April 26, 2023

Planting trees vs. compensating

The difference between planting trees and offsetting

The growing interest in sustainability is pushing companies around the world to review their business strategies in order to meet the demands of consumers who are increasingly attentive to these issues. However, it is important that the actions taken are effective and have a concrete impact in the fight against climate change and the reduction of greenhouse gas emissions.

One possible solution is investments in certified carbon credits.

The IPCC (Intergovernmental Panel on Climate Change) has emphasised the importance of an integrated approach to managing greenhouse gas emissions. This requires companies and governments, in addition to reducing their own emissions, to consider offsetting residual emissions through the purchase of carbon credits.

Importantly, the purchase of carbon credits should not replace the reduction of one’s own emissions, but rather be complementary to it. This means that companies must commit to reducing their emissions through the adoption of low-carbon technologies and sustainable business practices, and only then offset residual emissions through the purchase of carbon credits.

The difference between planting trees and financing reforestation projects or protecting endangered native forests

The difference between planting trees and investing in reforestation projects and/or protection of endangered native forests is important for understanding how companies can contribute to the fight against climate change effectively and efficiently.

Planting trees without international certification is a positive action that can have a significant impact on the environment. However, this practice does not guarantee an accurate measurement of the environmental impact of the planting activity. Furthermore, there is no guarantee that the planted trees will not be subsequently removed or inappropriately cut down.

Therefore, planting trees without international certification may be seen as a more suitable option for individuals who simply want to contribute to doing something good for the environment, not to reducing emissions in a global context.

On the other hand, investing in certified carbon credit projects is a more concrete and reliable option for companies that want to activate new sustainability processes. These projects make it possible to invest in activities that effectively reduce greenhouse gas emissions and to obtain certified carbon credits, which can then be used to offset their own emissions.

To do this, there are 4 key requirements that must be adhered to:

Permanence, in that the project must be able to guarantee GHG reduction permanently for a minimum of 20 years.
Additionality, i.e. the fact that the project must bring a real benefit in terms of reducing CO₂ emissions compared to the situation in which the project would not have taken place;
Ex-post monitoring, i.e. the need to accurately quantify CO₂ absorption once the project has been completed. This means that, to ensure project effectiveness, it is necessary to monitor the growth of trees and take into account various environmental factors that may influence their ability to absorb carbon;
The tracking of carbon credits, to ensure that a credit is not used multiple times. It is therefore necessary for credit acquisition to be entered into public registers that are accessible to all to ensure the integrity of the carbon credit system and to prevent fraud and abuse.

The importance of international certifications

Companies that opt to purchase carbon credits certified by recognised standards, such as Verra or Gold Standard, are assured that their carbon offset projects have been assessed and verified by independent third parties, and that they have been able to demonstrate the effectiveness of their actions in reducing greenhouse gas emissions.

It is important that companies choose to invest in carbon offset projects certified by international standards, rather than relying on single tree planting projects without any quality assurance.

Only in this way can companies be sure that their carbon offsetting has a real impact on the climate and that it contributes in a concrete way to the climate change mitigation goals required by international policies.

Supporting local communities

Another advantage of buying carbon credits is that companies can not only offset their greenhouse gas emissions, but also help finance projects with a positive impact on climate change mitigation and the well-being of local communities.

For example, reforestation projects can create jobs for local communities and improve their quality of life, while preserving biodiversity and the natural habitat of animal and plant species in the area.

Furthermore, companies that purchase carbon credits from forest protection, reforestation or community-based projects such as Cookstoves or Clean Water can also support local communities that are affected by climate change, such as those living in areas vulnerable to floods or droughts

Emissions offset projects can include programmes to help local communities improve their adaptation to climate change, such as building dams or irrigation systems or participating in dedicated training courses.

In this way, the purchase of carbon credits not only helps companies reduce their greenhouse gas emissions, but can also have a positive impact on local communities and the environment in general, helping to promote sustainability globally.

The risk of greenwashing

Greenwashing represents a significant risk for companies that try to present themselves as sustainable without actually adopting practices aimed at reducing emissions from their products or services. This phenomenon occurs when companies misleadingly use marketing and communication to make consumers believe that their products or services are Green, when in fact they are not.

This can lead to negative consequences for the company’s image, but also to repercussions on the health of the environment and society in general:

Greenwashing can damage a company’s image and reputation. If consumers discover that a company has made false or exaggerated claims about its sustainability, they may lose trust in the company and stop buying its products or services. This could lead to significant economic losses and could undermine the company’s reputation in the long run;
It may have negative repercussions on the environment and society in general. If companies use misleading claims to present their products or services as environmentally friendly, consumers may choose to purchase these products or services instead of more sustainable alternatives, thinking they are making the right choice for the environment. However, if these products or services are not actually sustainable, this may result in greater environmental damage than the choice of actually environmentally friendly alternatives made by consumers;
Greenwashing may create a sense of inaction in consumers and companies. If consumers believe that all companies are doing their part to protect the environment, they may not feel motivated to look for truly sustainable products or services. On the other hand, greenwashing companies may not feel the need to make real investments in sustainability, thinking they have done enough to be considered green.

There are risks of greenwashing for companies that decide to ‘offset’ their greenhouse gas emissions by simply planting trees, without having the certainty and control that such projects have a real impact on the climate and are supported by international quality standards.