The VCMI’s dangerous goal
VCMI defines itself as “a multistakeholder platform to drive credible, net zero-aligned participation in voluntary carbon markets (VCMs)”. The organization was launched in 2021 with a large financial support from the UK government to “ensure voluntary carbon markets make a significant and meaningful contribution to climate action and limit global temperature from rising to 1.5 ˚C above pre-industrial levels”. Its Claim Code of Practice is a document that defines which claims can be made by companies relying on carbon offsets and what criteria must be met to make them.
The purpose of the VCMI raises major questions. Indeed, as Reclaim Finance and Amazon Watch previously underlined, offsetting is not about trapping past emissions but about enabling current and future emissions. At best it simply displaces – and does not reduce – emissions. This characteristic makes any initiative aiming at scaling up the offset market at best hazardous from a climate perspective. If companies are not forced to massively reduce their emissions before relying on any offset, or if the high quality of offsets is not ensured, such an initiative became a major greenwashing endeavor.
Unfortunately, the VCMI framework belongs to this last category. Despite claiming to want to build a high quality and credible carbon market, the VCMI does not require sufficient information to ensure that companies relying on offsets and making commercial claims based on them are truly transitioning. On the contrary, the VCMI approach would give credibility to corporate efforts to greenwash their activities.
Insufficient requirements to ensure Paris-alignment
Following the Claim Code, companies making VCMI-related claims must adopt “science-based” net-zero targets in line with a 1.5°C trajectory. However, the framework does not define how the “science-based” nature of the targets will be ensured, nor require these targets to be set based on climate scenarios with limited reliance on negative emissions.
Furthermore, target requirements are too imprecise to guarantee sufficient emission reductions:
- Long-term targets do not ensure sufficient emission reductions (these should be at least 90% by 2050);
- Medium-term targets do not include a mandatory emission reduction target of at least 50% by 2030;
- All targets are set on a limited proportion of scope 3 emissions.
Additionally, the VCMI fails to consider the specific characteristics of companies in high-emitting sectors. Indeed, beyond emissions reductions, companies in high-emitting sectors should meet certain milestones that clarify their contribution to the transition of the sector. For example, the IEA NZE scenario shows companies in the energy sector must immediately stop new fossil fuel supply projects and swiftly phase out coal power. Such concrete requirements are not included in the Claim Code.
Beyond the fact that the criteria set at company level are insufficient to ensure compatibility with climate goals, the VCMI also enables certain claims that could greatly contribute to greenwashing.
Indeed, the VCMI makes three significant mistakes:
- Allowing companies that “offset” 100% of their emissions to claim to be “Net Zero”:
The “VCMI Gold” standard is linked to a “Net Zero” claim. However, carbon neutrality should require first and foremost emission reductions. Offsets can only be used to claim carbon neutrality if emissions have already been drastically reduced and only a small residual volume of emissions remains.
- Providing carbon neutral credentials to products, brands and services:
Carbon neutrality is a global concept that cannot be applied at the level of a brand, product or service. The deep emission reduction necessary to justify carbon neutral claims cannot be insured at this level. Linking a product or service to carbon neutrality would be misleading and could contribute to hide emissions from consumers and clients, thus impairing the transition on the demand side of the economy.
- Authorizing certain companies that fail to meet their decarbonization targets to benefit from VCMI credentials:
The “VCMI Bronze” standard enables companies that would not meet their own emission reduction targets to still make offsetting claims. This provision is a clear breach of the mitigation hierarchy. Emission reductions must be prioritized and enabling companies to claim environmental progress while failing on emission reductions cannot be justified.
With the VCMI’s Provisional Claim Code of Practice, voluntary carbon markets could be a dangerous greenwashing tool. If high quality offsets can be considered to provide an additional contribution to environmental preservation and climate mitigation, they must never replace emission reductions or give financial institutions, clients and consumers a false sense of “greenness”. To ensure that, the VCMI must drastically review its position to – at least – avoid misleading carbon neutrality claims and ensure companies using offsets truly contribute to limiting global warming at 1.5°C.