World's biggest companies buy “probably worthless” carbon offsets: analysis May 31, 2024

A new analysis by Corporate Accountability found that well-known names such as Disney, Volkswagen, Air France, and many others were among the brands that invested heavily in probably worthless carbon offset credits (Ronny Hartmann)

By AFP - Agence France Presse

World's biggest companies buy “probably worthless” carbon offsets: analysis

Globally renowned companies - from oil and gas majors to the banking and technology sectors - are contributing to greenwashing by purchasing large amounts of “probably worthless” carbon offsets, a watchdog warned on Thursday.

A new analysis by Corporate Accountability found that well-known names such as Disney, Volkswagen, Air France, and many others were among the companies investing heavily in probably worthless credits from environmental projects intended to count towards their emissions reductions.

“These trends are extremely worrying,” Rachel Rose Jackson, director of climate research and policy at the non-profit organization, told AFP.

She added that the massive uptake of carbon credits appears to be designed “to enable the continuation of greenwashing” or deceptive practices designed to create a false impression of environmentally friendly policies.

On paper, voluntary carbon markets (VCMs) allow companies to write off a portion of their emissions by buying credits in emission reduction activities, for example, reforestation projects or the replacement of polluting stoves in the developing world.

The sector is currently worth around US$2 billion a year, but a growing body of research has raised concerns that the emission reduction claims made by the schemes are often greatly exaggerated or unfounded.

The new findings build on a first analysis carried out by Corporate Accountability in collaboration with the Guardian newspaper last fall, which exposed 39 of the top 50 emissions offset projects as “probably garbage”.

When re-evaluating the top 50 projects in AlliedOffsets' database for the current study, which analyzed data up to December 31, 2023, they found an increase of 42 projects classified as “probably junk”, despite emerging industry standards aimed at reform.

Seven projects were considered “potentially junk” and one did not have enough information for classification.

Surprisingly, the buyers of these questionable credits spanned several sectors, not just the fossil fuel industry.

Thirty major corporations, including Shell, Nestlé, and Boeing, bought large volumes of “notoriously junk” credits, where “you'd have to have your head in the sand not to know that these projects were under extreme scrutiny,” said Jackson.

Earlier this week, President Joe Biden's administration gave its backing to VCMs by publishing a set of unenforceable guidelines that it said would signal best practices to ensure that the schemes worked to reduce greenhouse gas emissions.

Prominent advocates of carbon markets, including former US climate envoy John Kerry, argue that government funding alone is insufficient to meet the Paris Agreement's goal of limiting warming to 1.5 degrees Celsius.

But Jackson remained skeptical. “While it's all very well launching another set of principles, they haven't proved actionable,” she said.

ia/mlm