Nearly 60% of senior UK decision-makers don’t fully understand carbon credits, despite their growing role in corporate net zero strategies, according to an Octopus Investments report.
The report surveyed 300 senior business leaders across multiple sectors, alongside data analysis from third-party platforms like the Science Based Targets Initiative (SBTi) and interviews with industry experts. According to the investment manager, the knowledge gap threatens progress in tackling hard-to-abate emissions.
While 86% of UK businesses have set net zero targets, confidence levels are high — 92% believe they will meet their goals. However, the researchers warned that this optimism may underestimate the complexity of reaching net zero, with 19% of businesses mistakenly believing they can eliminate emissions.
The study highlighted a growing realisation that carbon credits will be essential for offsetting unavoidable emissions, with 73% of businesses planning to buy them. However, only 42% of senior leaders could correctly define carbon credits and just 46% understood carbon removal credits. This suggested that businesses may struggle to make informed purchasing decisions.
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“For the UK’s corporate sector, bridging the knowledge gap around carbon credits isn’t just beneficial – it’s necessary,” said Mike Toft, senior fund manager at Octopus Investments. “By focusing on education, collaboration and high-integrity solutions, we can help restore trust in the market and set a new standard for climate action.”
Concerns around transparency and accountability are also holding companies back, with 28% of businesses citing a lack of clarity as a key barrier to buying carbon credits. Past scandals have heightened fears of greenwashing, particularly with lower-quality avoidance credits that don’t deliver real carbon reductions.
The report emphasised the importance of high-quality, traceable carbon credits. 76% of UK businesses said they would be more likely to buy credits if generated in the UK, citing greater trust in domestic oversight and government-backed initiatives.
Lieven Debruyne, CEO of Octopus Investments’ institutional business, said: The path to net zero is about more than meeting regulatory targets – it is about building a lasting legacy of climate leadership and ensuring a resilient planet for future generations. By moving forward together, businesses, governments, and investors can ensure their actions contribute to achieving net zero goals and leave a lasting, positive impact on the planet.”
