Corporate climate advisors told Insider what makes a pledge credible or misleading. The amount of jargon thrown around in climate circles can feel dizzying.
That said, there are global efforts underway to rid the market of greenwashing and help companies trying to slash their greenhouse-gas emissions do it with integrity and transparency. Regulators are also ramping up scrutiny of the sustainable-finance markets. A credible net-zero goal also includes near-term targets, because absent short-term goals it appears as though corporate leadership isn't serious, said Mike Wallace, the chief decarbonization officer at Persefoni, a software company that helps companies disclose their climate footprint.
The initiative has strict criteria for net-zero goals, including requiring that companies reduce emissions as much as possible before purchasing carbon offsets to meet the goal. SBTi also ensures that a company's climate strategy is aligned with limiting global warming to 1.5 degrees Celsius above preindustrial levels.
This assertion typically indicates that the company is buying offsets to compensate for emissions it hasn't reduced on its own. A carbon offset represents one ton of carbon that was prevented or removed from the atmosphere because of a project elsewhere in the world, such as protecting forests or building renewable-energy plants.
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