Understanding the Use of Carbon Credits by Companies: A Review of the Defining Elements of Corporate Climate Claims

Danick Trouwloon; Charlotte Streck; Thiago Chagas; Glenpherd Martinus

doi:10.1002/gch2.202200158

journal article Open Access Feb 25, 2023

Understanding the Use of Carbon Credits by Companies: A Review of the Defining Elements of Corporate Climate Claims

Danick Trouwloon

Charlotte Streck

Thiago Chagas Glenpherd Martinus

Global Challenges Vol. 7 No. 4 · Wiley

View at Publisher Save 10.1002/gch2.202200158

Abstract

AbstractWorldwide, companies are increasingly making claims about their current climate efforts and their future mitigation commitments. These claims tend to be underpinned by carbon credits issued in voluntary carbon markets to offset emissions. Corporate climate claims are largely unregulated which means that they are often (perceived to be) misleading and deceptive. As such, corporate climate claims risk undermining, rather than contributing to, global climate mitigation. This paper takes as its point of departure the proposition that a better understanding of corporate climate claims is needed to govern such claims in a manner that adequately addresses potential greenwashing risks. To that end, the paper reviews the nascent literature on corporate climate claims relying on the use of voluntary carbon credits. Drawing on the reviewed literature, three key dimensions of corporate climate claims as related to carbon credits are discussed: 1) the intended use of carbon credits: offsetting versus non‐offsetting claims; 2) the framing and meaning of headline terms: net‐zero versus carbon neutral claims; and 3) the status of the claim: future aspirational commitments versus stated achievements. The paper thereby offers a preliminary categorization of corporate climate claims and discusses risks associated with and governance implications for each of these categories.

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Details

Published: Feb 25, 2023
Vol/Issue: 7(4)
License: View

Authors

D

Danick Trouwloon

Climate Focus Van Diemenstraat 170 Amsterdam 1013 CP The Netherlands; Copernicus Institute of Sustainable Development Utrecht University Heidelberglaan 2 Utrecht 3584 CS The Netherlands

C

Charlotte Streck

Climate Focus Schwedter Strasse 235 10119 Berlin Germany; University of Potsdam International Relations and International Politics Am neuen Palais 10 14469 Potsdam Germany

T

Thiago Chagas

University of Eastern Finland UEF Law School Joensuu campus. P.O. Box 111 Kuopio FI‐80101 Finland

G

Glenpherd Martinus

Centre of Expertise Global and Inclusive Learning The Hague 2521 EN The Netherlands; The Hague University of Applied Sciences Johanna Westerdijkplein 75 The Hague 2521 EN The Netherlands

Cite This Article

Danick Trouwloon, Charlotte Streck, Thiago Chagas, et al. (2023). Understanding the Use of Carbon Credits by Companies: A Review of the Defining Elements of Corporate Climate Claims. Global Challenges, 7(4). https://doi.org/10.1002/gch2.202200158

Understanding the Use of Carbon Credits by Companies: A Review of the Defining Elements of Corporate Climate Claims

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