Corporates Ready to Move Forward on Carbon Removal Purchasing - Research

Companies see carbon dioxide removal (CDR) as essential to reaching net zero, but are holding back on investment until policy and reporting rules become clearer, creating a "wait-and-see" market, new research from the Carbon Business Council finds.

The data is based on in-depth interviews with senior sustainability leaders across Fortune 1,000 companies in the United Kingdom, United States, Germany and France, all with net zero commitments but no formal carbon removal purchasing strategies. It finds that while companies see carbon removals as essential to achieving net zero, they need clear policy frameworks to justify meaningful near-term investment. The research was led by Bellwether Research. Contd

Policy emerged as one of the most consistent barriers to action. Companies expressed concern that carbon removal credits purchased today may not be recognised under future reporting or regulatory frameworks. In Europe, uncertainty around the Corporate Sustainability Reporting Directive (CSRD) and Green Claims Directive was frequently cited. In the United States, respondents pointed to political volatility and the absence of clear federal direction as contributing to a delayed approach.

Many companies said mandatory purchasing requirements, even at low initial levels, would be one of the most effective ways to create a predictable, stable market signal for the CDR industry. Companies also pointed to financial incentives – such as tax relief and subsidy mechanisms, similar to those used for solar and wind – as important tools to improve cost competitiveness and support early market growth.

"Clearer rules and guidance are needed to accelerate action and drive future supply," said Ben Rubin, Executive Director of the Carbon Business Council. "Policy leadership can support earlier, more consistent private sector investment, which will mobilise the capital needed to scale carbon removal in the near-term."

Across the countries surveyed, the study finds that both government policy and corporate frameworks play distinct roles in driving CDR investment. Governments set the enabling conditions through targets, regulation and incentives, but frameworks like the Science Based Targets initiative (SBTi) and the Corporate Sustainability Reporting Directive (CSRD) are increasingly decisive in shaping corporate behaviour, defining what credible climate action looks like, embedding expectations into strategy and disclosure, and ultimately creating the demand signals that translate ambition into investment.

With updates to the EU Emissions Trading System and the Science Based Targets initiative's Corporate Net Zero Standard expected this year, the window for policy leadership is now. Early policy clarity and demand signals will play a key role in determining how quickly carbon removal can scale from an emerging market to an established climate solution.

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