ACCELERATING
SUSTAINABLE GROWTH

Forest carbon credit considered as a non visible forest product” that can be a viable alternative source of income for forest landowners. It’s a metric ton of carbon dioxide equivalent (CO2e), of whichthe emission is newly sequestered and is purchased by GHG emitters as a cost-control measure to make up for emissions occurring elsewhere.

Managing forests for carbon emission offsetting gives the world the opportunity to reverse or at least sequestered the emissions that they have already made or they are about to make into the atmosphere. The total GHG emissions are increasing rapidly. Most of the GHG emissions of all time have been done in the last 40 years of our existence. More GHG emission mean climatic shifts which leads to intensive droughts somewhere and acute floods in other areas of the world. Because of those blindly done deforestation which hampers the smooth functioning of the forest and gets in the middle of the process of habitats having their share of biodiversity.

Researches around the world point to a fact that forests can play a vital role in mitigating the inimical effects of climate change and can help in putting a shackle on this ever-increasing global warming. Quality and Quantity of herbs, restoring the disbalances caused by humans in nature, water as a resource in quantity & quality, providing wildlife a habitat to call home and protecting biodiversity in that habitat.

Forest & Carbon Offset

To get an understanding of the carbon offset markets, we need to know how CO2 is measured and traded for various purposes. CO2 being the major contributor as the GHGs in the atmosphere, promoting global warming. All other gases are not actually come that much into consideration because CO2 is more easily measurable that others. The carbon unit in which it is measured is “metric tons of CO2 Equivalent” often seen written as MtCO2e or tCO2e & also called as “Carbon Credit or Carbon offset”. Currently sellers of carbon offsets are majorly forest landowners who are looking to opening up different forest-based revenue streams by helping out the GHG emitters in exchange of a handsome payday.

Carbon Marketplaces

There are two distinct types of carbon markets; voluntary and compliance markets

Carbon markets are divided into two subdivisions – voluntary &compliance markets.

Voluntary markets exist where companies or individuals buy carbon credits for purely a voluntary basis. Many companies voluntarily purchase carbon credits to demonstrate their commitment to protecting the environment and to demonstrate corporate social responsibility.

Voluntary markets are there for the individuals and companies so that they buy the credits for the sole purpose of showcasing their concern towards the environment, its well-being and their willingness to go above and beyond to correct it. It fulfils their commitment to live up to the corporate social responsibility they owe to the society.

Prices for the carbon offset in voluntary market, globally, can fall anywhere between a wide range.Forest authorities & land usage projects are somewhat larger voluntary carbon project categories than any other kind. There are numerous factors that influence the price determination of carbon credits at the very point in time for e.g.,the type & location of project that is put up against asking for the credits, additional deemed project benefits that will play out to be an influencing factor, marketing efforts & many others.

The emission stays within limit as it is cancelled out by the very nature of the deal and there is no margin left to betray the environment in any case.

Compliance Carbon Market

Compliance carbon markets are such marketplaces through which “regulated by the cap & trade” entities obtain & surrender emissions allowances or better known as ‘offsets’ in order to meet predetermined regulatory targets.

In case of cap & trade programs; participants i.e., both emitters and intermediaries such as financial institutions; both are allowed to trade allowances to make profit from the unused allowances or for meeting regulatory requirements.

As the global crisis is looming over the world, even developing countries are doing their share tocut down carbon emissions. At the 26th climate summit (COP-26) in Glasgow-UK, under the leadership of Prime Minister Narendra Modi, India announced that it will become a carbon-neutral nation by 2070.

Achieving net-zero will mean a balance between the greenhouse gases produced and eliminated from the atmosphere. Being the 3rd most carbon emitter in the world, it is the first time India has set targets and strategies on an international platform to counter the climate crisis.

Prime Minister Narendra Modi declared the following 5-point strategy that will ultimately make India Net Zero by 2070:

• India will get the non-fossil energy capacity to 500 gigawatts by 2030. Currently, the non-fossil energy capacity is 136 gigawatts.
• India’s 50% energy consumption will come from renewable energy.
• It has set to reduce 1 billion tonnes of carbon emission by 2030
• By 2030, India will reduce the carbon intensity by 45%
• And finally, by 2070, India will achieve its net-zero target.

India’s action to counter the global crisis

India is the third most emitter of greenhouse gases in the world. However, it is important to note that there's a stark difference between India’s emissions as compared to the other top polluters. India nearly emits 3 gigatonnes every year, while US and China emit 5 gigatonnes and 14 gigatonnes, respectively.

In addition, India has the lowest per capita emission of 1.9 metric tonnes and contributes to 7% of world pollution even when it makes up 17% of the world population. Realistically speaking, India has a higher chance of reaching the net-zero goal before the US, EU and China.

The progress in building renewable energy infrastructure looks promising. As per Invest India, over the past 5 years, solar capacity has increased from 6.7 GW to 40 GW in 2021. Wind capacity has also increased by 2.2 times since 2017.

