A recent policy change by the Science Based Targets initiative (SBTi), the primary global verifier of corporate climate targets, has caused controversy. The reason behind the contention is to achieve net-zero targets, the organisation will permit businesses to use carbon credits to offset their Scope 3 emissions, including those from throughout the value chain.
The response to this move has been far from uniform. While businesses have lauded the decision, environmental organisations have raised serious objections, creating a stark contrast in viewpoints.
Scope 3 emissions include all the carbon emissions a business generates indirectly. It includes travel for business, employee commuting, waste disposal, purchased goods and services, commodities produced, product end-of-life disposal, transportation, distribution, and other activities.
Why the Change of Heart?
Previously, SBTi had a strict stance against businesses using carbon credits to offset their emissions. However, following a comprehensive six-month consultation, SBTi revised its corporate net-zero requirement. The new policy allows companies to offset Scope 3 emissions using carbon credits and other environmental attribute certificates, provided their initiatives are supported by policies, standards, and procedures grounded in scientific evidence prohibiting such carbon credits.
What Sparked the Controversy?
Environmentalists share concerns over the legitimacy and efficacy of carbon credits. They refer to allegations of fraud and exaggerated claims related to certain carbon offset initiatives.
While acknowledging these worries, SBTi has clarified that they would not be directly verifying the validity of carbon credits. Instead, they will provide policies for other standards organisations in charge of credit verification. But it’s still unclear what precisely these recommendations entail.
Industry Happy, Environmental Watchdogs Unhappy
The business community is pleased with the modification. According to the corporate climate action group ‘We Mean Business Coalition,’ this will incentivise businesses to use cutting-edge emission reduction techniques across their supply chains. They claim that it might provide developing countries with desperately needed climate funding.
According to the International Emissions Trading Association, a proponent of the carbon market, this is a reasonable way for companies to participate in climate action. They highlight how the voluntary carbon market is changing and how it is working to raise the caliber of projects.
Greenpeace International vehemently disagrees, claiming that reliance on carbon offsets damages SBTi’s reputation and diverts attention from the pressing need to reduce emissions. A non-profit organisation called Carbon Market Watch expressed similar worries, arguing that this action permits businesses to maintain their pollution levels while disguising their actions as environmentally friendly.
Internal Conflict
Rumours of internal discord at SBTi are further fueling the dispute. Several SBTi employees reportedly questioned the scientific validity of the carbon credit policy shift and demanded the CEO’s resignation.
