Carbon Neutrality Definition: Everything You Need to Know

Rainforest Landscape In Aberdare National Park, Kenya

As sustainability continues to take center stage in the corporate world, achieving carbon neutrality is the hot-button issue for leaders and organizations alike.

Carbon neutrality represents an organization balancing carbon emissions with an equivalent amount of carbon removal or offsetting, resulting in a non-negative climate impact. Achieving carbon neutrality highlights companies wanting to remove the carbon footprint linked to their productive activities. At Handprint, we typically view this in the industrial processes, travel, and energy production or consumption. 

Unfortunately, we have witnessed companies striving to achieve carbon neutrality as a marketing tactic. Carbon dioxide emissions are not a buzzword or a phase. A regenerative planet requires a true commitment to measuring the carbon emissions associated with different companies’ emissions, with the follow through of investing in projects to reduce these emissions and eventually remove them long-term.

On the road towards carbon neutrality, companies have a plethora of options at their disposal, ranging from adopting renewable energy sources and optimizing energy efficiency to implementing sustainable practices, and actively investing in carbon offsetting projects or carbon credits. Embracing this mindset is no longer only moral, but opportunistic for companies to enhance reputation, foster innovation, and attract environmentally-conscious consumers.

The Net Zero Journey

In most contexts, carbon neutrality and Net Zero are interchangeable terms. The British Standards Institution has published PAS 2060 to outline and clarify the standards and differences between the two terms. Following this publication, carbon neutrality encourages the purchase of carbon avoidance credits, whereas Net Zero requires companies to reduce emissions from all their activities, including energy consumption, as much as possible. Net Zero also encourages buying carbon removal credits for the remainder. 

Achieving carbon neutrality is a multifaceted and challenging endeavor, but with commitment and dedication, companies can take significant steps toward this goal. 

Handprint has outlined a seven-step strategy to help companies become carbon neutral:

  1. MEASURE: Conduct a comprehensive carbon footprint assessment. This assessment forms the foundation for setting reduction targets and is built on assessing the organization’s carbon emissions, now referred to as scopes. 
    1. Scope 1: Direct emissions from operations.
    2. Scope 2: Indirect emissions from purchased energy.
    3. Scope 3: Other indirect emissions associated with the supply chain, employee commuting, and business travel.
  2. PLAN: Be ambitious with reduction targets. Be fierce with your participation in regeneration to achieve carbon neutrality.
    1. Establish clear and time-bound goals that reduce greenhouse gas emissions. 
    2. These targets should align with the science-based targets to limit global warming to well below 2 (and ideally below 1.5) degrees Celsius above pre-industrial levels. We recommend a science-based Targets Initiative (SBTi) to certify whether your company is on track.
  3. REDUCE: Implement energy-efficient technologies and practices to reduce energy consumption. 
    1. Invest in LED lighting, energy-efficient appliances, and optimized heating, ventilation, and air conditioning (HVAC) systems.
    2. Transition to renewable energy sources, like solar, wind, or hydroelectric power. 
    3. Consider onsite renewable energy installations or purchasing renewable energy certificates (RECs).
  4. REDESIGN: Rethink, reconceptualize, and reassess products and services. This is especially salient for companies involved in the making, moving, and mining of things. For service companies, the supply chain focus is on implementing sustainable procurement practices. This step is for critical evaluation of the products/services lifecycle and identify opportunities to:
    1. Minimize emissions and waste generation.
    2. Promote circular economy practices.
    3. Optimize the supply chain by collaborating with suppliers to identify ways to reduce emissions. 
    4. Encourage sustainable practices with suppliers already lowering their carbon footprint, and promote circular economy principles. 
  5. INVEST: Support verified carbon offset projects that remove or reduce greenhouse gas emissions. These projects include reforestation, afforestation, methane capture, and many others. Other ways to invest in a net zero approach include:
    1. Purchasing high-quality carbon credits or investing in direct regeneration (for future carbon absorption) that compensates for permanent emissions.
    2. Regarding employees as the biggest corporate investment and investing in awareness campaigns, training, and incentivizing sustainable practices, which also build long-term assets and loyalty. 
    3. Continuing to monitor technology for updated reporting techniques and systems. With modern technology, you can monitor progress towards carbon neutrality, plus regularly disclose emissions data to stakeholders transparently.
  6. GREEN TRANSPORTATION: Carbon neutrality can be met outside office hours. Encourage sustainable or public transportation, cycling, or carpooling for employee commuting. Transition the company fleet to electric vehicles or other low-emission vehicles.
  7. ENGAGEMENT: Learn how partners and potential collaborators can share best practices, knowledge, and resources in the journey toward carbon neutrality.

Regenerative Momentum Starts Today!

Becoming carbon neutral demands commitment at every level of the organization. We encourage companies to integrate sustainability into their core business strategies and foster a culture of environmental responsibility. By implementing these strategies, companies will contribute significantly to combating climate change while enhancing their reputation, attracting environmentally-conscious customers, and driving positive changes across different sectors.

See other articles:

  1. Carbon handprint calculator
  2. What Is The Difference Between Carbon Neutrality, Negative, And Positive?
  3. Shift from carbon neutral to nature-positive