Following on from my recent piece about what pinstripes need to do to save the planet, it’s worth looking at the current debate surrounding carbon offsetting and carbon trading and asking what businesses can do.

On the face of it, carbon trading seems a neat solution – creating a market for carbon emissions that allows them to be traded like any other commodity, penalising heavy producers and rewarding those that cut emissions.

Carbon offsetting – the idea that carbon emissions can be neutralised by paying for an initiative like planting trees and investing in renewable energy to soak up the resulting CO2 – has become big business with estimates that it is now worth £15bn per year. And whilst carbon trading markets in Europe are under massive scrutiny, offsetting has also come under sustained attack recently.

The New York Times recently ran a piece asking if, in fact, “the Carbon-Neutral Movement Just a Gimmick?’. The author felt that:

“Some believe it helps build support, but others argue that these purchases don’t accomplish anything meaningful — other than giving someone a slightly better feeling (or greener reputation) after buying a 6,000-square-foot house or passing the million-mile mark in a frequent-flier program. In fact, to many environmentalists, the carbon-neutral campaign is a sign of the times — easy on the sacrifice and big on the consumerism”.

The article continues quoting Denis Hayes, president of the Bullitt Foundation, an environmental grant-making group:

“The worst of the carbon-offset programs resemble the Catholic Church’s sale of indulgences back before the Reformation. Instead of reducing their carbon footprints, people take private jets and stretch limos, and then think they can buy an indulgence to forgive their sins. This whole game is badly in need of a modern Martin Luther”

Michael R. Solomon, the author of “Consumer Behavior: Buying, Having and Being” is not surprised by the allure of the carbon-offsetting market:

“Consumers are always going to gravitate toward a more parsimonious solution that requires less behavioral change,” he said. “We know that new products or ideas are more likely to be adopted if they don’t require us to alter our routines very much.”

Marissa-Catherine Carrarini on www.newconsumer.com writes that

..in February this year environmental activists Rising Tide occupied the offices of The CarbonNeutral Company to protest against the culture of carbon offsetting. Rising Tide reckons carbon offsetting allows consumers, business and government to continue guilt-free with damaging, polluting habits.

Worse, it continues that..

..the Forests and European Union Resource Network (FERN) not only ridicules the science behind planting trees, it begs the question as to whether anyone can really calculate how much carbon any tree will soak up. Plus it highlights that carbon neutral monoculture plantations are damaging land that is key to the survival of many communities in places like Brazil and Tanzania. News published today by the National Academy of Scientists in the US also suggests tree-planting outside of the tropics might actually accelerate climate change.

Friends of the Earth director Tony Juniper is also not convinced:

'Carbon offsetting schemes are being used as a smoke-screen to avoid real measures to tackle climate change. We urgently need to cut emissions, but offsetting schemes encourage individuals, businesses and governments to avoid action and carry on polluting,' he says. Furthermore, almost all carbon offsetting schemes will only become effective in years to come. But climate change needs to be stopped now. Tomorrow is close to being too late.

So, what are businesses who are serious about climate change to do?

Firstly, we can realise carbon trading and offsetting should really be a last resort, and that the first steps should be to try and reduce emissions.

But, if offsetting is necessary – and let’s be realistic, no organisation can eliminate emissions entirely – businesses should choose the most effective offsetters. As reported in New Consumer, the Swedish Gold Standard accreditation scheme promotes four UK organisations as the most effective: Pure, Carbon Offsets, Global Cool, and Equiclimate. These organizations sponsor renewable energy projects, or - in the case of Pure - buy up and cancel big businesses licenses to pollute. The UK government is also to set up its own voluntary offsetting standard in the summer.

If your organisation has any experience in this area, or you have any comment to make please join the debate by adding comments below.