Carbon offsetting: strategic and standards based analysis to support corporate decision making

ContributorsBertsch, Jesswin
Number of pages60
Defense date2023-01-09

A growing number of companies are making commitments to reduce emissions and become carbon neutral. In addition to internal reductions, several companies are relying on offsetting to meet their commitments. In this context, and following the 2015 Paris Climate Agreements, the British petrochemical company INEOS has committed to achieving net zero emissions by 2050. INEOS is a global manufacturer of chemicals and oil products with applications, among others, in transport, medical devices, power transmission or renewable energy products. I had the opportunity to do a three-month internship at INEOS Group from March to May 2022 in Rolle, Switzerland, in the Climate and Energy Network of INEOS.

This research was carried out in collaboration with the company and my role as an intern was to develop a pathway forward and recommendations for a possible offsetting strategy adapted to the INEOS. To this end, I established several research questions including: what are the risks and opportunities for INEOS associated with carbon offsetting? What strategic approach should INEOS take in the market to minimize the risks? What types of projects and standards should INEOS focus on?

To address these, this thesis provides a detailed history and description of the current landscape of the voluntary carbon market, including a market analysis. As standards are essential for offsetting, a normative review of the main standards has been carried out. The company is strongly committed to sustainability and focuses on internal reductions and investments in low-carbon technologies. However, INEOS does not exclude the use of offsetting in the future to meet its commitments and intends to do so with the highest quality standards. To this end, this research provides an analysis of the risks and opportunities associated with the different strategic approaches and the different projects to be prioritized in order to provide clarity on good practice. In addition, it also provides a benchmark to illustrate the different approaches in the sector and among leading companies was carried out.

The results show that offsetting carries several financial and reputational risks. Moreover, the market is evolving, with changes in regulations and practices, following the establishment of various multi-stakeholders’ initiatives focused on quality and integrity.

These elements make it complicated to engage in offsetting at this time. The 2030 horizon seems more appropriate with a portfolio approach to a variety of projects and different sources of procurement, including retailers, market purchase and contract of delivery. It is important to follow code of good practice. Forestry, agriculture and soils, and biochar projects seem the most suitable and interesting in terms of risk and impact.

Citation (ISO format)
BERTSCH, Jesswin. Carbon offsetting: strategic and standards based analysis to support corporate decision making. 2023.
Main files (1)
Master thesis
  • PID : unige:176432

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