New standard aims to help protect companies from accusations of greenwash by ensuring they prioritise the highest-quality, most effective carbon offsets available
Academics from the University of Oxford have today launched a new standard for carbon offsetting, in a bid to ensure the growing number of net zero strategies adopted by state and corporate actors are effective in their stated goal of halting increases in the atmospheric concentrations of greenhouse gases.
As things currently stand, a patchwork of voluntary and regulatory standards govern approaches to offsetting and how net zero is defined, a lack of cohesion that critics claim has led to a glut of low-quality offsets that undermine the credibility and effectiveness of net zero strategies.
The hope is that new principles, dubbed The Oxford Offsetting Principles, will help provide greater clarity to the broader industry on what constitutes a credible offset and become a key resources for cities, governments, and companies looking to avoid accusations of 'greenwash' as they seek to design and deliver robust net zero commitments that align with climate science.
"Adopting the Oxford Offsetting Principles and publicising their adoption can create the demand for offsets necessary to reach net zero emissions," explained Professor Cameron Hepburn of the university's Smith School of Enterprise and Environment. "Creating demand for long-lived greenhouse gas removal and storage is vital, whether we like it or not, to reaching the Paris goals."
Credible net zero aligned offsetting is contingent on a number of key elements, according to the guidelines. First up, companies or state actors must prioritise emissions reduction before embarking on offsetting programmes, demonstrate the environmental integrity of any offsets that are sourced by the organisation, and disclose how all purchased offsets are then used.
Next, they should prioritise offsets that directly remove carbon from the atmosphere and offsets that remove carbon from the atmosphere permanently or almost permanently by shuttling it into long-lived storage.
Finally, all credible strategies should support the development of a 'net zero aligned' offset market.
Dr Ben Caldecott, Lombard Odier associate professor of sustainable finance and COP26 strategy advisor for finance, predicted the principles could prove a boon to the growing number of financial institutions looking to clean up their operations and portfolios.
"The Oxford Offsetting Principles can be used by financial institutions to design and deliver credible plans for achieving net zero," he said. "Financial institutions can also assess the plans of investees and borrowers. This can inform risk and impact analysis, as well as engagement and stewardship activities."
The new report also highlights the need for a "credible approach" to nature-based carbon offsets, such as forest restoration.
Professor Nathalie Seddon, director of the university's Nature-based Solutions Initiative, emphasised that nature-based offsetting should be approached carefully. "Irrespective of any carbon benefits, scaling up the protection and restoration of ecosystems is vital," she said. "While carbon offsets can help to fund some of this work, nature-based solutions should be valued and funded for the broad suite of benefits they bring, now and into the future. However, nature-based solutions are not an alternative to geological storage and rapid decarbonisation of the economy."
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