Carbon neutrality - Net Zero: definition, challenges, and best practices for organizations

1. Understanding carbon neutrality: a global goal

Since the Paris Agreement was adopted in 2015, carbon neutrality has become an essential goal for limiting global warming to below 2°C. In concrete terms, it refers to the balance between greenhouse gas (GHG) emissions generated by human activities and their sequestration by carbon sinks (forests, soils, capture technologies). The objective is simple to understand: emit as much carbon as we are able to absorb sustainably.

According to the IPCC, "carbon neutrality" and "net zero" mean the same thing.

Important: Carbon neutrality only makes sense on a global scale (or among countries coordinated under the Paris Agreement). A company, community, or product cannot, strictly speaking, be "carbon neutral." However, these actors can contribute to global carbon neutrality by reducing their emissions and financing sequestration or reduction projects elsewhere.

To regulate these practices, ISO 14068-1 sets out specific requirements. It prioritizes actions: absolute priority is given to direct and indirect emission reduction, followed by offsetting residual emissions through credible and transparent mechanisms (certified carbon credits, guarantees of origin, etc.).

Therefore, when a company communicates, it should not present itself as "neutral," but rather as a contributor to the global goal. This is a fundamental distinction that must be made in order to avoid confusion or accusations of greenwashing.

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2. Measuring your carbon footprint: the starting point for any strategy

Before taking action, you need to know where you stand. For an SME, the first step is to measure its carbon footprint using a greenhouse gas emissions assessment (GHG assessment or Bilan Carbone®). This carbon accounting is based on six categories (formerly known as scopes):

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• Category 1: Direct emissions (e.g., fuel used in company vehicles).
• Category 2: indirect emissions related to energy (e.g., electricity, heating).
• Category 3: indirect emissions associated with transportation
• Category 4: Indirect emissions associated with purchased products
• Category 5: Indirect emissions associated with products sold
• Category 6: Other indirect emissions

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Key takeaway: For a company, categories 3 to 6 often account for more than 70% of its total carbon footprint. Ignoring this would mean missing out on a complete picture of its impacts.

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3. Develop a credible low-carbon strategy

Once the carbon footprint has been measured, the most important step is to develop a low-carbon strategy. This strategy is based on three pillars:

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a) Reduce emissions at source

This is the top priority. Organizations must identify their main sources of emissions and define concrete action plans, for example:

• On the energy efficiency of buildings and equipment,
• Reducing business travel and promoting sustainable mobility,
• Responsible purchasing (low-emission raw materials, committed suppliers),
• The eco-design of products and services.
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b) Carbon sequestration

Even with an ambitious strategy, there will always be residual emissions. These are emissions that are necessary for business operations, such as commuting, digital footprints, employee meals, etc. These can be offset by sequestration, i.e., carbon storage:

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• Naturally, by protecting and restoring forests, soils, and ecosystems. These are carbon sinks.
• Technologically, through CO2 capture and storage (still costly and rarely used).

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Nature-based solutions are obviously preferable, as they offer significant co-benefits and are vital to the proper functioning of our planet (biodiversity, soil quality, adaptation to climate change).

c) Use carbon credits responsibly

Contributions can complement the approach, but they should never be the starting point. Financing reduction or sequestration projects elsewhere contributes to the collective effort, but only on condition that:

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• Internal emission reduction remains a priority.
• carbon credits are traceable, transparent, and of high quality,
• communication should be honest and accurate (never say "carbon neutral" but rather "contributes to global carbon neutrality").

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By avoiding the trap of "arithmetic" neutrality (I offset as much as I emit), organizations are building a credible and sustainable approach.

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4. Communicate effectively: the right language

A low-carbon strategy loses its value if communication about it is not rigorous and structured. Leaders must adopt transparent messages that comply with the recommendations of ADEME and ABC:

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To be avoided

• "My company is carbon neutral."
• "This product is carbon neutral."

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These statements are misleading because they imply that the activity has no impact on the climate. However, as we have seen previously, it is impossible for an organization to have zero emissions.

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To be preferred

• "Our emissions reduction strategy contributes to achieving global carbon neutrality by 2050."
• "This product has been designed to reduce its carbon footprint."
• "We offset our residual emissions by financing certified projects, in addition to an ambitious reduction policy."

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Best practices in communication

• Always prioritize actions: reduction first, contribution second.
• Promoting transparency: publishing a detailed report on the steps taken
• Linking the company's actions to collective goals (Paris Agreement, SNBC, Net Zero Initiative).

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Clear, rigorous communication that complies with standards prevents greenwashing and strengthens the company's credibility with its customers, investors, and employees.

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Conclusion

Carbon neutrality is above all a global goal that involves all countries and economic actors. For an organization, it is not a question of "becoming carbon neutral," but rather of drastically reducing its carbon footprint and contributing to this global goal through its choices and investments.

By measuring its emissions, defining a credible low-carbon strategy, and communicating transparently, an SME can simultaneously strengthen its competitiveness, meet the growing expectations of its stakeholders, and actively participate in the fight against climate change.

Source: ABC and ADEME Carbon neutrality | Communication guide | Carbon accounting
ADEME opinion - Carbon neutrality