The transition towards a new marketplace for carbon credits and low carbon products is increasingly central to businesses' and governments' climate actions, as investments and activities in the sector continue to grow in 2026. These are among the tools being used to reduce greenhouse gas (GHG) emissions, but being knowledgeable about them and how they can be used correctly is critical to making them credible and effective on climate action, experts advise.

Carbon credits are tradable certificates to represent the reduction, removal or avoidance of one tonne of carbon dioxide (or equivalent) emissions to the atmosphere. These credits, which can be built on existing avenues of regulated carbon markets and voluntary schemes, are meant to enable companies to offset emissions that they cannot immediately eliminate, but to incentivise the funding of emissions reduction projects like reforestation, renewable energy and methane capture.

But the article notes that not all carbon credits are equal, the piece of the carbon credit puzzle that briefly received more attention in recent times. Credibility of the credit is ensured by additionality (whereby the carbon benefit must or else not have taken place without the project) and also by existence and by independent compliant third-party verification. If not properly designed, low-quality credits can overestimate climate benefits and frustrate other mitigation efforts.

In addition to carbon offsets, businesses across sectors are increasingly adopting low-carbon products and services, as they produce much lower emissions throughout the product's entire life cycle. This could range from carbon footprint-conscious construction materials, to energy-saving appliances, plant-based meals and materials created from sustainable fiber. Companies are using carbon-footprint labels to help consumers make more environmentally conscious purchasing decisions as well as implementing low-carbon procurement throughout the supply chain.

Industry voices stress that carbon credits and ‘low carbon products' should not be viewed as shortcut solutions. Instead, emissions from the supply chain should be viewed in conjunction with reductions in these direct emissions through operational measures. For example, a hotel can reduce its energy consumption, switch to renewable electricity, improve waste management practices and use high-quality carbon credits only for unavoidable emissions.

Organisations that implement these tools transparently and support them with strong measurement, reporting and governance frameworks are more likely to build trust among customers and stakeholders while making meaningful progress towards their net-zero goals.