Carbon insetting is a relatively new concept that encompasses the reduction of greenhouse gas (GHG) emissions within the corporate value chain. Under this approach, companies take full responsibility for their emissions, which is key to meeting the Paris Agreement's climate change mitigation targets, as the private sector is considered to account for 84 % of global GHG emissions.
Although the concept is not yet widespread in Latin America, there are already companies that are implementing it effectively. This approach is also becoming particularly relevant given the entry into force of international regulations, such as the European Deforestation Directive, which requires companies to demonstrate that their products do not contribute to deforestation. Companies that adopt carbon offsetting can maintain their competitive advantage by complying with international regulations, and even strengthen it by meeting the demands of consumers and investors, who are increasingly aware of sustainability...
To illustrate the practical application of this strategy, three case studies have been selected to demonstrate innovative approaches in different sectors and geographies:
This study is part of the Catalytic Green Fund1. The resources for its development come from IDB Lab project RG-T4301, which consists of supporting initiatives and ventures that provide solutions for reducing greenhouse gas emissions in value chains (with special attention to Scope 3 emissions).
1. The Green Catalytic Fund is an initiative led by Latimpacto, in partnership with the Green Climate Fund, the Inter-American Development Bank (IDB), IDB Lab, Bayer Foundation and Coca-Cola. It promotes decarbonization in Latin America and the Caribbean, with special emphasis on the Amazon Basin.
