From compensation to contribution: the carbon market is broken, or is it?

In a three-part series of articles ”From compensation to contribution”, we discuss the procurement of climate units and their role in companies’ climate work, even in a partly challenging market situation.

The carbon market is broken, or is it?

”Double counting prevents the use of the Finnish carbon sink for CO2e abatement.”

”Less bad is still bad.”

”Most climate units are unreliable and unconvincing.”

Tough claims to challenge the climate work being done by businesses. Sometimes the criticism hits the target, but often the reality is much more complex. But the very risk of being challenged is enough to paralyse many companies, and cause them not to do anything.

But climate change is moving fast. The worst option for the climate and our future is to wait for regulations to move forward and the market to develop. Corporate climate action is not an isolated measure, but part of a whole, as our society and the world’s nations seek to mitigate climate change and rising temperatures. In this equation, business climate action plays a role beyond compensation, through positive influence.

In the future, contribution, the give-more-than-it-takes mindset, will emerge as a new, and climate-necessary, way of working on climate.

International actors, such as Verra, Gold Standard and SBTi, have also put supporting climate work on their agenda and are refining their guidelines. Supporting climate action is a contribution to achieving a global net zero. While reducing emissions is the first priority, demonstrating climate responsibility through the use of climate units can also begin before emissions are calculated. Because there is no reason to delay starting climate action.

The cornerstones of contribution thinking are:

  1. Credible claims that companies using mitigation units can make. Moving from emphasising your own carbon neutrality to supporting and financing climate work.
  2. A climate roadmap: a transparent strategic tool for climate action, i.e. an emissions reduction plan
  3. Quality units: the contribution indicator does not lower the bar for the quality of climate units
  4. Internal price tag: companies should calculate an internal price tag for CO2e emissions. This will create pressure for emission reductions and contribution

The climate unit even does more good than climate action

In Finland, climate units are produced from additional carbon sequestration from forests. Forest growth and regeneration are achieved by different methods and Green Carbon’s CarbonPlus+ fertilisation method has ISO quality standard and the Key Flag label that helps customers to choose the Finnish alternative. The units produced by the fertilisation method and in collaboration with forest owners are of high quality; verifiable and measurable in a transparent and reliable way. In addition, the location of the units can be located and verified, e.g. by visiting the forest area where the units were purchased.

In addition to carbon sequestration, finnish units also generate other value for Finns and Europe: jobs, tax revenues, more forest and well-being. For the company, this is all a contribution to building the future. There is no reason to wait and see when it comes to acquiring units; the idea of contributing and doing our bit and a little more for the climate makes participation in climate work meaningful.

A Finnish produced climate unit is reliable, transparent and face-to-face.

The article was written by:

Eeva-Liisa Heinaro

Eeva-Liisa is a visiting expert who has gained her insight into the carbon market through international sales roles in the forest industry and by working in the domestic carbon market. Eeva-Liisa is also actively following the developments and complexities of the international carbon market.

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