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This week, BrewDog announced that it will relinquish its carbon-negative status and withdraw from the carbon credits market.

The UK-based brewery released an interim sustainability progress update this week, detailing why it has chosen to withdraw its carbon-negative strategy and cease the ‘outsourcing’ of its carbon responsibilities.

National media outlets have criticised BrewDog for relinquishing its carbon-negative status and withdrawing from the carbon credits market, arguing that the company is failing to uphold its ethical commitments, with industry insiders labelling the move as indicative of a lack of moral responsibility.

However, BrewDog's move underscores a critical and wider issue surrounding the effectiveness and credibility of carbon offsetting schemes, as well as the importance of honesty and accountability in sustainability strategies.

Why this matters 🌳

Carbon credits are purchased through schemes that allow companies to offset their greenhouse gas emissions, typically by funding activities such as tree planting, deforestation prevention and peatland restoration.

In its recent sustainability report, BrewDog said it was ‘proud to become the first carbon-negative beer company’ in 2020 through a ‘relentless focus’ on reducing emissions across the business and offsetting the rest through ‘high quality’ carbon credits.

However, the beer company believes the market has now become unsustainable in the face of exponential growth as companies increasingly look to offset their emissions, resulting in a ‘flood of dirt cheap schemes’ where the carbon benefit is ‘highly questionable, maybe even non-existent’.

The report reads: "At the same time, the number of high-quality, properly verified schemes has dwindled and the costs have gone through the roof".

"In fact, the cost is now so astronomical that the only way for BrewDog to sustain a carbon-negative claim is at the expense of our own sustainability initiatives. That would be crazy. It would be like cutting out fruit and veg so you can afford to buy vitamin supplements."

After November, BrewDog’s carbon-negative certification offered by business sustainability advisory Positive Planet will be revoked and the brewer said it will begin to wind down its carbon-negative messaging on products and in bars over the coming months.

The company said it will not invest in low-quality schemes and plans to ‘double down’ on its emissions reduction strategy, as well as boost investment in its Lost Forest initiative.

The Lost Forest project in the Highlands of Scotland saw BrewDog plant 438,950 trees in partnership with Scottish Woodlands last year.

However, an estimated 50% of these saplings did not survive their first 12 months, a failure rate the company’s then CEO James Watt attributed to ‘extreme weather conditions’ during the hottest Scottish summer on record, followed by a ‘harsh’ winter.

Union Hospitality, the workers representative association for the hospitality industry in the UK, described BrewDog’s latest announcement as a "failed promise from a company that has based its entire brand on being ethical".

This follows a national petition launched by the union in January, urging BrewDog to reverse its decision to withdraw the Real Living Wage for its bar employees.

FoodBev has reached out to Union Hospitality for further comment.

Voluntary carbon offsets: A net-zero negative?

While BrewDog’s decision has faced criticism, questions have been raised in recent years about the value of carbon offsetting schemes.

Climate experts have expressed concern that companies may be using offsetting as a form of ‘greenwashing,’ emphasising their efforts in areas such as tree planting to distract consumers from a lack of work being done to directly reduce their emissions output across business operations.

A 2022 report from the Climate Change Committee (CCC) states that an over-reliance on voluntary carbon offsetting schemes is ‘undermining’ the UK’s economy-wide net zero transition.

While the global market for voluntary carbon offsets has seen rapid growth, the CCC has reviewed the evidence on these schemes’ impact and found that they often deliver fewer benefits than claimed while pushing out other environmental objectives.

Chris Stark, chief executive of the CCC, said: “Businesses want to do the right thing and it’s heartening to see so many firms aiming for early net zero dates. But poor-quality offsets are crowding out high-integrity ones. Businesses face confusion over the right approach to take.”

The CCC said that while voluntary carbon markets can play a positive and complementary role in the contribution to net zero, the government must work to improve the standards of such schemes in the UK, as well as provide a clear and reliable definition of what it means to be a truly ‘net zero’ business and encouraging businesses to cut their own emissions as a priority before turning to offsets.

For example, a business could be considered ‘net zero’ when it has reduced its emissions to zero or as close to zero as possible, then permanently removed carbon dioxide from the atmosphere to compensate for remaining emissions.

If a business is reducing its emissions and using carbon credits to offset the remainder, it is recommended to use standardised terms like 'offset zero' or 'on the pathway to net zero' for clarity.

“There is a clear need for government to make standards stronger and point businesses towards an approach that prioritises real emissions reduction ahead of offsetting,” Stark said. “Those businesses that choose to support the economy-wide transition to net zero should get the credit they deserve.”

Evidence-based approach 🕵️

Mike Berners-Lee, founder and director of sustainability consultancy Small World Consulting, acted as scientific advisor to BrewDog and believes that offsetting is 'not useful,' echoing the CCC’s findings with his view that there is “no substitute for cutting total emissions in line with the best scientific evidence”.

He told FoodBev: “Whilst we advise that offsetting is not a useful concept, companies giving to good causes can be a good thing, as long as it's not used to greenwash a company’s reputation”.

“Seen in this light, we recommend that if companies who are already taking strong action on the nature of their goods and services and reducing the impact of their production, further want to donate money to organisations that push for a sustainable future, then they should look very carefully at the causes that can have the highest leverage over the systemic change that we think is required for humanity to thrive going forwards.”

He gives the example of donating to organisations that push for higher standards of honesty in politics, media and business, or that fight environmental legal cases – actions Small World is encouraging as an alternative to voluntary offset schemes.

“These are critically important, often lack relatively small financial sums and stand to have higher leverage over the global climate response than some of the carefully assessed carbon removal projects that we helped our clients select some years ago,” Berners-Lee emphasised.

“We support our clients with evidence-based advice at all stages of their sustainability journey. We're happy that our long-standing relationship with BrewDog continues for as long as they are sincere in their ambition to transition to be a truly sustainable business.”

Top image: © BrewDog

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