What We’ve Learned Taking bold climate action is not easy. It requires resources, innovation and determination. But it is feasible, and doing so will result in better, more successful organizations. We’ve learned much about carbon markets since we made our first net zero commitment in 2015, from both our mistakes and from our successes. These learnings have enabled us to improve our programs, develop and share tools like our new Net Zero Marketplace, and support holistic market improvements like VCMI and ICVCM. Based on what we’ve learned, we have built internal quality criteria for carbon credit purchases and developed and linked climate action tools like our internal price on carbon across our business operations. We are still on a learning journey, but this is a good time to take stock of what we’ve learned so far. Along the way, we continue encountering the same four fundamental issues, which in aggregate keep the VCM from reaching its potential: integrity, complexity, quality, and supply. Let’s take these in turn and reflect on what we’ve learned, and why all these challenges can and will be overcome. Opportunities to Scale the Voluntary Carbon Market Increase Integrity Reduce Complexity Increase Quality Increase Supply Carbon markets are scaling Carbon markets are complex Most of current supply Exponential increase in but remain small, and their and difficult to navigate, is poor quality, risking supply needed, requiring use is controversial impeding action market trust millions of new ecopreneurs Reduce and compensate Educated buyers and Improved methodologies, Democratized access to as the norm simpler markets new products expertise and capital Companies must reduce AND compensate: this is not a moment for “either/or”. The first — and perhaps the largest — challenge is a lack of integrity. The primary criticism of the VCM is that it’s an easy way out; an excuse for not taking more difficult or more costly climate action, such as reducing emissions. The solution is a simple one: companies must set separate targets for reducing emissions in line with a 1.5° C world AND compensating for any remaining emissions with carbon credits. Today, we cannot view these actions as interchangeable, or in conflict, but as complements. That’s why we’ve set an ambitious emissions reductions target, which goes even further than our science-based target, to reduce our scope 1, 2 and 3 emissions 50% by 2030, without the use of renewable energy credits, carbon credits, or any other market-based tool. In addition, we are also committed to purchasing carbon credits equivalent to our residual emissions on an annual basis. While these targets are linked, as both relate to our emissions, they are managed separately. 7 | A JUST TRANSITION TO A NET ZERO, NATURE POSITIVE WORLD