A new analysis reveals that many major corporations, including some of the world's biggest polluters, have been relying on flawed carbon offset projects to meet their climate goals.
This suggests that their claims about reducing pollution may be exaggerated, according to the Guardian.
What happened?
Corporate Accountability, a non-profit watchdog group, analyzed the carbon offset projects used by 50 top companies like Delta, Gucci, ExxonMobil, and Nestlé.
They found that for 33 of these corporations, over a third of their offsets came from projects that are "likely junk" — meaning they have fundamental issues that undermine their promised pollution cuts.
For example, some projects would have happened anyway without the offset funding, like large hydroelectric dams. Others simply shifted pollution elsewhere rather than truly reducing it, which is common with forestry projects.
The oil and gas industry was the biggest buyer of these questionable offsets.
Why are these carbon offset projects concerning?
Many companies champion carbon offsets as a key part of their climate action, allowing them to claim carbon neutrality while still relying heavily on polluting energy sources.
But if a large portion of these offsets are essentially worthless, it means corporations have been significantly exaggerating their progress in cutting pollution.
Climate experts say the voluntary carbon offset market has largely failed to drive real planetary benefits. Instead, it's delayed the transition away from polluting industries while sometimes harming forests and communities where offset projects are located, often in developing countries.
Ineffective offsets are fundamentally flawed as a climate solution.
"This research once again shows that big corporate polluters claiming climate credentials are the main buyers of junk credits," said Erika Lennon, senior attorney at the Center for International Environmental Law. "But racking up carbon credits doesn't make you a climate leader. Cutting fossil fuels does.
"We can't offset our way to a safe climate future. For all the talk about carbon credits accelerating climate action, they are actually greenwashing climate destruction."
Greenwashing is the practice of exaggerating or falsifying "green" environmental initiatives to cover up or distract from polluting practices.Â
What's being done about ineffective offsets?
Some companies have already started moving away from relying on offsets after acknowledging the mounting evidence that they don't reliably cut pollution. For instance, Delta shifted to investing in sustainable aviation fuel and more efficient aircraft instead, and Gucci dropped its carbon neutral claim to focus on absolute emissions cuts in its supply chain.
While the Biden administration recently released guidelines to improve the offset market, critics argue stronger actions are needed. The most effective solutions are to rapidly phase out polluting energy sources, protect forests, and transition to cleaner practices.
Supporting policies and companies driving real pollution cuts, not just buying offsets, is important to help chart a difference in the long run.
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