Climate Change Risks Drive Businesses To Reduce Emissions
The Imperial College London survey, conducted in consultation with ICROA and the UNFCCC, assesses the business demand and preferences for voluntary carbon credits to offset emissions.
Overall, 94% of respondents feel that organisations should reduce their greenhouse gas (GHG) emissions, even when not required to do so by law, and 79% believe that climate change poses a risk to their organisation.The results of the survey show that respondents across a wide range of sectors are primarily using offsetting to take responsibility for their GHG emissions and see it as a solution to mitigate their impact on the environment.
“The effects of climate change, such as extreme weather events and supply chain failure, pose real threats to business,” says Simon Henry, ICROA Programme Director. “Voluntarily offsetting their emissions allows businesses to play a role in this global challenge and take steps to mitigate their climate impact.”
Beyond carbon mitigation, offset projects generate a range of co-benefits to communities such as health improvements, alternative livelihoods, water stewardship and biodiversity conservation. These co-benefits can increase the willingness to pay for offsets, and 81% of respondents think these extra benefits should be verified.
“This report provides important insights into what attributes make offsets more or less attractive to companies, in addition to climate change mitigation. Clearly aspects such as co-benefits associated with the offsets are important which may also be useful to consider for new market instruments emerging in the UNFCCC process,” says Niclas Svenningsen, Manager for Strategy and Relationship Management, UNFCCC.
Businesses have a preference for domestic and local projects. Increasingly, they are also looking to use carbon finance projects to lessen their environmental impact within their own supply chains.
A better recognition of the contribution of offsetting to climate change mitigation would increase the use of offsets, respondents said. Furthermore, half of offset users say they have experienced tangible benefits from voluntary offsetting, ranging from market differentiation to employee engagement. More data on these benefits would help build the case for more businesses to take voluntary action.