The LVMH Group is holding an exceptional online event for all its employees worldwide from December 8-11: LVMH Climate Week. On Thursday, December 10, the second Hot Topic round table on the climate emergency posed the question: Carbon offsetting: real change or greenwashing? Five experts shared their views regarding this novel approach to achieving carbon neutrality, considering whether it can offer a solution to climate change.
Many groups, especially in the fashion industry, believe they can achieve carbon neutrality in the short term through carbon offsetting. This practice compensates for the carbon emitted in one place by storing it elsewhere in other natural ecosystems. But is this really a solution to climate change?
LVMH has begun to look more closely at this practice within the framework of its carbon accounting. Having achieved its target of a 25% reduction in CO2 emissions due to energy consumption by sites and stores by 2020, LVMH has decided to go further and set even more ambitious objectives by focusing efforts on emissions that do not come directly from manufacturing, but from other links in the product lifecycle – sourcing of raw materials, transport to stores or customers, product use, etc.
For the second Hot Topic panel discussion during LVMH Climate Week, prominent experts were invited to exchange views and take a closer look at carbon offsets and the controversy surrounding this practice:
- Muriel Barneoud, CSR Director of La Poste Group.
- Marie-Thérèse Bonneau, President of the France Carbon Agri Association.
- César Dugast, Senior Consultant at Carbone 4 and head of the Carbon Neutrality practices at the consulting firm.
- Benoît Leguet, Managing Director of the think tank I4CE – Institute for Climate Change Economics.
- Arnaud Leroy, Chairman of ADEME, the French Environment and Energy Management Agency.
Panel members were asked to share their assessment of the levers available to reduce Scope 3 greenhouse gas emissions, which includes sourcing, transport, product use and end-of-life.
To respect the trajectory set by the Paris Agreement five years ago aimed at stabilizing global warming at under 2°C, greenhouse gas emissions must be brought to zero by the end of the 21st century. As the world leader in luxury, LVMH thus has a major role to play by making business recovery plans consistent with climate imperatives.
Carbon neutrality is currently a top priority for businesses. To start with, inaction on addressing climate change is costly to all actors in the economy. It can harm a company’s corporate image, especially among customers and investors, resulting in a potential loss of market share, as well as among recent graduates who seek meaning in their work when choosing a professional career.
To be effective, carbon offsets must be based on a combination of global neutrality, and carbon neutrality for the business. This means that companies should place priority on reducing their GHG emission across scopes 1, 2 and 3. Groupe La Poste has been working for the past decade to transition its entire fleet to electric vehicles and aims to help other entities reduce their emissions as well. This includes financing for projects and an offer of low-carbon products and services, as well as contributing to an increase in carbon sinks, meaning the ability of the planet to sequester carbon by injections in wetlands, for example.
In the near term, carbon offsets seem to offer a way to accelerate the trajectory to carbon neutrality on a global level. However, if this strategy for mitigating climate risk is to be effective, it must become more professionally managed. Carbon offsets should come at the end of the chain, once the company has already done everything in its power to significantly reduce its CO2 emissions. Given its position as the world leader in luxury, LVMH can play a key role in standardizing this practice.
Next up on the LVMH Climate Week agenda is the third Hot Topic on December 11: Can the Fashion Industry Ever Be Sustainable? The round table brings together the largest ever panel of fashion designers and experts to examine this compelling question.