How the Commission’s Directive on Green Claims affects the VCM

The VCM has been facing turmoil in the last couple of months. On the supply side, the methodologies used by most standards have been accused of overestimating emission reductions. On the demand side, criticisms regarding the transparency and scientific basis of “green claims” by companies have been made.

As recently reported by the New Climate Institute and Carbon Market Watch on the Corporate Climate Responsibility Monitor and later highlighted by Financial Times, the Net Zero claims set by major corporations are accused of failing, being vague, misleading, or unfounded. These critiques highlight the need for a clearer understanding of the current landscape for corporate environmental claims and their associated risks.

Last Wednesday (Mar 22), the European Commission launched the Proposal for a Directive on Green Claims, establishing clearer guidelines for corporate claims with the aim of avoiding the risks of greenwashing. This article will analyze the impact of the legislation on the voluntary carbon market.