{"id":25333,"date":"2023-10-03T09:56:21","date_gmt":"2023-10-03T08:56:21","guid":{"rendered":"https:\/\/www.argonandco.com\/?post_type=article&p=25333"},"modified":"2023-10-03T09:56:21","modified_gmt":"2023-10-03T08:56:21","slug":"carbon-credits-a-robust-tool-or-a-distraction","status":"publish","type":"article","link":"https:\/\/www.argonandco.com\/en\/news-insights\/articles\/carbon-credits-a-robust-tool-or-a-distraction\/","title":{"rendered":"Carbon credits \u2013 a robust tool or a distraction?"},"content":{"rendered":"

In late June, Nestl\u00e9 became the latest company to announce a move away from the use of carbon offsets to instead focus on emissions reductions in its value chain. This move follows similar announcements from companies including EasyJet and Leon, who have both withdrawn \u2018carbon neutral\u2019 products from their consumer offerings amidst an acceleration of such claims being disputed in the courts. Indeed, Nestl\u00e9 itself is currently facing a legal challenge from a French consumer group over claims that its Nespresso brand is carbon neutral.<\/span><\/p>\n

Carbon offsets, despite their shortcomings, can be a critical tool to balance companies\u2019 greenhouse gas emissions that are emitted after all reasonable efforts have been made to reduce them, also known as residual emissions. However, most companies are not at a stage in their net-zero journey where carbon credits can offset residual emissions as significant reductions are still needed. Despite this, many have relied on offsetting schemes in their climate pledges in a bid to claim carbon neutrality. These claims are resulting in mounting reputational, regulatory and litigation scrutiny across the UK, US, and Europe.<\/p>\n

Using carbon credits to claim the offset of emissions other than residuals carries inherent risks. Nevertheless, there are still opportunities for companies to engage with carbon credit projects and make positive climate contributions, making the question of whether or not to engage in a carbon credit strategy a difficult one.<\/p>\n

The case against offsetting to claim carbon neutrality<\/h2>\n

The tide is turning against the use of offsets to claim carbon neutrality: adverts claiming neutrality through offsetting are likely being banned by watchdogs in both the\u00a0UK\u00a0and the\u00a0EU. Regulators are also introducing legislation to protect consumers and promote competition, and even individual consumers are taking companies to court.<\/p>\n

Criticism is normally based on the following:<\/p>\n