Mackenzie and Maggie’s Clause

Carbon Neutral Agreement Clause

This clause places a 'light green' obligation on shareholders to work towards operating the company in a carbon neutral manner.

Jurisdiction: Aotearoa New Zealand

What this clause does

Enables a company to place an obligation on shareholders. It may be appropriate for use by a company that is embarking on its emissions reduction journey, or which is a new or fast-growing company that does not yet have a good understanding of its emissions profile. This clause does not set specific targets for when carbon neutrality should be achieved.

This clause adapts [Callum & Theo’s Clause] Climate Standard Transaction Terms for use in Aotearoa New Zealand.


1. Carbon neutrality

The parties agree that their collective intention is that the Business of the Company should be conducted in a manner which is at least Carbon Neutral and agree to work together in good faith to further that intention.


Carbon Footprint means the total annual Scope 1, 2 and 3 Emissions relating to the Business operations. 

Carbon Neutral means the reduction and offset of the Company’s Carbon Footprint on an annual basis, achieved by:

(a)  first, using reasonable endeavours to reduce its Carbon Footprint; and

(b)  second, offsetting* its residual Carbon Footprint (for example, by purchasing (and cancelling) New Zealand units as defined in the Climate Change Response Act 2002).

Scope 1, 2 and 3 Emissions means the three classifications of emissions in The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard, Revised Edition 2015, as updated periodically.

* [Drafting note: to define offsetting, consider using the TCLP Glossary: Offset or Offsetting.]


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We'd like to hear how you've implemented our clauses in your organisation.

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