Every part of your brand’s operations — from designing on a laptop, to sourcing raw materials, to shipping finished products — leaves behind a carbon footprint. Every...Read more
Exploring the world of carbon offsetting with Simplizero Ecommerce
by Amy Nguyen | Jan 20, 2022 | Carbon offsetting
With Simplizero Ecommerce, at Green Story we support a diversified portfolio of projects around the world that cover everything from social infrastructure, renewable energy to reforestation. We believe each of us has a responsibility to clean our skies, green our planet and contribute to prosperous communities. What distinguishes our work is our ability to provide brands with tailored recommendations of carbon offset projects based on their product’s supply chain location and brand’s values. Our carbon offset platform, Simplizero Ecommerce, covers the carbon emissions of products and deliveries. This is all in pursuit of our Green Story vision to empower one billion consumers to know their impact and make choices that are better for the planet and future generations to come.
To explore the mission behind Simplizero Ecommerce, we wanted to dissect and share important information relating to carbon offsetting. What is it? What are the conditions that make it successful? How can it be a powerful tool to drive a positive climate impact? Lastly, we uncover why transparency in this space is necessary to communicate the positive impact of their products to citizens in an authentic and truthful way.
What is carbon offsetting?
The World Resources Institute defines a carbon offset as “a unit of carbon dioxide-equivalent (CO2e) that is reduced, avoided, or sequestered to compensate for emissions occurring elsewhere”. Carbon offsets provide financial support for greenhouse gas (GHG) reduction projects around the world.
These emissions, be that carbon dioxide or methane, are generated by global value chain operations, including raw material extraction, production as well as distribution and consumer use.
With carbon offsets, the carbon footprint of a product can be calculated and subsequently paid and compensated via projects that work to remove a volume of carbon from the atmosphere by sequestration or avoiding future emissions.
Carbon offsetting projects vary in their size and scope. For example, they may focus on reforestation, forest protection, land conservation and restoration and building the infrastructure for renewable energy sources such as biogas, biofuel, solar power and wind. Alternatively, they could also come in the guise of projects with a socio-economic community focus such as clean water access, transforming poultry litter to power renewable energy and creating clean, energy efficient cooking stoves in rural villages. Simplizero also ensures that all of our projects are situated in locations where it is imperative to enable a phase out of fossil fuel activities.
It is important to note that companies that heavily rely on fossil fuels should not be allowed to use carbon offsetting projects to mitigate their total environmental impact. Instead, as a priority, the funds dedicated to offsetting carbon should also be attributed to investment in research and development for innovation, such as clean technologies, that can help deliver on progress to reach climate targets set out in the 2015 Paris Agreement.
The status of the carbon offsetting market
The voluntary carbon offsetting market is comprised of corporates, institutes and individuals who wish to make greenhouse gas emission (GHG) compensation claims. The voluntary carbon market is intended for companies that firstly act with integrity and a genuine commitment to reduce their carbon emissions. Offsetting projects should be treated as a secondary action.
The urgency of the climate crisis, which has been underscored by global institutions and policymakers, now means that many businesses are keen to use carbon offsetting as one tool to help them achieve their various sustainability pledges, especially after the unfolding of COP26.
The appetite has increased exponentially in recent years, as according to Ecosystem Marketplace, the voluntary carbon market is on track for the annual market value record of over $1 billion for the first time. Global consulting firm McKinsey estimates that in 2020, buyers retired carbon credits for some 95 million tons of carbon-dioxide equivalent (MtCO2e), twice as much as in 2017.
What’s more – the Global Voluntary Carbon Market: Dealing With the Problem of Historic Credits led by Trove Research at UCL Geography predicted that the market for carbon offsets could be worth up to $25bn (£18bn) a year by 2030. However, as an increasing number of carbon credits become available, there has been a call from scientific communities to reform and standardise the voluntary market, to ensure that old carbon credits, are no longer considered valid in their offsetting capabilities.
Why carbon offsetting makes sense
There are a myriad of benefits to carbon offsetting, when carried out correctly and when carbon credits have credibility to ensure that they are verified and traceable.
Offsets can be used as an important mechanism to encourage carbon emissions reduction whilst simultaneously supporting environmental regeneration and encouraging socio-economic prosperity of those most vulnerable to the impacts of the climate emergency.
Carbon offsetting activities are also a way for environmental projects to secure funding that they may not have received otherwise. This can have a multiplier effect as once a project has proved its viability, similar projects can attract additional finance and thus further support activities such as forest growth or renewable energy generation.
What’s more – the co-benefits of offsetting can create exponential environmental and social value. For example, this may come in the form of job creation, sustainable infrastructure to support economic development as well as improving environmental and living conditions. All of the Simplizero projects are aligned with the Sustainable Development Goals and work towards reducing poverty and creating better, greener communities.
What are the limitations of carbon offsetting?
When engaging in carbon offsetting or learning more about how a company is incorporating offsetting into their strategy, it must be acknowledged that there are limitations and that the lack of standardized quality criteria validating what is a good offset and what is not can create grey zones.