India is all set to open the largest renewable energy park of 4750 MW in Gujarat. Besides, PM Narendra Modi’s upcoming plans to reduce India's coal dependency by not setting up any more coal energy plants and decarbonising Indian Railways by 2030 is a start in the right direction.

A challenge that lies ahead

The most obvious challenge for India is to secure climate finance. As a developing country, India depends on the developed countries to provide the finance for the formulation of new technologies and methods to reduce its coal dependency.

In the COP-26, PM Modi demanded the rich countries make 1 trillion USD available as soon as possible. Unfortunately, these countries already have many unmet promises regarding climate finance.

To conclude, the goal to become Net Zero will not be a cakewalk for any developing nation. However, it will become extremely challenging for developing countries to create groundbreaking technologies without the needed financial assistance.

Hence, the way forward to achieving the collective goal is for rich countries to take charge and lead the way. As they will be able to bear the heavy initial research & development costs, developed nations are more likely to create innovative decarbonisation technologies.

India will also have to change its energy infrastructure. Some strategies will even require lifestyle changes from its citizens. However, with strategizing and global support, India will surely complete its promises successfully.

Corporate Sustainability Reporting or CSR refers to a regulation and management system employed by companies to keep check of their environmental and social impact on the world. It is a yearly report made by companies to self-regulate their brand reputation through charitable, philanthropic and social activities. Although CSR is usually done by companies as an initiative of their own, many nations and organizations have made it mandatory for large scale companies to have a CSR model. It is also a way to make the stakeholders of the company and the general public aware of their yearly working system.

What are the benefits of CSR?

To have a long-term customer or client, a brand doesn’t need just a good product. It needs to show what it stands for, what values it represents. Here are some benefits to incorporating CSR into your company:

It helps the company to be more conscious of its social, economical and moral responsibility It improves a company’s reputation for its employees and potential recruits CSR limits the risk of scandals and mishaps in the environment. It enhances the perception of the general public, as people prefer to use products and services of a company which is environment conscious.

How to write a CSR report?

Without careful efforts, a CSR report can appear extremely dull and difficult to read. A well written CSR attracts investors, customers as well as potential employees. So here’s how to write an attractive CSR report:

• The report will be online, so use a directory or table of contents in the beginning for all subjects mentioned in the report
• Give an overview of your business, its operations and recent dealings
• An optimistic and warm letter from the CEO that adds a human element to the report
• Mention your goals for environmental sustainability
• Mention your progress towards said goals (use measurable numbers and percentages for more clarity)
• Add real life incidents, narratives or interviews to make the report more readable
• Mention what your priorities will be for the next term in regards to corporate social responsibility, how the company will tackle major issues
• Use detailed and easy to understand infographics and charts.
• If the report is large, make sure to add the sources from which the report is compiled.
• Add the contact details of every major person involved in the handling of mentioned issues.
• Have your report audited by a third party for better validation

What are some good examples of CSR?

Writing a CSR report can be daunting and exhausting, especially without inspiration. Here some excellent examples of CSR done flawlessly by corporate companies that we can learn from. (THIS PARANTHESIS IS NOT TO BE INCLUDED IN FINAL BLOG- THE LINKS ARE TO THE RESPECTIVE COMPANIES’ CSR REPORTS)

• Google: https://sustainability.google/in 2019, Google celebrated 13 years of Carbon neutrality. It is also the world’s largest annual corporate purchaser of renewable energy.
• Ford Motor Company: https://www.india.ford.com/about-ford/community/csr/#:~:text=Ford%20India%20lays%20particular%20importance,and%20pollution%20of%20water%20bodies the firm took a Sustainable Workforce initiative under which they improved employees’ health, efficiency and productivity. Its global safety standards have reduced workplace accidents by 90%.
• Bosch: https://www.bosch.in/our-company/our-responsibility/corporate-social-responsibility/during the early Covid-19 outbreak, Bosch India pledged more than 50 crore rupees for pandemic relief efforts. 9 lakh masks were donated to second level Covid-19 warriors.
• Lego: https://www.lego.com/en-us/sustainability the firm has pledged to go completely carbon neutral by 2022. The toy company has also announced that they will replace from plastic packaging their toys to paper packaging.
• Ben & Jerry’s: https://www.benjerry.com/whats-new/2014/corporate-social-responsibility-history the ice-cream company donates 7.5% of their pretax earnings to social causes since 1985. It has remained one of the few brands that have consistently spoken out and taken action against acts of injustice around the world.

While CSR report can look different for every company, its objective is the same throughout- to be more sustainable, ethical and responsible. To do well not just for the brand, but also the environment. Companies that stick with yearly CSR reports usually tend to see profits in all areas. Socially responsible companies tend to focus on the approach called Triple Bottom Line. Here, three areas are taken into consideration- Profit, People and Planet. ‘Do well by doing good’ is their motto.

So if your company is not legally required to do CSR, it is still wise not to wait. CSR sets a standard for your company among your competitors. Committing to CSR is a step in the right direction, not just for your brand, but for everyone involved.