Former Secretary of State for Energy and Climate Change The Rt Hon Amber Rudd was joined by Carbon Gap’s Eli Mitchell-Larson and Pinwheel’s Rob Cheesewright on Thursday (23rd March 2023) to discuss the need and opportunities for corporate funding of climate and nature action. Here are some of the highlights of that lively conversation and if you would like to listen to the full one-hour discussion click here.
Only 16% of global climate funding needs are currently being met (Boston Consulting Group, November 2022). To achieve net zero, public and private sector entities across the globe will need approximately $3.8 trillion in annual investment flows through 2025.
The predominant strategy of carbon offsetting:
Creates an artificially low-price anchor (as low as $5/tCo2e) versus a true cost of carbon of $200tCo2e.
Contributes to a misallocation of capital towards less effective carbon avoidance/reduction projects, and often bypasses biodiversity-focused initiatives entirely.
Creates a risk to brands investing in such projects to claim carbon neutrality and misses opportunities for businesses to leverage activity to drive brand value by meaningfully engaging employees, consumers and stakeholders.
The ‘polluter pays’ principle encourages under-investment from many industry sectors with relatively low carbon emissions. Calculating appropriate investment by looking at profitability per tCo2e can provide a more meaningful investment guide.
Organisations such as Microsoft, Stripe and Klarna have set $100/tCo2e benchmarks, which align more closely to governments’ estimates of the true cost of carbon emissions at c$200/tCo2e.
Mixed project portfolios are lower risk and higher impact. For example, a portfolio comprised of nature-based quality carbon removal, early funding of vanguard carbon removal with long-term sequestration, and biodiversity protection/restoration.
Adopting a contribution approach rather than seeking to claim that carbon has been entirely compensated is a progressive strategy.
At Pinwheel we have a mixed portfolio of high-quality projects across: nature-based carbon removal, nascent carbon removal with long-term sequestration projects, biodiversity restoration initiatives, and waste reduction - across every continent. We assemble bespoke project portfolios based on specific client business requirements across industry, locality, customer/employee focus. The Pinwheel platform allows businesses to activate their employees and customers in the deployment of climate and biodiversity funding, thus building brand value and delivering ROI for the business. Book a demo of the Pinwheel platform with Katy Talikowska, chief growth officer, katy@pinwheel.co.uk.
