January 12, 2023

The Difference Between Carbon Neutral and Net Zero

As business leaders it is important to understand the difference between carbon neutral and net zero, especially when it comes to setting goals for reducing your company’s environmental impact. In this blog post, we will break down what each term means and which strategy may be better for your organization.

What is Carbon Neutral?

Carbon neutrality involves reducing your emissions as much as possible and then offsetting the remaining emissions with investments in renewable energy or other projects that reduce greenhouse gas emissions. Carbon neutrality also covers indirect effects such as supply chain, employee travel, and other activities related to running a business. By offsetting your remaining emissions, you can achieve a net-zero carbon footprint.  

What is Net Zero?

Net zero goes beyond carbon neutrality by taking into account all sources of greenhouse gas emissions associated with running a business (direct and indirect) and aiming to reduce them to zero by investing in renewable energy or other projects that reduce emissions. It doesn’t focus on offsetting remaining emissions; instead, it focuses on eliminating them completely.  This approach requires more effort than carbon neutrality but provides more long-term benefits to both the environment and your bottom line.    

Which Strategy Is Better for Your Organization?

The answer depends on your organization’s current state of sustainability practices and its short-term versus long-term goals. If you are looking for quick wins with minimal effort in the short-term, then carbon neutrality may be the best approach for you. However, if you are looking for long-term sustainability benefits (such as cost savings due to efficiency improvements), then net zero is likely the better choice because it requires more effort upfront but yields greater long-term savings and benefits.  


Overall, understanding the differences between carbon neutrality and net zero can help you set realistic goals for reducing your company’s environmental impact while also providing financial benefits over time. It's important to evaluate both strategies carefully before deciding which one is right for your organization so that you can make sure that you are making an informed decision that will best benefit both your company's bottom line and the environment.

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