Carbon offsetting is by no means an instant panacea when it comes to mitigating greenhouse gas emissions and must be incorporated into a holistic strategy that runs in tandem with other activities to reduce a business’s emissions. This includes reducing overall levels of production, designing truly circular products and reviewing their supply chain operations.
Carbon offsetting should not be treated as a license to pollute and it is important to ensure that when engaging with businesses on such projects that all stakeholders understand this. Whilst carbon offsetting projects do reap rewards for local environments and communities in the surrounding areas where they take place, not all carbon offsetting projects permanently lock away emissions and these emissions can’t simply be transferred elsewhere.
For offsetting to be truly successful, it should also draw down more carbon than is being emitted which is currently not happening frequently enough. This particular limitation has been highlighted by the European Commission which found that 85% of the offset projects used by the EU under the UN’s Clean Development Mechanism failed to reduce emissions.
Across various sectors, carbon offsetting activity can also be open to manipulation and greenwashing. This is illustrated by the recent case of Shell, who were reprimanded by the Dutch Advertising Watchdog for their campaign which promoted fuel purchases as ‘carbon neutral’ whereby customers purchasing petrol and diesel could pay an extra fee to fund carbon offsetting.
Why working with Simplizero is about more than carbon offsetting
Green Story favours hyper transparency and as a company, wanted this to translate into how they work with brands to help them to reduce their impact. Akhil Sivanandan, Founder, Co-CEO and CCO of Green Story, shares that it is essential that Simplizero efforts champion transparency and ensure that there is a carbon reduction plan before offsetting is put into place.
Akhil notes that “Simplizero is very much about the everyday person and small steps they can make. How can someone trust that their money is being invested in projects having real impacts on the ground without transparency?”.
He states that it is important for Simplizero to monitor and understand how individual orders are separately tracked in different registries by assigning these a unique registry number. That way – tracing the carbon footprint back to the individual carbon credit is a more effective and accurate way of accounting for the true environmental impact. This method also means that a brand can track it in real-time, as opposed to compiling data and offsetting in one large volume at the end of the year.
The Simplizero carbon offset platform guarantees fully transparent pricing with zero mark up for brands, based on the true cost and platform fees, as opposed to seeking large profit margins. This helps to create a full sense of transparency when offsetting takes place, as opposed to money being syphoned off to a tree somewhere with no way to follow up, explains Akhil.
“We wanted people to have the power to investigate their impact and really see the impact on the ground.” he adds. In Akhil’s eyes, there are exponential benefits for brands and consumers surrounding trust and engagement by using Simplizero. “Showing someone their impact through projects in a real and personal way helps build that connection between brands and their buyers. For example, the email certificate that helps track a carbon neutral purchase has an average 60% open rate among our customers compared to the average 16% open rate for ecommerce.”
The work of Simplizero contributes to Green Story’s overall mission of enabling one billion people to make greener choices and the offering is a first step for many to help encourage mindful consumption.
How can carbon offsetting help brands and their communities understand their environmental impact?
For Adam Taubenfligel, Creative Director and Designer of sustainable denim brand Triarchy, it was important to work with Simplizero to gain a reliable assessment of their practices. “Not only does Simplizero Ecommerce and Green Story take all of our practices and assign carbon emissions to them based on scientific data, they then help us to steer the offset itself into projects that reflect our brand values.” states Taubenfligen.
When a customer receives a pair of Triarchy jeans, they are also provided with a Carbon Offset certificate from Simplizero which shows how much carbon was offset from each individual purchase. This information empowers customers to understand the process and how carbon emissions are offset from that specific pair.
Triarchy does not rely on carbon offsetting but exercises strict responsibility in other areas too as Adam is keen to encourage shoppers to react less on impulse. Alongside their efforts to minimise carbon intensity throughout production, the business has no office space, and is careful about using recycled materials in packaging and removing waste wherever possible.
Adam believes brands have a responsibility to achieve carbon neutrality within their operations. He notes “Picking and choosing responsible practices is better than nothing, but at the end of the day you have to be striving for the best. You can’t shout about sustainability if all of your products are made from plastic, even recycled plastic, they just don’t go hand in hand. Where Simplizero makes this so easy for us is that – even if your practices aren’t where they should be yet, you are still able to start and easily get that carbon offset going in the meantime. Why would anyone not do that?”
Read more information about how Simplizero Ecommerce can help your business offset your products’ carbon footprint here. You can also find out how Green Story can help measure and communicate the positive impact of your products with Know Your Impact.
About Amy Nguyen
Amy is a strategist, researcher and writer focusing on the nexus between sustainable business, fashion, innovation and technology. She works as a consultant for a variety of organisations ranging from environmental think tanks and research advisory firms, to sustainable tech start-ups in the energy and fashion space. In addition to being a Forbes contributor, Amy is the founder of Sustainable & Social, a platform dedicated to deconstructing complex climate issues for a millennial audience. Her mission is to democratise the conversation about sustainable development and to educate and empower citizens in the pursuit of climate action. You can connect with Amy on Linkedin, visit Sustainable & Social website here or follow the company on Instagram, Facebook, and LinkedIn.
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