Hundreds of Australian businesses have withdrawn from the federal government’s voluntary carbon-neutral certification programme, Climate Active, amid increasing doubts over the legitimacy of carbon offsets.
For over a decade, corporations have spent millions purchasing carbon credits in the voluntary market to reduce their environmental footprint. However, growing scepticism over whether these offsets genuinely cut greenhouse gas emissions has sparked an exodus from the scheme.
In the past two years alone, more than 100 major organisations—including Australia Post, Telstra, NRMA, Canva, PwC, and even the government’s Clean Energy Finance Corporation—have abandoned Climate Active. Their departure underscores mounting concerns over the effectiveness and integrity of carbon offsets, which are now viewed as a costly and ineffective solution to emissions reduction.
The Property Council of Australia has raised alarm over the credibility and environmental integrity of carbon credits, with many linked to projects of dubious benefit. Some schemes, such as tree-planting initiatives, face issues of longevity, while others merely shift emissions rather than reduce them. As a result, businesses investing in offsets risk reputational damage while failing to achieve meaningful environmental progress.
A 2023 report from the Australian National Audit Office found that many government-backed carbon credit schemes failed to deliver promised emissions reductions, raising questions about transparency and oversight. Critics argue that the system primarily benefits consultants and auditors rather than delivering tangible climate action.
With Climate Active faltering and trust in carbon markets eroding, calls are growing for the government to rethink its carbon-neutral policies. Instead of funnelling billions into offset schemes of questionable value, experts suggest prioritising technological innovation, renewable energy advancements, and pragmatic policies that balance environmental goals with economic sustainability.
As businesses turn away from ineffective carbon accounting measures, pressure is mounting on the federal government to shift focus towards genuine, long-term solutions for emissions reduction.
