With carbon insetting the CO2 compensation becomes part of the corporate value chain or compensates CO2 emissions within the production chain of a company. No existing climate protection projects at another location are supported as in carbon offsetting.
With carbon insetting, climate protection measures are implemented in the company’s own value chain. This process makes sense because most companies generate or purchase a high proportion of CO2 emissions in their supply chain. This is due to the production and transportation of suppliers. This action must be adapted to their own supply chain and must also be located and implemented directly in chain. In this context, measures are implemented which reduce rejects and waste during production or lower energy consumption. This approach is by far the most demanding, as many companies do not have the necessary resources to establish their own climate protection project in the value chain due to their size. A compromise is to use an existing mechanism with a direct link to their own supply chain.
A Panamanian chocolate manufacturer, Oro Moreno, is carrying out reforestation activities in addition to the cultivation of cocoa plants on its suppliers’ cocoa fields. This combination not only improves the economic basis of the farmers but also directly compensates the CO2 emissions within the production chain. Carbon Insetting thus pursues a holistic approach, which aims to address both the ecological and social challenges, such as the poverty of small farmers.