How CO2 offsetting works for businesses

Oskar Dahl Hansen



What is carbon offsetting, why does it work and how do you get started as a company?

Calculate, offset and reduce your carbon footprint. These are the three steps we recommend for companies that want to take climate action. But what is carbon offsetting, why does it work and how do you get started? We cover all that in this article.

What are CO2 credits?

A carbon credit is a unit representing that one tonne of carbon dioxide equivalent (tCO2e) has been removed from the atmosphere. CO2 equivalent is a collective term for all different types of greenhouse gases. When we talk about CO2, we really mean CO2e, which also includes other types of greenhouse gases such as methane, nitrous oxide and water vapour.

What is CO2 compensation?

Carbon offsetting means buying a quantity of carbon credits equivalent to your CO2 emissions, for example from running your business.

Once you have an overview of your total carbon footprint, we believe that the first thing you should do is offset. Then you should start reducing your emissions. In this way, you take full responsibility for your climate footprint in running your business.

Another important point is that carbon offsetting is not just about cleaning your own path. In fact, many of the projects that generate carbon credits also help the people most vulnerable to the impacts of climate change.

Why CO2 offsetting is needed

Global warming is a global problem. This means that, scientifically speaking, it doesn't matter where we reduce greenhouse gas emissions. As long as the total amount of emissions is reduced, it does not matter whether it is done in Denmark or in Tanzania.

The global carbon budget indicates that everyone must reduce CO2 emissions now! There are now only a few years left to reduce our emissions before catastrophic consequences of global warming will ravage the world. A fundamental problem with this is that the targets that have been set by countries and companies around the world do not meet a level of reductions that will stop the warming sufficiently.

If the level of ambition is not raised, we simply will not achieve it. This is where carbon offsets and climate projects are a crucial solution, where there are still many low-hanging fruits. This is because the vast majority of climate projects are in developing countries, where there is simply no funding to deliver the necessary CO2 reductions.

Low-hanging fruit

We are frontrunners in the climate fight here in Denmark. There is still some way to go before we reach our climate goals - but we have actually come so far that many of the reduction measures we can take here at home are far less effective than they used to be. On the other hand, many other countries, especially developing countries, are still a long way from being at the same level.

To put this in perspective, a third of the world's population still cooks over open fires. Their total carbon footprint is far lower than the average Dane, but it is extremely cheap to remove the majority of their carbon footprint, while significantly improving their living conditions. Through verified and controlled climate projects, you can help these people significantly and remove CO2 at the same time. It must be what you call a win-win.

It is not enough to reduce

Climaider helps companies and individuals identify actions they can take to reduce their carbon footprint. But we also recognise that it is impossible to become 100% carbon neutral.

Everything we do has a carbon footprint, and there's no getting away from that. You can and must do a lot to reduce it, but there is also a limit to how much you can do. Yet the climate crisis has reached such a critical point that there is no time to wait. If the world does not halve its current CO2 emissions by 2030, things will look very bleak.

This is precisely why we believe that climate projects are a crucial climate solution that should be used by many more companies. If you are already well on the way to greening your business, you can even offset CO2 beyond your own footprint and make a real difference in the fight against global warming.

Consumers demand climate action

Consumers are increasingly demanding products that are in line with their climate and environmental values. In fact, over 90% of European consumers aged 16-65 believe it is fundamentally important for companies to take climate action - and 50% of them are already aware of the carbon footprint of the goods they buy. This is particularly true in the food and cosmetics categories. Therefore, it is already crucial that you take responsibility for the carbon footprint of your company's activities, both from an ethical and a business point of view.

We can help your business with CO2 offsetting

If you want to know more about how you can support climate projects that offset the carbon footprint of your company's activities, email us at We'll find a solution that suits your business and your needs.

Source list

Climate encyclopedia