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Aerial view of a path through a tree reforestation project
From Pivot Magazine

Carbon neutrality is here to stay and we can all reap the benefits

Once an ambitious goal, it’s now the standard expected by investors, regulators and the public

Aerial view of a path through a tree reforestation projectCarbon neutrality can be achieved through carbon offsetting programs such as reforestation initiatives (Getty/Richard Newstead)

Carbon neutrality refers to the balance between greenhouse gas emissions and removals from the atmosphere. For a business, this means removing more carbon from the atmosphere than it is emitting, resulting in the now-familiar net zero concept. This balance can be achieved through different methods like reducing emissions, using renewable energy sources or carbon offsetting programs like reforestation initiatives.

First introduced in the late 1990s as part of efforts to mitigate what was then called “global warming,” carbon neutrality became a corporate imperative after the release of the 2006 documentary An Inconvenient Truth.

It's been having a moment ever since. Carbon neutrality is now viewed as a baseline objective for responsible companies, and businesses that fail to take action to reduce their carbon emissions open themselves to vocal criticism from both consumers and investors. Aside from burnishing their reputation, businesses that embrace carbon neutrality can actually find themselves with reduced operating costs.

In some cases, however, carbon neutrality can be expensive and challenging to achieve, and carbon offsetting projects may not always be effective or sustainable because they can fail to address the root causes of a company’s carbon emissions.

And, as governments and regulatory bodies implement stricter environmental regulations and carbon pricing mechanisms, companies will proactively pursue carbon neutrality to reduce financial penalties and ensure compliance with evolving sustainability standards. Although Canada appears to be lagging behind when it comes to such standards. A report by Principles for Responsible Investment ranked the country as a “low-regulation jurisdiction” by international standards, citing a lack of action by policy makers to encourage responsible environmental practices.

Despite the prevalence of carbon neutrality within the corporate lexicon, it’s still just one part of a broader strategy to reduce greenhouse gas emissions. It’s one of many sustainability practices that businesses need to keep front of mind because their consumers and stakeholders surely will.


Read about CPA Canada’s commitment to reducing greenhouse gas emissions by 40 per cent by 2030. And download a free report on why Canada’s largest cities are shifting to carbon neutral societies.