Mitigation hierarchy framework
In my discussions with colleagues and external stakeholders, I always try to frame the discussion through what is known as the mitigation hierarchy framework. In simplified terms, it means companies should start by doing everything they can to reduce their own fossil scope 1 and 2 emissions, and in parallel collaborate to reduce emissions in their value chain, before turning to carboncredits based on removal actions carried out outside of their own value chain.
What are carbon removals and carbon credits?
Carbon removals are deliberate human actions to take CO2 out of the atmosphere and store it durably for the long term. These methods can be either nature-based, like planting trees, or technological, like capturing biogenic CO2 from industrial flue gases or CO2 directly from the atmosphere. Carbon removals can be utilized to create carbon credits which are traded on the voluntary carbon market.
Carbon removals need to be real, additional , and long-lasting. Most importantly, credits based on removals need to be verified by a credible certification system. The European Commission is developing its own certification system for carbon removals through the Carbon Removals and Carbon Farming Regulation. There are also several existing global certification schemes aiming to bring to market good-quality carbon credits, such as Gold Standard and Verra’s Verified Carbon Standard.
Detailed and common international rules on how different types of carbon credits can be utilised in an organisation’s carbon accounting are still under development. Guidelines will be given in several upcoming policy documents, such as the EU Green Claims Directive, for example, and standards like the Science-based targets initiative (SBTi).
Transparency as a foundation for credibility
Our primary focus at Metsä Board has consistently been on reducing fossil emissions, especially in our own operations. In our recently published climate transition plan, we’ve communicated targets that include eliminating fossil-based Scope 1 and 2 CO₂ emissions by 2030.
As part of our long-term sustainability work, we are closely monitoring the development of carbon credit systems and the evolving regulations around them. But the principles of the mitigation hierarchy remain and are well established: companies must prioritise reducing emissions in their own operations and value chains first, with carbon credits considered only as a last resort.
All in all, it’s going to be essential for companies, their management, and board members to see the bigger picture. Achieving climate neutrality will require many tools, but in a rapidly changing regulatory landscape, credibility will only come from using them in the right order and with complete transparency.
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