Why your company probably shouldn’t call itself ‘climate positive’

Seven years ago, when H&M said that it planned to make its supply chain “climate positive” by 2040, it was one of the first companies to set that goal. Others followed, from Ikea to Intuit. But H&M is now one of the first to question the target and reject it.

Climate positive means that a company is responsible for removing more CO2 from the atmosphere than it emits, by relying in part on extra carbon credits. But the details of how that works are vague, H&M says. “Today, there is no consensus around climate positive, leaving it pretty much up to each company’s interpretation,” says Henrik Sundberg, the climate impact lead for H&M Group.

Instead, the clothing giant now has a goal to reduce its direct emissions by at least 90% over the next 16 years, and to use carbon credits to cover no more than 10% of its footprint. That’s in line with the net zero guidelines from the Science Based Targets Initiative (STBI), an organization that helps companies set emissions goals.

Without a standard definition for climate positive, a company might only directly reduce emissions by a small percentage, using carbon offsets to do most of the work as it continues to pollute. The same problem exists for net zero goals; though more than 1,000 large companies have said they plan to reach net zero, only a small fraction have set targets in line with SBTI’s criteria of cutting emissions by at least 90%.

Max Burger, a Swedish restaurant chain, started calling its burgers climate positive in 2018, when it began buying carbon offsets to cover 110% of its carbon footprint. (The plan won it praise from both the United Nations and Fast Company.) But a 2023 case study argues that the approach helps justify business as usual. Earlier, the restaurant had pioneered a menu that listed the carbon footprint of each item, nudging customers to choose plant-based options. After everything on the menu was dubbed “climate positive,” there was likely less incentive for customers to avoid beef. The company is aiming to cut emissions by around 75% by 2050, in line with SBTI’s guidance for food companies. But it’s making the claim of being climate positive now, before all of those cuts have happened.

The restaurant chain says it has already reduced its emissions per calorie by about 30%, because more customers are ordering plant-based burgers. (The switch was happening more quickly, however, before the company branded itself as climate positive.) It also says that it’s more important to act quickly than wait for consensus on what “climate positive” means. “A shared definition would be great, and we have done our part to try to make that happen, but it seems to take forever to get there while record temperatures keep pummeling the planet,” says Kaj Török, chief reputation officer and chief sustainability officer for Max Burger. Török says that the company doesn’t want to wait to support carbon offsets, since carbon removal work is needed now, and that its emissions reductions are on track with the Paris climate goal.

But it can be misleading, arguably, for companies to make claims of being climate positive before they’ve made large emissions cuts in both their operations and supply chain. Those deep cuts are the most important step, experts say. “In some circumstances, there is a risk that offsetting can distract from this key objective, relieving the pressure on companies to act and reduce [their] own emissions,” says Thomas Day, who analyzes corporate climate commitments at the nonprofit NewClimate Institute. “Companies may be tempted to skip the first steps of the mitigation hierarchy since offsetting is frequently understood as the most convenient and cheapest option to claim a reduction of emissions.”

Offsets aren’t truly equivalent to directly reducing emissions: Burning fossil fuels, and adding CO2 to the atmosphere that will last for centuries, can’t be perfectly balanced by planting trees that may later burn down in wildfires, for example (even if you try to carefully account for everything that might happen). Some carbon credit projects have overstated their benefits or are difficult to measure. And relying heavily on carbon credits can’t scale up. Oxfam calculated in 2021 that corporate plans for carbon removal, at that point, would require an area of land five times larger than India, or roughly the size of all global farmland.

That’s not to say that companies shouldn’t support forest restoration, direct air capture of CO2, and other offset projects. On a global level, carbon removal is absolutely necessary to avoid the worst impacts of climate change. But some climate researchers argue that it shouldn’t happen as part of a net zero or carbon positive claim. A company could have separate goals for its direct emissions cuts and for carbon removal.

Other companies with climate positive goals also lean on carbon credits. Microsoft has a goal to become “carbon negative” rather than climate positive, but it’s the same concept—the aim is to remove more carbon than it emits, by the end of this decade. It plans to cut emissions in half by that point—in line with what the Paris agreement says needs to happen globally—and support carbon removal projects to offset the rest. (By 2050, it plans to go a step further and remove the equivalent of all of its historical emissions since the company was founded.)

IKEA is working aggressively to cut its emissions, including through innovative work to repair and resell its products. Still, when the company set a goal in 2018 to become climate positive by 2030, the plan initially only included 15% cuts in emissions in its value chain. Now, the company has net zero goals aligned with SBTI—by 2030, it aims to cut emissions in its value chain by 50%, and then plans to reach 90% cuts by 2050. “We are currently reviewing our climate narrative, including the term ‘climate positive,’ in line with our strengthened climate goals,” an IKEA spokesperson said.

Henkel, a German chemical and consumer goods giant, is aiming to become climate positive in its production—a relatively small part of its total carbon footprint—by supplying surplus energy to other companies, rather than using offsets. It plans to cut its emissions directly by 65% in its production as part of the goal. With companies defining climate positive in different ways, it’s hard for consumers to understand what it actually means.

In the European Union, a new law that goes into effect in 2026 will ban companies from claiming to be “climate positive” if they’re relying on offsets. They’ll only be able use the phrase if they’re making all of the changes within their own value chain. It doesn’t mean that companies can’t advertise their support of carbon removal projects, but it can’t be used to make claims about improving the company’s own carbon footprint. (The law, designed to crack down on greenwashing, also requires companies to provide evidence for other claims like “biodegradable” or “energy efficient.”)

Any climate pledge that companies make should be clear, says NewClimate’s Day. “Transparency is key,” he says. “Companies that make public climate pledges have a responsibility to transparently disclose the information that can back up those declared ambitions.” Right now, information is often missing, and even companies that are climate leaders sometimes exaggerate their claims. “Target setting and offsetting claims, especially, should be far more transparent,” he says. “Companies could reformulate their headline pledges to specific and unambiguous emission reduction targets that are not reliant on offsetting or neutralization of emissions.”

The basic concept of a climate positive goal makes sense: while taking care of their own emissions, ethical companies could go a step farther to support extra climate action with well-vetted carbon removal projects. Companies that lead on climate action “are going to have to do more than their fair share,” says Eliot Metzger, director of sustainable business and innovation at the nonprofit WRI. But any “climate positive” plan needs to be set up in a way to make sure it’s actually benefitting the climate. And it’s still up for debate whether it’s a good idea to use the phrase when a company is early in the process of cutting its own emissions. It might make more sense just to explain, in plain language, what the company is doing to decarbonize.