How are you tracking on Net Zero?
3-min read
Making a carbon neutral claim these days seems absolutely wrought with peril. Why? because you can qualify as carbon neutral by just purchasing credits, and consumers are quickly deciding that’s not enough. For brands making raw material purchasing decisions with carbon neutrality in mind, it’s become a real conundrum, seeing how most of the companies who are “carbon neutral” are only so because of credits.
Last week I talked about how Neutral Foods, the real dairy milk brand, is setting an example of how to be credible in this space. Go back and read that if you missed it.
Some industries/products have a pathway to carbon neutrality, but can’t achieve it yet, (because some aspect of the supply chain is not sufficiently evolved, like clean energy), so they purchase carbon offsets in order to make the carbon neutral assertion now.
For the uninitiated: Carbon offsets essentially mean paying someone else to clean up your CO₂ mess by planting trees, erecting wind turbines, or taking other steps to sequester or eliminate greenhouse gases to compensate for what you’ve produced.
The reputational risk of making a carbon neutral claim based off of offsets is that even if you do nothing wrong, consumers can say you’ve been deceitful. Evian, the Danone bottled water brand is being sued for making carbon neutral claims and not making it abundantly clear that they purchase carbon offsets vs having achieved carbon neutrality through a bottled water life-cycle assessment. (Who would ever think bottled water could be carbon neutral anyway? They make plastic bottles.) Nevertheless, this speaks volumes to consumer sentiment around operational, or Scope 1 & 2 emissions.
For brands that source ingredients, there are over 200 sustainability certifications out there and many have to do with reduced emissions. Consumers are trusting brands to do the due diligence on what is really going on behind the certifications they hold. It doesn’t matter if you explicitly make a claim. For example, if you give off sustainability vibes with a tagline like “good for the planet”, but include palm oil in your formula, you probably carry the Responsibly Sourced Palm Oil (RSPO) seal to back up that you are doing your part against deforestation, and therefore you care about the planet.
But that might not be enough anymore. Consumers want to know about GHG impact and if supporting your brand will help achieve carbon neutrality. The answer for palm oil, like so much of the agricultural industry, is: we aren’t sure. This is because the practices to sequester carbon take time to implement and the verification of what’s been captured takes years to quantify.
So, if ag is still determining quantification, imagine how it is for processed ingredients whose science-based targets use assumptions. Moreover, the forecasts themselves make it hard to compare between vendors. Let’s say you source a soluble fiber from Cargill and they pledge to reduce total GHG by 10% in 2025. How does that compare to Ingredion’s target of 25% reduction by 2030?
If you are an emerging brand, this can be overwhelming. Maybe you hardly have a sustainability choice because of availability limitations. Many of you are beholden to whatever your co-man carries anyway. Even if you are sourcing yourself, you are likely not buying direct from the manufacturer – your options are whatever is closest and available through an ingredient distributor, and maybe the only option is mass balance.
Mass balance moral dilemmas
Mass balance is an option to purchase a partial mix of the qualified material. Let’s say you want certified bee-friendly almonds because those almond orchards are planted with wild flowers which enrich the soil and draw down carbon. But there aren’t enough bee-friendly certified almonds to go around, so you might purchase mass balance, like KIND bar is doing, where most of your almonds are certified bee-friendly but some are not. The moral dilemma is you might feel it’s a cop out to go mass balanced. And you’d be right if there’s no effort to move beyond the % you’ve committed. But by increasing demand for this type of product, and setting goals with your suppliers, you’ll spur growers to bring on more bee-friendly almonds, substantiating your promise in working towards carbon neutrality.
As if sourcing and qualifying ingredients for a carbon neutral footprint isn’t hard enough, what happens when a food’s entire value proposition IS carbon neutrality? That story next week.
All my best,
Jennifer