Climate Cooldown

Offsetting: Feeling lost in the wood?

September 2023

The Climate Cooldown newsletter is a monthly roundup that focusses on positive business and marketing-related climate news, steering away from the doom and gloom.

We've been very preoccupied with the (mal)practice of ‘offsetting’ lately. And boy, it’s a maze!

As an agency, we’re very clear that offsetting is pure greenwashing. But, as with a lot of the sustainability terminology, you have to be very determined to unpick what’s what.

Hopefully, we can shortcut it for you.

Let’s start with the basics...

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What is offsetting?

Offsetting means buying ‘credits’ to balance your emissions. For example, you fly and pay a bit extra (usually a few pounds) to remove the emissions from that flight by e.g. planting a tree, preventing deforestation, or investing in renewable energy projects.

Sounds pretty good, doesn’t it?

The problem is, it doesn’t work.

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Offsetting or overestimating?

Cambridge University and VU Amsterdam published their peer-reviewed study in Science magazine in August. It shows that over 90% of offsetting schemes grossly overestimate the impact they’re having in preventing deforestation.

So, what does this have to do with greenwashing?

Well, businesses are using these offsetting schemes as a means of promoting themselves as ‘carbon neutral’, ‘climate positive’ or other confusing terms.

This practice has been called out by the Advertising Standards Authority (ASA) as greenwashing and other regulators are voicing concerns. Some are investigating it as fraud.

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Offsetting = climate confusion

In fact, the Commodity Futures Trading Commission in the US, has set-up an environmental whistleblowing taskforce to investigate green claims based on these carbon credits.

Why? Because, offsetting is a distraction. It’s confusing for consumers. And, despite the billions of pounds that have been paid into these schemes, global emissions are still increasing and deforestation is getting worse.

That means that they’re still spending our collective ‘carbon budget’ at an increasing rate. We can’t offset our way out of that.

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What does this mean for business?

It’s simple. Focus on measuring and reducing emissions and be transparent about the journey that you’re on.

Invest in tree planting, forest protection and renewable energy initiatives and talk about what you’re doing in those terms; as third party investments.

Not as a means of reducing emissions. That usually changes how businesses evaluate the return on investment they are getting - and the level of scrutiny applied.

What we've been reading & listening to this month:

Short read: With reference to greenwashing, the Science Based Targets initiative (SBTi) has removed Amazon from its list of companies ‘taking action on climate goals’.
Great listen: Offsetting? A contribution mindset vs. a compensation mindset. How to use community project investments as a way of creating content that drives action with Gavin Sheppard and Robert Cheesewright.
Watch: Silo - a new(ish) gripping dystopian series on Apple TV (slightly off-piste, but we couldn’t resist recommending it as it’s gripping.)