Can carbon credits regain their credibility in logistics?

According to insights from Baxter Freight, a leading UK logistics specialist, the answer may lie not in abandoning carbon credits altogether, but in embracing a new generation of transparent, verifiable crediting mechanisms.

The Sustainability Plateau

For over a decade, logistics companies have implemented the low-hanging fruit of carbon reduction: LED lighting installations, car-sharing schemes, and optimised heating and cooling systems. These measures, whilst beneficial, represent merely incremental progress towards ambitious net-zero targets.

Tom Isler, Sustainability and Innovation Manager at Baxter Freight, explains: “When it comes to carbon credits, businesses have been making the ‘easy’ changes for more than a decade: LED lighting, car sharing, limiting air conditioning and heating. Yet this isn’t enough to reach the heavily bejewelled titles of Net-Zero or Carbon Neutrality.”

The reality is that freight operations generate substantial emissions that cannot be eliminated through operational tweaks alone. Road haulage, sea freight, and air cargo inherently produce carbon emissions that require offsetting strategies if companies are to meet government-mandated targets within prescribed timeframes.

“Businesses must look for external carbon reduction strategies, beyond the realm of their own carbon footprint,” Isler notes, “and carbon credits have been catalysts of external carbon reduction for a number of years.”

Why Carbon Credits Earned a Bad Reputation

The credibility crisis facing carbon credits stems from legitimate concerns about their integrity. Media investigations have exposed projects where claimed carbon savings bear little resemblance to actual impact. In some cases, credits have been issued for initiatives entirely unrelated to carbon reduction—well-meaning conservation efforts that nonetheless don’t offset the emissions they’re purported to neutralise.

Isler highlights the fundamental disconnect: “The varying legitimacy of the credits has led to negative media coverage, with their purpose being put into question when the project associated with the credit is not saving the same amount of carbon being claimed or, worse still, the project has nothing to do with carbon reduction in the first place.”

He provides a stark example: “Investing in an orangutan sanctuary in Bali should not allow companies to reduce their emissions caused by logistics. The cause and effect are simply not the same.”

This mismatch between claimed benefits and real-world impact has left companies vulnerable to greenwashing accusations, creating a reputational minefield for businesses genuinely seeking to reduce their carbon footprint.

A New Era of Carbon Crediting

The solution isn’t to dismiss carbon credits entirely, but to demand higher standards of verification, governance, and technological oversight. Modern carbon crediting frameworks are emerging with significantly improved transparency and accountability.

Precision Matching for Different Emission Types

Advanced methodologies now enable precise matching between emission sources and offset projects. Scope 1 and 2 emissions can be offset against verified carbon sequestration initiatives, whilst Scope 3 logistics emissions can utilise book-and-claim systems that ensure genuine equivalence. Under these rigorous protocols, one carbon credit genuinely represents one tonne of carbon saving.

This precision matters enormously for logistics operators. The freight sector faces unique decarbonisation challenges due to the energy-intensive nature of moving goods across distances. Unlike office-based businesses that can achieve substantial reductions through renewable energy procurement, logistics companies require external mechanisms to bridge the gap between current operations and net-zero ambitions.

Funding the Transition to Low-Carbon Freight

Beyond offsetting current emissions, credible carbon credits serve another crucial function: financing the infrastructure needed for truly sustainable logistics. Electric shipping, carbon capture technologies, and alternative fuel systems require massive capital investment to become commercially viable.

The Investment Cycle

Corporate participation in high-quality carbon credit schemes provides a mechanism for businesses to contribute proportionally to these essential upgrades. Companies benefit from legitimate carbon reductions in their reporting, whilst simultaneously funding projects that will eventually eliminate the need for offsetting altogether.

This creates a virtuous cycle in which today’s carbon credits finance tomorrow’s low-carbon infrastructure, provided the credits themselves meet stringent verification standards.

Overcoming the Perception Problem

Perhaps the greatest challenge facing reformed carbon crediting isn’t technical but perceptual. The legacy of poorly verified credits has created deep scepticism among media, investors, and the public. Even as governance improves, the “carbon credit” label carries negative connotations.

Restoring confidence requires sustained transparency from both credit providers and purchasing companies. Detailed disclosure about project types, verification methodologies, and additionality criteria must become standard practice. Logistics businesses that leverage carbon credits need to clearly articulate not just what they’re offsetting, but how they’re ensuring the integrity of those offsets.

The Role of Industry Standards

Industry bodies and regulatory frameworks also have a role in establishing clear standards that separate legitimate credits from questionable schemes. As these standards mature, companies will find it easier to engage with carbon markets without fear of reputational damage.

The Long Road to True Decarbonisation

Carbon credits should never be viewed as a permanent solution or an excuse to delay direct emission reductions. The ultimate goal remains a logistics sector powered by zero-emission vehicles, renewable energy, and circular supply chains.

However, that transformation won’t happen overnight. The technology exists in various stages of development, but scaling it across the entire freight industry requires time, investment, and supportive policy frameworks. During this transition period—which may span decades—credible carbon credits provide an essential bridge.

Every major logistics market, from the UK to emerging economies, faces a different timeline for decarbonisation based on infrastructure investment, policy support, and technological readiness. Until low-carbon transportation and high-yield carbon sequestration become ubiquitous, there will always be projects requiring funding and companies seeking to offset unavoidable emissions.

Making Carbon Credits Work for Logistics

For freight companies navigating this complex landscape, several principles can guide effective carbon credit strategies:

Key Principles for Credible Carbon Offsetting

• Prioritise direct reductions first: Carbon credits should complement, not replace, operational efficiency improvements and technology upgrades within your own operations.
• Demand verification and transparency: Work only with credit providers who can demonstrate rigorous third-party verification, clear additionality, and permanent carbon impact.
• Match emissions to offsets: Seek credits from projects relevant to your industry—logistics emissions are best offset through transportation-related projects or energy transition initiatives.
• Communicate honestly: Be transparent with stakeholders about why you’re using carbon credits, what safeguards you’ve implemented, and what your timeline is for direct emission reductions.
• Support systemic change: Where possible, choose credit schemes that fund infrastructure development rather than simply preserving existing carbon sinks.

The Path Forward for Freight

The freight industry stands at a crossroads. Government regulations increasingly mandate carbon reductions that cannot be achieved through operational measures alone. Yet the credibility crisis surrounding carbon credits has made many companies hesitant to engage with offset markets.

The path forward requires embracing the new generation of verified, transparent carbon crediting whilst maintaining focus on direct emission reductions. For logistics businesses, this balanced approach offers the most realistic route to meeting net-zero commitments without falling prey to greenwashing accusations.

As technology, governance, and verification methods continue improving, carbon credits may yet fulfil their intended purpose: enabling companies to take responsibility for unavoidable emissions whilst funding the low-carbon infrastructure that will eventually make those credits obsolete.