February CSR Lunch Summary: How Carbon Offsetting enhances companies’ CSR policies

Natalia Gorina, Senior Key Account Manager at South Pole Group, delivered a very interesting presentation for our CSR Lunch on February 26th on how carbon offsetting enhances companies’ CSR policies.
Firstly a clear explanation has been given on how voluntary carbon offsetting works. Most important is to have a net GHG global reduction, the project must be additional (it would not have happened without the sale of carbon credits). How a carbon credit is created has been explained in detail, as well as all the different standards that exist for carbon credits (like VCS, The Gold Standard, Clean Development Mechanism, CCB Standards, Social Carbon). Most popular standards in terms of transactions come from VCS and Golden Standard. Typical projects that qualify for carbon credits are in the area of renewable energy, forestry and household (or community based projects). The most popular project technologies are from VCS credits (wind, hydro, bio mass, forestry), and from the Golden Standard credits (wind, cook stoves, water purification, biogas, biomass).

Of course there are the typical critical responses on carbon offsetting:

1) Carbon offsets are the easy way out
> For which the following response was provided: reduce first, offset the rest.

2) Claimed emission reductions and benefits are not real
> Which can be prevented by using standards & registries to ensure transparency.

3) Carbon credits amounts are insignificant, as only companies with low footprints are offsetting.
> Voluntary offsetting volumes are not insignificant but voluntary action alone is not enough. There exists still a huge gap between carbon emissions and what is voluntary offset.

Why do companies engage in offsetting?
For reputation/brand image, employee engagement, market differentiation, philanthropy, efficiency, & supply chain management. To enhance brand image, reputation & differentiate from competitors: offsetting projects should be chosen with parallels & links with your location, products, activities, supply chain & CSR policy.

An interesting discussion popped up on whether carbon credits are given additional. It is a heated subject that is being overcome at verification and validation stage, where projects can be rejected if they are not additional. Furthermore double selling is not possible as every carbon credit has its own serial number.

Another discussion topic was the incentive for companies to offset. At the moment is still is mostly a green motivation and above mentioned reasons, but there are more and more studies providing the business case.

Closing, there were many great examples how carbon offsetting could enhance company’s CSR given around various strategic intents: i) a geographic link where DHL company locations where linked to emission reduction projects, ii) company’s logo enhanced by a project, iii) Project tangible goods linked to company’s product, iv) Carbon neutral product linked to a project technology, v) Link between project and raw materials, vi) From offsetting to “insetting”: carbon neutral and deforestation free supply chains, vii) Projects’ benefits fully integrated into CSR strategy, viii) Offsetting made tangible for employees and clients.

By Sophie Wisbrun-Overakker, 2014-15 CAS-DAS CSR participant

Download the summary here