Hundreds of companies have set climate goals to reach net zero emissions—or in some cases to become “carbon negative” or “carbon positive”—but some plans are less credible than others, and it’s difficult to tell what’s actually greenwashing. A new framework is designed to give companies benchmarks on best practices, and to help make it easier for consumers and investors to understand if they’re actually making progress.
“For many years, companies have been declaring carbon neutrality, or climate neutrality, or something similar,” says Mark Kenber, executive director at the Voluntary Carbon Markets Integrity Initiative (VCMI), the group behind the new framework. “And the only thing that’s been clear about those claims is that they very rarely mean the same thing. Sometimes we’ll have two companies that claim to be carbon neutral, but have completely different bases for that claim. And then you’ll have two companies that are doing exactly the same thing and use completely different claims. So it’s not surprising that the public, and consumers in particular, are confused.”
The group, which launched last year and is funded in part by the U.K. government, created a new “code of practice” that can help evaluate corporate climate goals and the use of carbon credits. To reach VCMI Gold, the highest level, a company will have to have net zero targets—including both short- and long-term goals, covering all of its emissions, including from its supply chains—and show that it’s on track to meet those goals.
“In any year that it wants to make a claim, it needs to show that its emissions are falling in line with its target and its plan is being implemented,” Kenber says. One hundred percent of remaining emissions need to be covered by high-quality carbon credits.
At the Silver level, companies will have to be on track for their next target to reduce emissions, and cover at least 20% of remaining emissions through high-quality carbon credits. The Bronze level lets companies address Scope 3 emissions, the emissions from suppliers and customers, through a combination of reducing those emissions directly and buying carbon credits.
For the next several months, the group will be working with some companies, including Google and Unilever, to try out the tool and offer feedback about how easy it is to use. Then it will launch more broadly. Other programs, like the Science-Based Targets Initiative and the Integrity Council on Voluntary Carbon Markets, are also continuing to refine the guidance that they offer companies.
“By the end of the year . . . there should be a simple, easy-to-navigate ecosystem of target-setting claims and carbon credits and reporting that companies can use,” Kenber says. “Then companies will have clear guidance on what they need to do. And public investors, journalists, and others will be able to scrutinize them with a reasonable amount of ease. . . . At the moment, it’s quite hard to tell what greenwashing is and whether a company is or not. We hope that with all these initiatives it’ll be much easier to separate the wheat from the chaff.”