A host of tech companies have today (14 April) signaled their support for the Climate Transformation Fund, set up in 2021 by Milkywire with support from Boston Consulting Group (BCG) and the carbon management platform Sweep.
The Fund is designed to help firms look beyond carbon offsetting by financing a host of projects across the globe that will deliver decarbonisation. New members supporting the fund included Nordic tech firms Spotify, Klarna, Avanza, Northzone, and Mentimeter.
The companies are expected to contribute more than $5m in 2023 to projects supported by the Fund.
The Climate Transformation Fund has, to date, financed 17 solutions across durable carbon removal, nature restoration & protection, and decarbonisation, including direct air capture and the Human Rights Watch’s efforts to phase out coal.
Milkywire claims the fund’s overall aim is to maximise long-term carbon reduction or removal per dollar spent by companies and gives corporates a way to deliver impactful results beyond the common carbon offsetting routes.
Milkywire’s chief executive Nina Siemiatkowski said: “As the urgency for climate action grows, we have seen many companies invest in climate offsetting schemes that do not provide a meaningful impact on our planet. The Climate Transformation Fund was created to offer a pioneering solution for companies seeking to maximise their impact towards decarbonization. Internal carbon fees are a powerful way for companies to take responsibility for their emissions.
“By focusing on the climate impact of contributions rather than on making claims of carbon neutrality, we can support the solutions most needed to reach global net zero. These include methods ranging from nascent technologies for carbon removal to effective advocacy projects pushing for emission reductions.”
Carbon fees
Most of the companies donating to the fund do so through internal carbon fees that generate funds for supported projects.
Milkywire’s recently-published white paper, advises companies to set internal carbon fees by implementing a fee that covers the full cost of their emissions. Of the new batch of corporate supporters, Klarna has set a $100 fee for Scope 1, 2, and travel emissions plus $10 for the rest of Scope 3, delivering more than $2.35m as a result. Mentimeter, a smaller company, has implemented a $100 fee on emissions across all scopes, resulting in a $90,800 donation.
Klarna’s head of sustainability Salah Said said: “It has never been more urgent for companies to take action to mitigate against climate impact. Milkywire’s Climate Transformation Fund has proven to pave the way for real change in decarbonising our planet, and we are proud to be a significant contributor to the projects involved.
“At Klarna, we are constantly seeking new and innovative ways to protect our planet and encourage other major companies to follow suit.”