It’s not surprising the nascent carbon-offset industry should be concentrated in the world’s industrialized north, the main source of greenhouse-gas emissions and of regulatory schemes aimed at curbing them. But the trend also has reached developing countries.

Consider Brazil, where three São Paulo consulting firms are working to meet expanding demand for offsets from Brazilian companies interested in reducing their carbon footprint. The firms—Iniciativa Verde, a nonprofit, and MaxAmbiental and Key Associados, both of which are for-profit—measure companies’ carbon emissions and help generate offsets through such means as planting trees.

All three report fast-growing business—and a mix of motives on the part of their clients ranging from altruism to an entrepreneurial interest in affixing “carbon neutral” seals to their products or services.

“Brazilian companies neutralize their emissions because they want to be more environmentally responsible, because they want to use ‘carbon free’ seals to boost sales, or because clients pressure them to do so,” says Francisco Maciel, the co-director of Iniciativa Verde. “It is hard to know where their eco-responsible side ends and where their marketing side begins.”

Growing interest

Reports Adauto Basílio of SOS Mata Atlântica, a Brazilian nonprofit that supplies seedlings to companies seeking offsets: “In 2006, 20 companies in Brazil contacted us about buying trees to neutralize their carbon emissions. In 2007, the number grew to 150.”

To generate offsets, the three firms most commonly arrange to have native trees planted, often on deforested riverbanks to help prevent erosion. The quantity of emissions that must be offset determines the number of trees, which absorb carbon as they grow.

Iniciativa Verde is the only one of the three firms that provides one-stop services for companies looking to neutralize carbon emissions. Since 2005, it has helped 100 companies plant 130,000 native trees. In doing so, it inventories clients’ carbon emissions, buys and plants the trees needed to counterbalance them, monitors the trees’ growth over five years and provides companies with a “carbon free” seal, which some clients use to market their products.

Last year, one Iniciativa Verde client, paint maker Anjo Química, planted 3,000 trees to offset carbon emissions stemming from its 2007 house paint production. “Our main goal was to boost sales, and our three-month ‘carbon free’ advertising campaign in 2007 increased house paint sales fivefold,” says Vaty Colombo, the company’s marketing director. “When we ended the campaign and just used the seal on our house paint, sales increased by only 10%. So we plan to plant more trees to offset emissions this year, and resume the campaign.”

Nutrimental, a Brazilian cereal bar producer, offset its 2007 emissions by planting 7,800 trees and plans to continue doing so “simply because environmental concerns are part of our DNA, one reason our cereal bars contain sustainably harvested ingredients,” says Ronaldo Flor, the company’s executive director.

Maciel says Iniciativa Verde is a nonprofit because making money from carbon offsets is “impossible.” But competitor MaxAmbiental, whose clients have paid to plant over 60,000 trees so far, insists it has found a way to profit. Instead of buying seedlings from nurseries as Iniciativa Verde does, it works with local communities to grow them at low cost near where they’ll be planted. It also has partnered with a federal university in Paraná state that monitors the trees’ growth for five years.

Core activities

“We can make a profit because we only charge for carbon-neutral consulting services and seals, as well as for advising clients how to reduce carbon emissions,” says Eduardo Petit, MaxAmbiental’s commercial director.

Key Associados, the third consulting firm, says it is profitable partly because of its relationship with SOS Mata Atlântica, which sells its clients seedlings from its own or other nurseries and monitors their growth for five years. Then a private firm certifies the process via its own carbon-neutral seal. Like MaxAmbiental, Key only charges for calculating carbon emissions and advising how to reduce and offset them.

Fernando Lopes, a Key Associados director, says clients have planted 150,000 trees. “The carbon neutral seal our clients get is reliable because it comes from a certification company not linked to our consulting firm,” he says.

MaxAmbiental is the only one of the three consulting firms that advises some clients to offset emissions by funding forest conservation. Last year one client, Mantecorp, began to offset emissions by paying a landowner in the vast, biodiverse Pantanal floodplain to ensure cutting doesn’t occur on 1,100 forest acres (450 has).

Iniciativa Verde, however, doesn’t believe that forest conservation justifies offsets. “It’s valid to discuss protecting forests at climate change conferences,” says Maciel. “But because doing so avoids new carbon emissions rather than reducing existing ones, it’s not valid as a carbon offset strategy.”