Executive summary
As food and beverage companies accelerate efforts to meet ambitious greenhouse gas (GHG) reduction targets, questions of additionality, whether emissions-reducing activities would have occurred without program support, have become central to the credibility of both offset and supply chain inset programs. Recent controversies surrounding non-additional forestry credits have heightened scrutiny from regulators, investors, media, and consumers, increasing the stakes for companies making climate claims and underscoring the need for robust, defensible program design.
For food companies, the transition from traditional offsets toward Scope 3 inset programs presents new opportunities but also new complexities. Unlike offsets, insets are embedded within a company’s own value chain, and therefore follow different rules, incentives, and accounting constraints. Inset programs must align with guidance from the Greenhouse Gas Protocol, Science Based Targets initiative (SBTi), and CDP while navigating data limitations, varying supplier practices, and evolving industry standards. As a result, companies bear significantly more responsibility for ensuring program rigor, establishing reliable baselines, and preventing double counting.
The livestock and dairy sectors illustrate these challenges clearly. Practices such as manure management, methane-reducing feed additives, and improved cropping systems vary widely across regions and farm types. Many interventions lack strong economic incentives for producers absent carbon program support. Traditional offset-style additionality tests, such as excluding “common practice” interventions or discounting farms with prior practice adoption, can unintentionally limit participation, overlook real emissions impacts, or create inequity among producers. At the same time, food companies often lack comprehensive insight into the practice assumptions embedded in their Scope 3 baselines complicating efforts to determine whether funded reductions meaningfully accelerate progress toward inventory targets.
Quantifying project impact adds another layer of complexity. While offset protocols prescribe detailed baseline and quantification methodologies, inset programs have considerably more flexibility. This allows tailoring to diverse production systems but also increases variability, reduces comparability, and raises the risk of external criticism. Clearer, industry-aligned best practices would streamline development, strengthen credibility, and build confidence among stakeholders.
Despite these challenges, the path forward is becoming increasingly clear. Ensuring credible additionality in inset programs will require food companies to invest in supply chain data systems, establish internal governance for baseline and quantification methodologies, and collaborate with peers and standards setters to define practical, scalable norms for inset program integrity.
As food companies expand their Scope 3 decarbonization efforts, a thoughtful, well-governed approach to additionality will protect reputations, optimize investment, and ensure that on-farm reductions in livestock and dairy meaningfully contribute to climate goals. A forthcoming paper, Addressing Additionality in Inset Programs, will present pragmatic strategies to help companies navigate these emerging risks and opportunities as the inset landscape continues to evolve.