Sugi launches carbon offsetting – our latest feature to help everyday investors take control of their impact.
Now anyone with a portfolio can check the carbon impact of their investments and offset some (or all) of it using verified carbon credits.
Sugi has partnered with the brilliant Ecosphere+ to ensure the credits we offer are fully certified, internationally recognised and meet the highest environmental standards.
How does offsetting work?
Trees absorb around 115–150kg of carbon during a 30–50 year lifespan. Planting new trees and conserving existing trees under threat can save carbon from the atmosphere. This saved carbon is recorded in the form of a ‘carbon credit’.
Not every tree-planting or conservation project generates carbon credits, and projects must satisfy many criteria to be properly certified.
The credits available through Sugi are accredited by Verra’s Verified Carbon Standard, the world’s most widely used voluntary greenhouse gas certification programme. This certification demonstrates that carbon emissions really are reduced and the underlying project delivers lasting climate benefits.
The credits are listed on an international register. Once purchased, they are retired and can never be bought by anyone else. That means there’s no ‘double counting’ of these credits anywhere in the world.
More than carbon savings
Some of the best projects offer additional environmental and social benefits, as well as the all-important carbon saving. For Sugi’s first project, we’ve chosen the Tambopata-Bahuaja reserve, deep in the Peruvian Amazon.
This project protects around 600,000 hectares of threatened rainforest, restores 4,000 hectares of degraded land, protects 30 key species (including jaguars, macaws and giant otters), and collaborates with local communities to achieve sustainable economic development in the region.
In fact, it meets 11 UN Sustainable Development Goals and has been certified by the Climate, Community and Biodiversity Alliance to the Gold Standard, representing excellence in the areas of biodiversity and climate change adaptation.
Why does Sugi offer carbon offsetting?
Sugi’s mission is to help everyday investors make greener choices. Plug your portfolio into Sugi and you can see its carbon impact and global warming temperature; check the impact of each investment and whether it’s better or worse than the industry average; and compare with similar investments in the market.
You can use this information to better understand your own impact and identify greener investments. At the same time, there may be valid reasons to maintain your exposure to higher carbon investments. With offsetting, you can rebalance your portfolio’s impact while greening up your investments in other ways.
For example, if you want to reduce the climate impact of your portfolio to a minimum, you might be drawn to low-carbon sectors, notably tech, financials and healthcare, within developed economies. But focusing solely on these sectors might not fit with your overall investing objectives, including maintaining a diversified portfolio.
You might also want to invest in ‘transition’ companies. These are companies, typically in polluting sectors, working hard to decarbonise their activities. They might have a high carbon impact now, but without ongoing financing and other shareholder support they could struggle to achieve their net zero commitments.
Or you might want to invest in companies that are creating technologies to help others decarbonise – so called ‘climate solutions’ companies. These companies are doing innovative work and could have an important role in the fight against climate change, but again they often have a high carbon impact themselves.
Finally, every company, however sustainable, has some carbon impact. If you hold any equity investments, you will always have some level of climate impact attributed to your holdings.
Offsetting means you can maintain a diversified portfolio while taking positive climate action now. Importantly, it doesn’t let companies off the hook. The pressure remains on individual companies to decarbonise their operations, and your offsets don’t count towards any net zero commitments they have made.
Another step on the path to greener investing
We’re on a journey to provide Sugi users with a personalised climate impact toolkit for their investments. Offsetting is just one way you can make a difference today. And we’re looking forward to sharing our next exciting feature with you soon.
In the meantime, take a look at offsetting on the Sugi app and let us know how you get on!
Download the Sugi app now from the App Store here.