Tree planting or obtaining carbon credits from afforestation is a way to mitigate environmental impacts caused by companies; learn what they are and how to achieve them in this article.
Between 1970 and 2019, natural disasters accounted for 50% of all reported incidents of this kind, totaling 45% of recorded deaths and 74% of economic losses. These data come from a report developed by the World Meteorological Organization (WMO).
You can check the main events here. Unfortunately, there is a tendency for these occurrences to become even more common.
“Record annual temperatures, increasing natural disasters, and declining biodiversity present urgent warning signs for the longevity of humanity on Earth. Global warming, which undeniably has human influence, will surpass 1.5 °C before the middle of the century,” states a report from the International Chamber of Commerce Brazil (ICC).
One way to prevent this is for companies and countries to seek ways to mitigate their environmental impacts through carbon credits. Carbon offsetting allows companies to compensate for their activities, depending on their industry, size, and other criteria.
But what are carbon credits?
To better understand, we must return in time, specifically to 1997 when the Kyoto Protocol was signed.
With 180 signatory countries, this document required countries to reduce their Greenhouse Gas (GHG) emissions to 5% below 1990 levels, aiming to combat global warming through carbon credits.
Despite being in effect for decades, the regulation of the carbon credits market happened only in 2021 at the United Nations Climate Change Conference (COP-26). A carbon credit is a digital certificate that proves a project has offset the emission of 1 ton of CO2 into the atmosphere.
This approach applies to various projects such as forest conservation, reforestation, clean energy, and biomass, among others. These assets assist organizations—and national governments—in demonstrating their efforts toward offsetting the pollution caused by GHGs.
Many organizations seek to achieve carbon certifications for various reasons, from public recognition of their impacts to enhancing their reputation, as we explained in this article. Private sector involvement contributes to the development of a low-carbon economy aligned with the environment’s new needs.
Brazil at the Vanguard
One of the most common and efficient ways to obtain carbon credits is through forest management projects such as reforestation, restoration, and Reducing Emissions from Deforestation and Forest Degradation (REDD).
The ICC states in a report that “reforestation is generally assessed as a better short-term mitigation option in the forestry sector due to its ease of implementation, provided an economic rationale supports it.”
Since greenhouse gas emissions (GHGs) mix globally in the atmosphere, companies can obtain carbon credits from initiatives carried out anywhere. According to the ICC, Brazil expects to be at the forefront of projects related to carbon credit acquisition, which could generate $100 billion by 2030, according to the organization’s estimate.
Due to its track record in sustainable economics, Brazil has the potential to meet between 5% and 37.5% of the total demand in the voluntary carbon credits market.
However, projects of this nature require specialized initiatives that can transparently demonstrate the work and results. It is not enough to plant trees; proper management is required, along with concerns for the entire ecosystem surrounding the forest and the tree’s life cycle.
