Carbon neutral, net zero, climate neutral, carbon negative, and similar

Considering that companies are increasingly asserting claims of being carbon neutral, net zero, climate neutral, carbon negative, and similar, it would be beneficial to incorporate a more comprehensive discussion on these topics within the lesson's text.

Here are some points that could enrich the discussion.

1. IPCC 

Carbon neutrality. See Net zero CO2 emissions

Net zero CO2 emissions. Net zero carbon dioxide (CO2) emissions are achieved when anthropogenic CO2 emissions are balanced globally by anthropogenic CO2 removals over a specified period. Net zero CO2 emissions are also referred to as carbon neutrality.

Net zero emissions. Net zero emissions are achieved when anthropogenic emissions of greenhouse gases to the atmosphere are balanced by anthropogenic removals over a specified period. Where multiple greenhouse gases are involved, the quantification of net zero emissions depends on the climate metric chosen to compare emissions of different gases (such as global warming potential, global temperature change potential, and others, as well as the chosen time horizon).

Therefore, carbon neutrality and net zero CO2 emissions are synonymous. However, this aspect is not addressed in the lesson's text.

Reference: https://www.ipcc.ch/site/assets/uploads/sites/2/2022/06/SR15_AnnexI.pdfLinks to an external site.

2. IFRS S1 & IFRS S2:

Neither IFRS S1 nor IFRS S2 make reference to "carbon neutral" or "net zero". It's noteworthy that IFRS S2 defines a climate-related transition plan as “An aspect of an entity’s overall strategy that lays out the entity’s targets, actions or resources for its transition towards a lower-carbon economy, including actions such as reducing its greenhouse gas emissions”. Hence, it doesn't necessitate achieving net zero.

TCFD (2021) says: “A specific type of transition planning that has gained attention recently focuses on achieving a net-zero target”.

3. SBTi (2024)

C14 – State of net-zero emissions: Companies shall set one or more targets to reach a state of net-zero emissions, which involves: (a) reducing scope 1, 2 and 3 emissions to zero or a residual level consistent with reaching net-zero emissions at the global or sector level in eligible 1.5°C scenarios or sector pathways and (b) neutralizing any residual emissions at the net-zero target date – and any GHG emissions released into the atmosphere thereafter.

Reference: https://sciencebasedtargets.org/resources/files/Net-Zero-Standard-Criteria.pdfLinks to an external site.

4. IFRS – Climate related commitments (IAS37)

https://www.ifrs.org/projects/work-plan/climate-related-commitments-ias-37/Links to an external site.

5. University of Oxford – Net Zero

https://netzeroclimate.org/what-is-net-zero-2/Links to an external site.

Net Zero made substantial contributions to the following website:

https://en.wikipedia.org/wiki/Net_zero_emissionsLinks to an external site.

“People often use the terms net zero emissions, carbon neutrality, and climate neutrality with the same meaning.   However in some cases, these terms have different meanings from each other. For example, some standards for carbon neutral certification allow a lot of carbon offsettingLinks to an external site.. But net zero standards require reducing emissions to more than 90% and then only offsetting the remaining 10% or less to fall in line with 1.5°C targets”.