What are the Oxford Offsetting Principles?

The Oxford Offsetting Principles are four principles created to provide a resource for designing and delivering rigorous voluntary net zero commitments by governments, cities, and companies and help to align work on credible offsetting around the world.

First released in 2024, they were revised at the start of 2024 to address critical changes in the market in the last several years: evidence that avoidance schemes are over-crediting, and that the market is far away from the scaling needs especially of durable solutions.

With this reframing in mind, the core principles help companies pursue a net zero future without fears of greenwashing. Companies that align with the principles can genuinely communicate their impact with minimal reputational risk, reaping the benefits of their actions. The 4 Principles are as follows:

1. Urgently reduce emissions, ensure integrity, and regularly revise as best practice evolves.
2. Shift to removal approaches for any residual emissions.
3. Shift to more durable removals with a low risk of reversals.
4. Support the development of innovative and integrated approaches to achieving net zero.

In the following, we cover the principles and explain how you can align your business with them to ensure the credibility of your efforts is not questioned.

Why should companies follow the Oxford Offsetting Principles?

Carbon avoidance offsetting has gotten a bad reputation over the last decade–and for good reason. Companies have relied on cheap, low-quality offsets that don't actually remove CO2 emissions from the atmosphere. In combination with over-communication on the impact of offsets, many companies' efforts can be classified as greenwashing. On the other hand, companies fear greenwashing accusations, leading to green-hushing and stagnancy in climate action

However, the science is quite clear: We will only be able to stay within the goals of the Paris Agreement with significant carbon removal. Private companies are a crucial driver of this, and if they cannot compensate for their emissions in a trustworthy manner, we will not be able to scale the technologies needed.

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The principles and how to align.

Principle 1

Cut emissions as a priority, ensure the environmental integrity of credits, and regularly revise as best practice evolves.

Principle one is all about ambitiously reducing your own value chain and, where you can't, adapting to the highest possible quality of credits as the market develops.

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Key point 1.1

Prioritise reducing your own emissions - Minimise the need for offsets in the first place. Ambitious reductions in tandem with removals–a concept called dual targets–are the most robust approach a company can take.

Key point 1.2

Ensure environmental integrity - Use credits that are verifiable and correctly accounted for and have a low risk of non-additionality, reversal, and creating negative unintended consequences for people and the environment.

Key point 1.3

Maintain transparency—Disclose current emissions, accounting practices, targets to reach net zero, and the type of offsets you employ. Clarity and transparency are essential to effective climate communication, which is why they remain a major focus of our public ledger, certificates, and communications support.

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Principle 2

Transition to carbon removal offsetting for any residual emissions (away from emissions avoidance or reduction) by the global net zero target date.

This is a big one, but luckily, it's also easy to achieve if you are willing to go the extra mile. This principle is about moving from projects that avoid emissions entering the atmosphere (such as windmills) to projects that remove carbon from the atmosphere.

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Key point 2.1

Today, reduction or avoided emissions projects make up most of the market. Net zero requires scaling removals to multiple giga-tonne capacity. Quality reduction projects are necessary but insufficient to achieve net zero in the long run, whereas carbon removals scrub carbon directly from the atmosphere.

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Principle 3

Shift to removals with durable storage and low risk of reversal.

All carbon dioxide needs to be stored, and different methods vary in their length or susceptibility to releasing GHGs back into the atmosphere, i.e., the risk of reversal. Methods of storage vary in durability and reversal risk, leading to a spectrum of nature-based, engineered, or hybrid solutions. All these play a key role in accelerating and reaching net zero.

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Key point 3.1

Some short-lived storage methods have a higher risk of being reversed over decades. Other long-lived storage methods can carbon with a low risk of reversal over centuries to millennia, such as storing CO₂ in geological reservoirs or mineralising carbon into stable forms.

Short- and medium-storage solutions with moderate reversal risks still remain critical as they help buy time to reduce emissions and support biodiversity and ecosystem resilience.

Investment and scaling today must recognise the need for improving and accelerating durable technologies. This must begin now, and incorporating these alongside nature-based solutions sends an important market signal. Maximising impact through a portfolio achieves a great balance of these priorities.

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Principle 4

Support the development of innovative and integrated approaches to achieving net zero.

Today's market is still in its early stages, and early adopters are necessary to support its growth. This means companies like yours can impact a developing quality market and reap the benefits of being a first-mover.

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Key point 4.1

Use long-term agreements that are bankable and investable – so that project developers can have the certainty required to create credits for net zero goals. One element is signing long-term agreements facilitated by Klimate.

Key point 4.2

Form sector-specific alliances—work collaboratively with peers to develop the net zero-aligned offsets market. One key element of this is shifting demand by advocating for stronger industry bodies and standards supported by policy. The other side involves guiding buyers to send demand signals through investments that follow principles 2 and 3.

Key point 4.3

De-risk project finance. Similar to points 4.1-.2, signing long-term agreements, often called advanced market commitments, improves project developers' security and, therefore, scalability. Facilitating and contracting these agreements can be difficult, which is why Klimate has created a single digital contract and platform for tracking and streamlining the procurement process over multiple methods and timelines.

Key point 4.4

Support the restoration and protection of a wide range of natural and semi-natural ecosystems in their own right – not only will this secure the ecosystem goods and services on which humans depend, including resilience to the impacts of climate change, but it will also contribute to carbon storage over the long term. This highlights the portfolio approach and the importance of synergies through co-benefits.

Key point 4.5

Adopting and publicising these Principles and incorporating them into regulation and standard-setting for approaches to offsetting and Net Zero. This key point is self-explanatory: transparent and clearly stating the strategy of your offsetting activity is key to effective climate communication.

Key point 4.6

Invest in additional mitigation beyond the value chain. We've got a long way to go to develop the market for net zero and limit warming to 1.5. This goal isn't possible without investment today in preparation for a net zero future.

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Manage future risk with carbon removal.

We didn't come up with the Oxford Principles, but they help inform our science-backed approach to carbon removal. A robust scientific strategy is required to future-proof your business, manage future compliance, avoid regulatory risks, and even boost brand reputation.

In the past, offsetting markets allowed companies to make claims on the back of low quality offsets–which is wasteful at best and greenwashing at worst. We want to empower companies to do better when they do good. By aligning with the Oxford Principles and building a solution with our team of experts, you can invest confidently and accelerate your company climate journey.

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