Carbon Neutral

What is Carbon Neutral?

Carbon neutrality — sometimes called climate neutrality — is the state in which an organisation's measured greenhouse gas emissions are balanced to zero through a combination of internal reductions and external compensation (offsetting). The concept has been formalised in the international standard PAS 2060, published by BSI, which sets out the requirements for demonstrating carbon neutrality.

Under PAS 2060, an organisation must: define the subject of the claim (the entity, product, or activity); measure its greenhouse gas footprint using a recognised methodology (typically the GHG Protocol); commit to reducing emissions over time through a carbon management plan; and offset any remaining emissions using verified carbon credits from recognised standards such as the Verified Carbon Standard (VCS), Gold Standard, or the UK Woodland Carbon Code.

The critical distinction between carbon neutral and net zero lies in the treatment of offsets and the requirement for actual reductions. Carbon neutrality permits an organisation to offset 100% of its emissions without necessarily reducing them — in theory, a company could maintain or increase its emissions and still claim carbon neutrality by purchasing enough offsets. Net zero, by contrast (as defined by the SBTi), requires at least a 90% reduction in actual emissions before any residual amount can be addressed through permanent carbon removals.

This distinction has led to increasing scrutiny of carbon neutral claims. Critics argue that relying heavily on offsets — particularly avoidance credits (e.g., avoided deforestation) rather than removal credits (e.g., direct air capture) — does not deliver real emission reductions. The EU has moved to ban generic "carbon neutral" claims in advertising under its Green Claims Directive, and the UK's Advertising Standards Authority (ASA) has tightened guidance on how such claims can be communicated.

Despite the criticism, carbon neutrality remains a meaningful step for organisations beginning their decarbonisation journey. It requires measurement, transparency, and financial commitment to climate outcomes. The key is to treat offsetting as a complement to genuine reduction efforts, not a substitute for them.

How Climatise Helps

Climatise provides the accurate emissions measurement that underpins any credible carbon neutrality claim. The platform calculates your complete footprint across all scopes, tracks reductions year-on-year, and quantifies the residual emissions that need to be offset — ensuring your carbon neutral claim is based on robust, auditable data.

Frequently Asked Questions