The first insetting framework has been published
Insetting has become a scientifically recognized concept through the latest sustainability standards. One such example is the GHG Protocol, which recently published the “Actions and Market Instruments (AMI) Phase 1 White Paper,” serving as a guiding document on the topic. Another is the Corporate Net-Zero Standard V2, which defines value chain–based interventions as a recognized part of corporate target-setting systems. This is all well and good, but they still do not answer the question of how value chain intervention projects should actually be implemented and accounted for in practice.
However, there is already a highly forward-looking solution to this. The Value Chain Intervention Framework (VCIF) developed jointly by SustainCERT and Verra is a full-fledged framework designed to credibly quantify, verify, and report value chain interventions within Scope 3. The VCIF methodology trims the “wild shoots” of insetting by bringing the precision of high-integrity carbon standards into corporate supply chains.
Its scientific significance lies in creating concrete interoperability between project-based accounting (quantified tonnes) and corporate inventory accounting. This project development tool is essential for companies that want to transform the technological and ecological footprint of their suppliers, while ensuring that these financial investments produce auditable and accepted outcomes in the eyes of regulators (e.g. CSRD/ESRS) and standard setters (e.g. SBTi).
The VCIF is aligned with the above key standards. Its application enables companies to directly reflect the impacts of investments carried out at suppliers (e.g. regenerative agriculture, energy efficiency, recycling) in their own inventory, while also providing a transparent solution for data traceability and avoiding double counting.
What does co-claiming mean?
The methodological innovation is that it makes co-claiming (shared claims) the basis of insetting accounting through an allocation mechanism. Since a given supplier may sell to multiple large companies, and thus be part of multiple value chains, the impact of interventions at the supplier must be fairly and accurately allocated.
The methodology offers several mechanisms for this allocation. Physical traceability is used as the primary method when the path of the material can be precisely tracked from producer to final product (e.g. in the case of digital product identification). Mass balance is applied where sustainable and conventional materials (e.g. virgin plastic granulate and recycled regranulate) are mixed during processing, but the proportion of sustainable input remains fixed according to a defined recipe. Finally, the book and claim method is also acceptable, provided that the environmental benefit (e.g. 1 tonne CO₂e reduction) is separated from the physical product but can still move independently within the value chain as a digital certificate.
Strict accounting rules are the foundation
When defining the baseline, the impact of value chain interventions must be measured not in absolute terms, but compared to a business-as-usual scenario. This ensures that only changes resulting directly from the intervention can be accounted for. Furthermore, the methodology explicitly recommends the use of dynamic baselines, which take into account market trends (i.e. must be reviewed at least every 5 years) or changing environmental conditions (e.g. annual precipitation-based adjustments).
The framework also requires proper proof of additionality. In other words, it must be demonstrated that the emission reduction would not have occurred within the value chain without the financial and/or technical support of the company maintaining the value chain.
The methodology defines verification requirements and details the process of independent third-party assurance. First, the project plan must be validated before the intervention begins. This is followed by continuous monitoring, and then periodic certification of results by an independent organization. The biggest limiting factor in project development is data scarcity. Therefore, the framework encourages the collection of primary data in line with the GHG Protocol. To prevent double counting, issued certificates are stored in the Verra central registry with unique identifiers, ensuring proper risk management.
EU regulation is also shifting
The above standards and the VCIF framework both indicate that the market is moving away from external offsetting toward value chain interventions based on real physical and economic connections. The GHG Protocol focuses primarily on reporting structures, SBTi on strategic targets, while VCIF focuses on technical implementation.
The growing importance of insetting has also been recognized by the EU in the ongoing Carbon Removal and Carbon Farming Regulation (CRCF). If this regulatory direction continues, all conditions may be in place for insetting to become one of the defining tools of corporate decarbonization in Europe.