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Two innovative new offerings provide forward-thinking companies an engaging way to not only compensate for their product emissions, but to engage with their customers around climate action in a new way.
Our economic system is fraught with externalities. The production of goods and
services comes at the expense of the natural environment and to communities, yet
they are not taken into account in today’s marketplace.
The climate crisis has helped make people aware of this discrepancy. Today, more
and more consumers are concerned about the impact of their consumption of goods
and services, and it’s motivating them to seek out options that address these
shortfalls. The good news is, some companies are taking action to make it
According to Shelton Group, 63 percent of US
consumers say that a company’s environmental performance impacts their
purchasing choices; and 25 percent can name a brand they have purchased from
because of the company’s environmental
According to Forbes, 88 percent of consumers want brands to help them live
Now that we have a US administration making climate change a top priority and
businesses committing to ambitious net-zero
the moment is right for companies to respond to this
Consumers have more power than they realize. Their purchasing decisions and
ability to influence one another can directly impact the fate of most
and our environment. Should they choose to, businesses can address those
concerns directly through their products, their operations, their physical
infrastructure and supply chain — and by committing to climate-supporting
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Beyond product design and innovation, new options have emerged that allow both
businesses and shoppers to support climate
at either end of retail transactions — known as Climate Neutral Checkout and
Climate Neutral Products.
Concerned consumers may want to offset their own impact when purchasing a
product for which there is no climate-neutral option. Similarly, a company may
prefer to pass the cost of climate neutrality on to customers. That's where
comes in — it allows consumers to "make every purchase a climate action."
A Climate Neutral Checkout process has several components. First, the retailer
needs to access data on the carbon footprint of every item it sells. This
information is presented to the consumer at the time of checkout, with an option
to offset that footprint. Next, the retailer provides a set of verified
to which funds can be directed to effectively offset the impact of the purchased
product. Both the retailer and the consumer will, of course, want assurance that
the diverted dollars are getting to where they need to go and having the desired
One example is houseof, a UK lighting company, which
was born out of a desire to end “throw-away” culture. Co-founder Helen White
remarked, “houseof has purpose at the core of its product design and brand
values — we wanted to ensure purpose ran through all areas of our business, and
decided to take climate action by offering a climate-neutral checkout for our
Besides taking the usual steps to make its products as sustainable as possible,
houseof takes its sense of purpose a step further at the point of sale: “We saw
an increasing demand from customers looking for higher standards of
sustainability in the products they buy for their home,” White said. “To empower
our customers to take climate action, we worked with South
Pole to measure
the carbon footprint of all our lighting products, including their future usage.
Our customers are now given the opportunity to offset the usage emissions of the
product they buy — calculated by the corresponding tCO2e at checkout.”
In Switzerland, research found that one in three
want to understand the CO2 emissions of their own online purchases and offset
them directly at point of purchase. Young people under the age of 30, in
particular, are more conscious consumers. Swiss online market leader Digitec
Galaxus recognized this interest and took it as a mandate to inform consumers,
create transparency around its products, and offer the possibility of combining
online shopping with a contribution to climate-protection projects.
Digitec Galaxus sought a solution that would inform customers and prompt them to
think more critically about their shopping choices. “Our goal was to give
customers the opportunity to compensate for their online purchases,” says CEO
Florian Teuteberg. Data transparency was the top priority.
Climate Neutral Checkout therefore provides the customer with the choice to make
his or her purchase a climate neutral one, and it also gives retailers an
opportunity to distinguish themselves. Of course, not every product being sold
by retailers will have this option available, but those that can will be
indicated during checkout. While this is a new opportunity, we expect to see it
catching on among shoppers, particularly among those who want to do all they can
to reduce their own personal impact, and who recognize the key role that their
purchases play in determining our collective climate future.
Some companies prefer to take the offsetting responsibility out of the hands of
customers and make their products climate neutral to begin with. There are a
small but growing number of
products coming to market. Most of
these focus on the impact of
raw materials needed to make goods, by incorporating a high proportion of
sustainably harvested bio-based materials. Such products go through rigorous
certification protocols to determine the validity of their efforts. In
particularly innovative cases, they may be made from carbon pulled directly
But the vast majority of producers do not yet have the ability to produce their
products in a climate-neutral way, or they are not able to put enough
climate-neutral content into their products to offset the product’s overall
These companies can offer customers a different path to climate neutrality by
building it into the price of goods. This is done through a multi-step process:
First, the full carbon footprint of the product is calculated by means of a
life-cycle assessment that examines all inputs and outputs. Next, opportunities
to reduce the carbon footprint are identified by analyzing the current or future
product's design, manufacturing process, materials, supply chain and
transportation strategy. Using these tools to refine the offering, the product
footprint is assessed; and any remaining gaps can be addressed by supporting
quality carbon-reduction projects outside the company through offsets, which are
then built into the price at point of sale.
According to Bram Veenhof, Director of Climate Neutral
at South Pole: “This provides a path for manufacturers to bring a product to
market that can be considered climate neutral. Companies then have a formula
that they can periodically revisit as new developments enable increasingly
smaller footprints in the product or its supply chain. The end result is a
product that, if it meets a set of rigorous standards, can be certified as
Either of these two approaches offers companies an engaging way to not only
compensate for their product emissions but to engage with customers in a new
Published Apr 5, 2021 2pm EDT / 11am PDT / 7pm BST / 8pm CEST
This article, produced in cooperation with the Sustainable Brands editorial team, has been paid for by one of our sponsors.