Why Carbon Offsets Undermine Sustainability Goals

As more companies pledge ambitious net-zero targets, carbon offsetting is gaining interest as a sustainable strategy. This approach involves investing in projects that reduce or remove carbon emissions elsewhere to cancel out one's own emissions. Popular offset projects range from reforestation and renewable energy initiatives to energy-efficiency programs. However, an overreliance on carbon offsets can detract from, and even undermine sustainability goals.

At its worst, offset programs can put indigenous rights in peril. Reports have revealed that reforestation projects for carbon offsets have led to the forced eviction of indigenous peoples from their lands in regions such as the Democratic Republic of Congo, the Amazon, Kenya, Malaysia, and Indonesia. These actions violate human rights and have devastating consequences for local communities.

Studies and analysis have also shown an increase in the failure of offset projects to deliver promised benefits. According to an investigation by The Guardian and Corporate Accountability, 78% of the top 50 emission offset projects were likely worthless. In some cases, the climate benefits would have happened anyway, with or without the credit offset market. In other cases, the projects leak greenhouse emissions or shift the emissions elsewhere. The vast majority could not guarantee additional and permanent carbon reductions.

Further scrutiny of Verra, the world’s leading carbon credit certifier, has raised severe credibility issues. Investigations showed that over 90% of their rainforest offset credits did not represent genuine carbon reductions. These credits were awarded for preserving areas where the baseline scenarios of forest loss appeared to have been exaggerated by 400%.

Even if the system were flawless, carbon offsetting alone cannot solve the climate crisis. Take reforestation, one of the most popular types of projects, as an example. The benefits are often delayed—newly planted trees may take decades to capture the promised CO2. The cuts are only temporary, as most of the absorbed carbon returns to the atmosphere if the trees die, whether from climate disasters, logging, or old age.

Ultimately, carbon offsetting is no substitute for genuine carbon reduction efforts. Companies must move away from business-as-usual practices and embed sustainability into the core of their operations. It should be a holistic approach that encompasses the use of renewable resources, waste reduction and recycling, enhanced energy efficiency, responsible water stewardship, and green product design. By prioritizing these tangible actions, we can drive meaningful change toward a better future for all.

<span class="story_highlight">Research is based on information from Carbon Brief, The Guardian, Green Peace, and MIT Climate Portal.</span>