Climate clause

Carbon Neutral Agreement Clause

Mackenzie & Maggie’s Clause

Mackenzie & Maggie’s Clause places a 'light green' obligation on shareholders to work towards operating the company in a carbon neutral manner.

This is a climate clause

This clause brings climate considerations to your drafting. It is not yet net zero aligned. To align this clause with net zero, use our toolkit or join one of our events.

Skip to clause

Why use this?

Mackenzie & Maggie’s Clause does not set specific targets for when carbon neutrality should be achieved. As such, it might be appropriate for 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.

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

The clause

Additional definitions 

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.]

 

Additional clause

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.

Read the disclaimer

Join the largest global network of lawyers and business leaders using climate contracting to deliver fast and fair decarbonisation

Join us