Clothing brands around the world have started paying attention to the climate crisis conversation, and soon, thanks to a small nonprofit, they'll have a new way to showcase their commitment on store shelves. San Francisco-based Climate Neutral is unveiling a Climate Neutral Certified label in April that will identify companies that have reached a net-zero carbon footprint by reducing and offsetting emissions released through their entire creation process, from design to production to shipping.
"I want it to be the norm that companies expect they should pay money if they're going to emit carbon in their business, which they all are," says Peter Dering, the nonprofit's co-founder.
Dering is also the founder and CEO of Peak Design, maker of everyday bags and camera gear. The 36-year-old always kept an eye on his 10-year-old company's environmental impact, but as Peak Design grew (he says it'll likely approach $100 million in revenue this year), Dering understood he had "a moral imperative" to take more focused action. During a manufacturing trip to Vietnam in 2018 he was directly confronted with the business's eco challenges as he stared at a month's worth of materials stacked against a wall.
"I knew [it took] a lot of carbon to transform those materials, but I had zero idea what Peak Design's carbon footprint was," Dering realized.
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He returned home, hired a consulting firm to help measure that footprint, and was shocked to discover that it would cost only $60,000 to offset the company's 20,000 tons of emissions in 2017 — just one-fifth of one percent of the company's revenue at the time.
"This is true for every company in the world: The amount of money we're talking about to do the work to mitigate carbon is pennies on the dollar," he says. "The fact that every company in the world doesn't, as a bare minimum for responsibility, offset their carbon almost became inconceivable."
In February 2019, Dering and Jonathan Cedar, CEO of BioLite, which produces light and heat products that rely on sources like the sun for energy, launched Climate Neutral to encourage more brands to take responsibility for Mother Earth. More than 130 businesses across a variety of industries have already committed, including Boyish Jeans, Allbirds, and Avocado (which is already sporting its certified label); they're in various stages of certification now.
Brands start by measuring their carbon output using a simplified emissions estimator based on the Greenhouse Gas Protocol. Climate Neutral verifies the numbers and reviews emissions reduction action plans, which are required of all companies. Then the business purchases carbon credits — verified through organizations such as Gold Standard — either through Climate Neutral or on their own. Once all those boxes are checked, brands can display an official Climate Neutral Certified label.
Carbon offsets — the process of counteracting one's own greenhouse gas emissions by paying someone else to capture or avoid emitting the same amount elsewhere — have not always been well-received. Critics focus on three key concerns: It's difficult to accurately measure carbon emissions and the amount of carbon saved; the industry is unregulated and thus unreliable; and buying offsets could relieve companies from actually doing the tougher work of reducing their emissions.
Still, they're popular. A recent National Geographic article noted that vendor Cool Effect saw a 700 percent increase in individual purchases of its offsets during the second half of last year.
Elizabeth Sturcken is the managing director of EDF+Business, an arm of the Environmental Defense Fund that teams up with companies to uncover solutions to environmental issues. She agrees that high-quality offsets "can be a totally legitimate and meaningful way to reduce climate emissions right now." But she encourages businesses to focus on other steps first.
"There's a lot the fashion industry can do that's within its own control," she says. "The company needs to do everything it can within its own operations and supply chain to reduce emissions, and it needs to engage in policy to try and get the policy changes so that everyone is forced to do that before it purchases offsets."
To experts, purchasing offsets is just one piece of the climate solution.
"We need broader, longer term policy change from governments," says Peter Miller, the director for the Natural Resources Defense Council's Western region climate and clean energy program. "But companies can do a lot. They can take a look at their own activities and do what they can to reduce emissions and offset those that remain."
Ultimately, he says, "while offsets can be an important and valuable part of that effort, it's only a part… It's not a bad place to start, but it's not a good place to end."
Dering agrees, but he views offsets as a necessary tool — and a jump-start to incorporating other sustainable changes.
"When you agree to buy carbon offsets for the carbon you produce, for the first time in the history of your company, you're incentivized to create a smaller carbon footprint because you're committing to pay for any carbon you produce," he says. "It is the fundamental change that businesses need to take on if we're going to tackle carbon. That change is taking responsibility for carbon as opposed to the status quo forever."
Climate Neutral Certified brands do have to commit to reduction plans as well. Peak Design, for example, is switching from using virgin aluminum to recycled aluminum, which, according to Dering, is about five times less carbon-intensive. Others are implementing strategies such as switching to renewable energy sources, offering telecommuting and upgrading to smart thermostats in retail stores.
Boyish Jeans founder Jordan Nodarse says the company reached carbon neutral status before joining Climate Neutral, but he wanted to help promote this process and how easy it can be to others.
"[Climate Neutral] made the measuring way easier for me," he says. "Instead of people figuring out all this [stuff themselves], there's a company helping and guiding them to do things the right way."
This year, Nodarse expects to spend approximately $40,000 on carbon offsets and eco-focused donations, which amounts to around one percent of Boyish's revenue. The women's denim line also publishes an annual sustainability report, highlighting efforts like recycling their cutting waste, reducing water use and auditing all of their partner factories.
"Carbon offsets are pretty much the entry point into doing better," he says.