The CarbonNeutral Protocol Index

Step 3: Target: Guidance

3.1 Setting internal reduction targets

The CarbonNeutral Protocol does not mandate what level of internal reduction target should be set to achieve CarbonNeutral® status. As outlined in Appendix 4.2, organisations are encouraged to use established management tools to identify the appropriate balance between internal reductions and the use of offsets to achieve carbon neutrality cost-efficiently and in ways that deliver strategic value.

While the MAC curve approach (see Appendix 4.2) helps an organisation prioritise its reductions options, it does not necessarily align the organisation’s internal reduction efforts with the UNFCCC Paris Agreement’s call for global emissions reductions to limit average global temperature rise to well below 2oC above pre-industrial levels, in order to significantly reduce the risks and the impacts of global climate change.

Therefore, organisations should consider the option of establishing internal reduction targets that align with scientifically established emission reduction trajectories that can deliver a stable climate. For example, the Science Based Target (SBT) initiative, a collaborative initiative by CDP, World Resources Institute (WRI), the World Wide Fund for Nature (WWF) and the United Nations Global Compact (UNGC), provides guidance on science-based target setting to encourage and support companies in the transition to a low-carbon economy.

3.2 Climate (or carbon, or net) positive

A growing number of corporates are exploring terms and concepts that address the perceived limitations of neutrality, which can imply no net gain for the climate. The most common terms in this space include ‘carbon positive’, ‘carbon negative’ and ‘climate positive’. ‘Carbon positive’ and ‘carbon negative’ are used to indicate a net removal or reduction of carbon dioxide from the atmosphere. This is a source of potential confusion. ‘Carbon positive’ can be read as numerically positive emissions (bad for the climate); and, ‘carbon negative’ is limited because it defines a good action in the negative. To limit confusion, we refer to all concepts that seek to convey net gain with the generic term ‘climate positive’.

In 2019, we studied the climate commitments of the Fortune Global 500. ‘Carbon neutral’ action and targets outnumbered ‘climate positive’ 17:1, with three companies referring to ‘positive’ targets (Natural Capital Partners, 2019, Deeds not Words, http://info.naturalcapitalpartners.com/500, page 26)

Many climate positive actions and targets lack the structural integrity of other actions such as CarbonNeutral® certification. Some have complex or ill-defined goals. Of the three with climate positive actions/targets in the Fortune Global 500, just one provided a clearly defined and transparent climate positive goal.

Our working definition of ‘climate positive’ is ‘a term indicating that an entity is taking or causing action beyond carbon neutrality by removing GHGs from the atmosphere or reducing emissions to the atmosphere such that the aggregated reductions and removals exceed the unabated emissions from the subject’.

The certification type we use for CarbonNeutral® certifications (Entity, Product, Activity) is also helpful here because some ‘climate positive’ targets apply to individual products not the whole business.

Natural Capital Partners’ research currently defines three main ‘climate positive’ archetypes for entities, products and activities to go beyond neutral greenhouse gas emissions (GHG).

These are as follows:

  1. ‘Over-offsetting’ the subject’s footprint by a given percentage
  2. Deploying technology or solutions within the value chain that reduce GHG emissions e.g. producing and distributing more renewable energy than is consumed by the providing entity
  3. Deploying technology or solutions within the value chain to sequester GHG emissions

Some businesses choose to focus on only one of the above archetypal methods, while others pick a range of actions to become positive. There is also variability as to how much the actions to become positive are integrated into the organisation’s wider sustainability plan.

The concept of net gain is attracting interest and with wider use is becoming better defined and understood. However, there is no working definition as yet that meets all the Principles that underpin the CarbonNeutral Protocol (see Introduction), especially the second principle that states:

“claims… account for greenhouse gas emissions and the compensating emission reductions in accordance with best-in-class third-party standards to ensure that claims have integrity and the same meaning throughout the global economy. Entities making public claims… commit to conservative approaches and to disclosing the basis (methodologies, standards, protocols) that underpin their claims”.

For that reason, caution is advised in making public claims around climate positive.