{"id":18716,"date":"2024-01-30T12:01:05","date_gmt":"2024-01-30T11:01:05","guid":{"rendered":"https:\/\/www.etifor.com\/en\/?p=18716"},"modified":"2026-10-05T15:18:18","modified_gmt":"2026-10-05T13:18:18","slug":"responsible-corporate-climate-strategies","status":"publish","type":"post","link":"https:\/\/www.etifor.com\/en\/updates\/responsible-corporate-climate-strategies\/","title":{"rendered":"The Role of Nature-Based Solutions in Responsible Corporate Climate Strategies<\/span>"},"content":{"rendered":"

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What does compensation mean, and what role does it play in corporate impact reduction pathways? What are the most suitable approaches and tools?\u00a0<\/span><\/p>\n

A short guide to help companies understand how to credibly, effectively, and responsibly integrate nature-based solutions<\/a> into their climate and nature-positive strategies.<\/span><\/p>\n

Introduction: The Importance of Being <\/b>Honest<\/i><\/b><\/h2>\n

It\u2019s a dynamic time to work in sustainability. A growing number of companies all over the world are making commitments to reduce emissions and play their part in decarbonising the global economy. According to the latest data, enterprises covering 34 % of the global economy by market capitalisation have committed to net-zero emissions using Science-Based Targets<\/span>, while more than 140 countries – accounting for about 90 % of global annual emissions – had announced or are considering net-zero targets in line with the Paris Agreement<\/span>.<\/span><\/p>\n

At the same time, we are coming to understand that not all climate commitments or action plans are equal, and the risk of greenwashing has kept pace with climate action. <\/span>Increased scrutiny<\/b> from regulators, civil society organizations, and news media has raised awareness about the proliferation of <\/span>false, misleading, miscalculated, or oversimplified climate-related claims <\/b>based on poor-quality compensation projects and\/or low integrity corporate climate strategies ( \u2192 See Section 3).<\/span><\/p>\n

In particular, attention has focused on misleading\u00a0 claims resulting from <\/span>nature-based solutions<\/b> (NBS) like tree planting or forest protection, with many companies – notably<\/span> Nestle, Gucci, and Kering<\/span><\/a> – recently pulling back on their nature-related investments due to uncertainties concerning their validity or relevance.\u00a0<\/span><\/p>\n

Concurrently, several <\/span>political, financial and commercial drivers<\/b> are pushing the transition towards responsible corporate climate performance while exposing non-compliant companies to legal and reputational risks. Mandatory extra-financial disclosure frameworks like the CSRD and restrictions on green claims from the EU Green Claims Directive are forcing tighter and more narrow pathways for implementing climate strategies. In parallel, <\/span>investor and consumer demand <\/b>increasingly directs funding towards business activities demonstrating a credible and reliable commitment to sustainability.\u00a0<\/span><\/p>\n

Many companies feel squeezed on both sides – on the one hand, it\u2019s clear that the private sector plays a critical role in closing the financial gap for biodiversity and climate change mitigation by supporting ecosystem conservation and restoration; on the other, companies are unsure how they can responsibly and credibly\u00a0 integrate nature-based solutions into their sustainability transition plans.\u00a0<\/span><\/p>\n

So, what is the role of NBS in a credible climate strategy? How do we reconcile\u00a0 uncertainty with urgency? How can we distinguish between evidence-based action and greenwashing? How can we embed <\/span>honesty <\/span><\/i>in our ambitions? To answer these questions,\u00a0 we must first take a step back and agree on a\u00a0 few fundamental terms.<\/span><\/p>\n

Key terminology<\/h2>\n

There is currently a lot of confusion about the proliferation of specific and technical terms associated with corporate climate strategies. Language is important as responsible and credible pledges must be based on transparent communication to inform all stakeholders fully and unambiguously. To understand the relationships between <\/span>financial instruments<\/b> to remunerate nature-based solutions, their use in <\/span>carbon inventories<\/b> and the resulting impact on companies’ <\/span>climate credentials<\/b>, we first need to distinguish between nature-based <\/span>impact statements <\/span><\/i>and <\/span>the way<\/span><\/i> these statements are used by sponsors – in other words, we need to distinguish nouns from verbs.<\/span><\/p>\n

Nature-based impact statements, such as carbon credits or pure <\/span>claims<\/span><\/i>,<\/span> are <\/span>nouns<\/b>. They represent a real, tangible impact on the ground. The table below shows the main features:<\/span><\/p>\n

\"Figure<\/p>\n

Figure 1. Main features of two types of nature-based impact statements<\/span><\/i><\/p>\n

On the other hand, practices like offsetting, neutralization or beyond value chain mitigation – which are all different forms of <\/span>compensation<\/span><\/i>– refer to the <\/span>use <\/b>of verified impacts, i.e. they are\u00a0 <\/span>verbs<\/b>, as explained in the following infographic:<\/span><\/p>\n

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Figure 2. Different uses of verified impact statements<\/span><\/i><\/p>\n

Nature-based impact statements (<\/span>nouns<\/span><\/i>) and their strategic use by companies (<\/span>verbs<\/span><\/i>) are combined in different ways and to varying extents to <\/span>substantiate claims<\/b> about overall company emissions performance – e.g. Net Zero, Climate\/Carbon Positive, etc.\u00a0<\/span><\/p>\n

This distinction was made to emphasize a fundamental concept. The terms \u2018carbon credits\u2019 and \u2018offsets\u2019 are <\/span>not interchangeable<\/b>. Carbon credits <\/span>can <\/span><\/i>be used to back up corporate claims of offsetting emissions or <\/span>can <\/span><\/i>be a tool for channelling climate investments (compensation) without any offsetting claim.\u00a0<\/span><\/p>\n

In fact, new approaches to climate commitments are recently emerging, which assume \u201ccompensation\u201d without the use of \u201coffsetting\u201d, i.e. emissions not being erased from carbon inventories. One effective example is the <\/span>climate contributions model<\/b>,<\/span> which allows companies to take responsibility for their emissions by directing a proportionate share of financial resources for climate action <\/span>beyond their value chain <\/b>without claiming to offset or neutralize any actual emissions. In this way, compensation measures will be complementary – and not alternatives – to impact reduction actions, overcoming all the drawbacks of offsetting and providing a clear indication of the company’s level of climate ambition.<\/span><\/p>\n

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Lose-Lose: The Pitfalls of Compensation<\/b><\/h2>\n

Given the different nuances of the term compensation, let us now analyze both the reasons why it is shrouded in mistrust and those that should justify its use. There are mainly two types of <\/span>risks <\/b>related to the use of project-based emissions avoidance\/removals for compensation:<\/span><\/p>\n