Growing doubt over the real emissions reductions sold as voluntary carbon credits, after revelations that most credits from some forestry projects reduced nothing at all.
Carbon credit integrity refers to the growing doubt over the reality of emissions reductions sold as credits on the voluntary market, which allow a company to offset part of its emissions by funding a project supposed to avoid or sequester them elsewhere. A journalistic investigation published in January 2023 found that a very large majority of avoided-deforestation credits certified by Verra, the leading certification body on the voluntary market, corresponded to largely overstated or fictitious reductions, for lack of a genuinely credible deforestation baseline. This scandal directly weakened companies, several insurers among them, that had publicized carbon-neutrality commitments partly based on these credits, turning a communications asset into a proven greenwashing risk. The sector's response took the form of the Integrity Council for the Voluntary Carbon Market, which published Core Carbon Principles in 2023 meant to distinguish high-quality credits from the rest of the market. For an insurer, this episode had a direct effect on how it now documents any use of carbon credits in its climate communications, with a traceability and verification standard far higher than what prevailed before 2023.
In January 2023, an investigation by The Guardian, Die Zeit and SourceMaterial found that more than 90 percent of the avoided-deforestation credits Verra had certified for the forestry projects examined likely corresponded to no real emissions reduction at all, shaking confidence in the voluntary carbon market.
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