Alphabet (Google parent company), Disney, Delta Air Lines. These are all companies that have purchased carbon credits to reach their net-zero carbon targets.
Patrick Flynn, Senior Vice President of Sustainability at Salesforce.
The carbon credit market has grown significantly. According to a report released in August 2022 by the non-profit Ecosystem Marketplace, the market for buying and selling permits with a certain amount of carbon is at its highest level since 2005 in 2022. It is said that it has reached a valuation of 2 billion dollars (about 290 billion yen, 1 dollar = 145 yen conversion). In 2021, consulting firm McKinsey expects the market to grow to $50 billion by 2030.
Now, cloud giant Salesforce, with a market capitalization of $150 billion, is entering the market. It has announced that it will launch a carbon credit trading platform in October 2022.
The company’s senior vice president of sustainability, Patrick Flynn, told Insider that the company expects to benefit from rising global demand for private-sector-led “voluntary credit.” talk. In addition, Salesforce will also provide a third-party review system to ensure the validity of projects traded on the platform.
“The market for carbon credits has to grow a lot, and that’s a big reason why we’re doing it,” says Flynn.
Unlike the government-regulated carbon credit market, the voluntary credit market allows companies to fund sustainability projects by purchasing credits of their own choosing, giving them the right to emit more CO2. However, it is not always clear where these funds will flow, and some companies question the effectiveness of carbon credits.
Having established carbon credit certifiers such as Calyx Global and Sylvera display their ratings on the Salesforce platform will bring numbers to the project and increase transparency, Flynn said.
But to reduce carbon in the atmosphere by any significant amount, a large number of users would need to trade credits on the platform. So Flynn says the condition is that more companies take their sustainability goals seriously.
“The difficult part is that we have to deal with climate change with tremendous speed and scale in order to meet the demands of the planet, so we also need to be agile.”
Three years ago, Salesforce released Net Zero Cloud, a product that allows companies to track, analyze and report on their environmental data. Companies like Mastercard and shipping company Crowley have adopted the platform. But some say carbon accounting requires many complex measurements, and concerns remain about a monopoly by a single product or company.
The idea of creating a carbon credit market began in 2017, but the project was put on hold for a while as Salesforce prioritized developing its own net-zero emissions plan. According to Flynn, the project was inspired by Salesforce’s 2021 stakeholder hearings on what the carbon credit market should look like.
Salesforce hires oceanographers, environmental lawyers, engineers and other sustainability experts to get industry-specific feedback.
We are also working with carbon credit providers such as Climate Impact Partners, Cloverly and Pachama to scrutinize the quality of carbon reduction projects. These companies use machine learning and satellite data to identify how much carbon each project will remove.
“It’s a big project to make something for the first time,” says Flynn.
[Original: Inside Salesforce’s ambitious new plan to propel the carbon-credit market to critical mass and make a dent in the crisis climate]
(Edited by Sayuri Daimon)
Source: BusinessInsider
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