The EU as a normative power? Fighting greenwashing and promoting the integrity of corporate climate action within and outside Article 6 of the Paris Agreement

Abstract

This policy brief explores different options for the EU to promote the integrity of corporate climate action through activities within as well as outside the EU and partially making use of the Article 6 infrastructure. Taking into consideration the new framework conditions established with the adoption of the Paris Agreement, the paper outlines different options of how the EU could push towards more integrity and fight greenwashing. Key recommendations: The EU should continue excluding the use of carbon credits as offsets for achieving its own NDC. This step should be complemented by measures to promote the integrity of other actor’s use of carbon credits, including non-state actors. In the area of corporate offset claims, the EU should work towards minimizing the most adverse effects of ongoing offsetting practices by strengthening the regulation of corporate claims. In case a generic ban on offset claims is not implemented, the requirements for the substantiation of claims and the provisions for offsetting should be further specified, by for instance prohibiting double counting of emission reductions. In addition to tightening the rules for corporate offset claims within Europe, the EU could support partner countries in making informed decisions about the authorization of mitigation activities and carbon credits. As the EU has no intention to acquire emission reductions, it could act as an honest broker and support countries in developing a strategy that best serves their interests. Finally, the EU could engage in the emerging field of the contribution claim model, which has been proposed as an alternative to conventional offsetting. To counter the risk of the contribution claim model being used for greenwashing purposes, the EU could develop a contribution claim label that is only granted to companies that meet minimum requirements as verified by accredited third-party verifiers. Companies meeting the requirements would be included in a public registry that would also serve as a tool to link investors with high-integrity mitigation activities. As a stepping stone towards establishing such label, the EU could develop an open database that allows to compare the different concepts that have been proposed as well as a generic contribution claim guidance. With these initiatives, the EU could support the uptake of this new model as a valuable alternative to conventional carbon offsetting.