It is more than 15 years since global climate consultancy Carbon Trust launched a new standard to end ‘greenwash’.
Hailed by current chief executive Tom Delay as a move designed to end public mistrust of corporate climate change claims, little has changed.
“What businesses and consumers both share is a desire for one, credible way to prove an organisation has ... reduced their carbon emissions year-on-year without the use of offsetting,” he said at the time.
“The Carbon Trust Standard is the only answer to this.”
Sadly, those greenwashing claims continue, with even the Carbon Trust admitting that consumers may have been misled by its own “carbon neutral” labelling due to it being partly based on offsets, that could be poor quality.
In September 2023, the Carbon Trust decided to cease its carbon neutral verification seen on product packaging around the world. Designed to guide consumers on the emissions created by the products they were buying, more than 27,000 items carry the label.
Now, those labels will disregard carbon offsets (or carbon credits) and instead focus on what companies are doing to reduce their emissions.
“Carbon neutral has played an important role in launching businesses’ journeys towards net zero, and our carbon neutral label requires a rigorous annual assessment, against PAS 2060, an internationally recognised standard for carbon neutrality,” said a statement from the Carbon Trust.
“We will transition our carbon neutral verification to a range of new and existing verifications that focus on a product’s emissions reduction. For businesses this offers a way of demonstrating to consumers a commitment to achieving reductions. For consumers, it helps them choose products offered by brands committed to taking action to reduce their impact.”
After being at the helm since the Carbon Trust was founded in 2001, Delay is being replaced by Chris Stark, the former head of the UK’s Climate Change Committee.
Stark, who is recognised for his significant contributions in climate policy, having advised UK governments for over a decade, will assume the role in Spring 2024.
What are the priorities for the Carbon Trust?
It looks like Stark will have his work cut out as the global climate consultancy undergoes its own transition at the most crucial time in its history, taking over the role in Spring as he leads the organisation tasked with driving accelerated climate action.
The time for delay is clearly over.
During this transitional phase for the consultancy, there are a number of priorities that new CEO Stark will need to address. Based on current climate concerns and conversations, Sustainability Magazine highlights four areas that need attention.
1. Restoring Consumer Confidence in Carbon Neutral
It’s not just the term ‘carbon neutral’ that needs to be ‘sold’ to consumers. It is easy to see where confusion and uncertainty springs from around sustainability, and why the Carbon Trust themselves admittedly their own definition of carbon neutral could have been unintentionally misleading. Put another way, it could have been greenwashing.
While the Carbon Trust has recognised this issue, and instead changed the way it judges and verifies companies, carbon neutral has played an important role in kickstarting journeys towards net zero, and is a phrase familiar in the wider public consciousness, even if definitions are less well understood.
The Carbon Trust will transition carbon neutral verification to focus on a product’s emissions reduction, which is a more active solution, but carbon neutral still has an important role to play.
2. Financing the Energy Transition
In October 2023, the Carbon Trust and Climate Action hosted a roundtable discussion at Climate Week New York on Financing the Energy Transition, and this will continue to be a hot topic through 2024.
Some of the key takeaways from that discussion, which took place ahead of COP28 for context, included the fact that there is enough capital available for the energy transition, and the technologies are available to enable the change required. Cash is not a problem, making sure it is spent wisely is another matter.
It was also noted that companies struggle to see their place in the transition and are blinded by the pressure to hit targets and milestones.
3. Scope 3 Emissions in Supply Chains
The Carbon Trust has played a pioneering role, launching its Supply Chain Standard in 2015. This was the world’s first independent certification for measuring, managing and reducing GHG emissions in organisations’ supply chains.
Scope 3 emissions make up the majority for many organisations. Apple, for example, says 65% of its emissions are Scope 3, and it has been working hard to reduce that figure with increased use of renewable electricity. A multi-billion-dollar green bond saw Apple stump up some of its own vast cash reserves to help suppliers transition to clean energy.
Apple is not alone, with many businesses having 70% of their carbon emissions coming from upstream and downstream sources like raw materials from suppliers or the use of the sold products. These Scope 3 emissions are harder to control as they do not fall under direct control.
With environmental regulations starting to bite, addressing Scope 3 is essential for any business, and is sure to be a challenge for the Carbon Trust.
4. Voluntary Carbon Markets
Oil giant Shell is one of the latest, and biggest, organisations to shy away from carbon offsetting and credits, over concerns that many of these offsets have no environmental benefit.
The unregulated voluntary carbon market grew to more than US$2 billion in 2021 but has dropped to just a quarter of that since, according to Barclays.
Despite that, these carbon markets are gaining support, with US climate envoy John Kerry telling the Africa Climate Summit that the global south would benefit from a growing carbon market.
“This market has to become a market in the billions in order to work effectively,” said Kerry. “For that, we need to ensure the environmental integrity of this market. This is critical, not only to protect the climate, but also to create a thriving market because people won’t take the risk either of getting involved in a market that doesn’t have the right standards and guidelines.”
There has been progress. The Integrity Council for Voluntary Carbon Markets published guidelines for carbon credit-producing projects to concerns on quality and transparency.
While COP28 sadly did not produce rules for a UN-backed carbon market, voluntary carbon markets are still important for companies looking to decarbonise, while also providing essential funding for projects in emerging markets.
This is where the Carbon Trust needs to play a leading role – helping organisations to navigate the market and provide expert advice purchasing quality offsets as part of an overall emissions reduction strategy which includes direct and indirect emissions.
What is the Carbon Trust and what does it do?
The Carbon Trust partners with businesses, governments and financial institutions to accelerate their journeys to Net Zero.
The Carbon Trust was founded in the UK but is now truly global, with more than 400 environmental sustainability experts in London, Amsterdam, Beijing, Singapore, Johannesburg, and Mexico City.
Sustainability is a BizClik brand.