• A global survey finds 41% of Chief Sustainability Officers (CSOs) do not use carbon offsets due to trust issues
  • An additional 43% seek assurance from rating agencies for validation
  • Lack of uniformity in carbon credit certification methods raises doubts on accuracy and comparability of sustainability measurement

 

There’s no question organisations around the world are embracing sustainability and carbon management but according to a global survey of more than 500 senior sustainability officers, a lack of trust in the use of carbon credits is stalling uptake and pushing corporate net-zero plans offtrack.

The ‘Carbon Offsetting in 2023’ study by AiDash – a leading provider of vegetation management and AI-powered operations – shows sustainability and carbon management are now mainstream concerns, with 97% of businesses including them in investment decisions, 79% of CSOs already accountable to their boards, and 98% doing more than legally required to reduce emissions.

However, the survey revealed over half of businesses (56%) do not have operational control over most of their greenhouse gas (GHG) emissions and nearly half (43%) use carbon offsets for hard-to-reduce GHG emissions alongside direct measures.

As a result, many businesses fail to meet net-zero targets without the use of carbon credits.

Despite this critical need, the survey revealed a major lack of trust in carbon offsetting, with around 41% of chief sustainability officers (CSOs) stating they do not use carbon credits as they do not “adequately trust them” at a time when many carbon offsetting projects are being shown to be inconsistently measured, inadequately monitored, and frequently failing to prove they are based on additional carbon captured.

Another revelation is the inconsistency in validation methods for carbon credits.

Roughly 4% of CSOs do not validate credits at all, 35% only buy from government or voluntary certified schemes, 43% are exploring working with credit rating agencies, 35% undertake their own validation or third-party due diligence and 41% use a combination of these methods.

This lack of uniformity raises doubts surrounding the accuracy and comparability of corporate sustainability measurements.

 

Australia’s fair share of carbon credit issues

Abhishek Vinod Singh, CEO at AiDash, says rather than waiting for governments to agree to regional or global frameworks, businesses are forging forward independently, making ambitious environmental commitments.

“The intent and action is there but what these businesses desperately need is an organisational tool they can trust to accurately measure, monitor, track and validate the progress of their sustainability plans on their journey to net-zero.”

Concerns into the validity of carbon credits have also been raised here in Australia after an independent review – dubbed the ‘Chubb Review’ – found “more than a dozen” tweaks were required to strengthen the integrity of the Australian Carbon Credit Unit (ACCUs) scheme

These changes include putting an end to the much-criticised “avoided deforestation” methodology which had allowed landholders to claim credits by promising not to cut down trees that they might not have intended to cut down in the first place.

It also called for landfill gas project credits to become stricter over time and for tougher oversight of the regeneration of forests by humans to ensure it achieves the permanent storage of carbon.

NOW READ: Ex-science chief Chubb calls carbon credits scheme ‘essentially sound’ … but is it really?

 

Chubb Review misses the elephant in the room

Environmental leaders such as The Climate Council said the review did not address the elephant in the room – allowing emitters to continue polluting as usual, rather than making real progress in avoiding and reducing emissions by purchasing ACCUs.

Carbon offsets are supposed to be used as a last resort, and only for the small share of emissions that cannot be avoided through process, technology and other operational changes, the organisation highlighted.

Paying for ACCUs has become the first and only thing many businesses are doing about their harmful emissions but as Climate Council head of advocacy Dr Jenniffer Rayner points out, these cheap and easy offsets do little to tackle the climate crisis.

“The only lasting solution is genuine and deep cuts in emissions,” she says.

“The Chubb Review has provided some positive recommendations for improving the integrity and transparency of carbon credits.

“But the most important question is: where and how will carbon credits be used?”