categorised as Gold, Silver or Bronze. Category claims can be applied to claims made by whole companies, individual brands or individual products.

The Code accounts for all of the VCMI’s ten principles for corporate climate action:

  • Science-based action (ensuring compatibility with a 1.5C world)
  • Comprehensive action (covering all relevant emissions scopes to the appropriate extent)
  • Equity-oriented action (maximising social benefits, avoiding unintended negative consequences)
  • Nature-positive action (addressing the nature crisis as well as the climate crisis)
  • Rapid action
  • Scaled-up action
  • Transparent Action
  • Action that enables the delivery of Nationally Determined Contributions (NDCs) to the Paris Agreement
  • Consistent action
  • Collective and predictable action

In an event co-hosted by the VCMI and the UK Government today, a cohort of businesses confirmed that they will test the Provisional Code for the remainder of the year. Google, Unilever and Hitachi had already confirmed their participation in ‘road-testing’ the Provisional Code prior to the event.

After the first round of real-world business trials of the Provisional Code, which will run through to August, an updated version of the Code will be released late this year or early next. Feedback from the pilot companies set to inform the update as well as feedback from a public consultation will be used to update the code. Businesses, Governments, Indigenous People’s groups, academics, community groups and individuals are being encouraged to respond to the consultation.

Following the voluntary adoption of the Code, the VCMI is planning to work with Governments to “establish a clear pathway to regulation” in the longer term.

VCMI co-chair Rachel Kyte said the launch of the Provisional Code “is a jumping-off point for voluntary carbon markets that can work for all”.

“With clarity for business and by business on what is being claimed, we may harness the potential of the markets to help us meet our shared net-zero ambitions,” she said. “The Provisional Code enshrines an ethic of continual improvement, which the most recent climate science shows is something we need to internalise urgently.”

To Kyte’s last point, the Intergovernmental Panel on Climate Change (IPCC) – the world’s major global scientific body on climate – published the third and final key report in its most recent reporting series in April. That report emphasised how emissions cuts in coming years will need to be steeper than previously expected to give humanity the best chance of capping the global temperature increase to 1.5C, in line with the Paris Agreement and avoiding the worst physical climate impacts through to 2050.

Previous reports in the series – published in February 2022 and August 2021 respectively –  provided starker warnings than ever before on climate-related risks to the economy, nature and human health.

© Faversham House Ltd 2022 edie news articles may be copied or forwarded for individual use only. No other reproduction or distribution is permitted without prior written consent.

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