Definition 1
Carbon Neutral Date means the date set by [the Board of the Company] to achieve Carbon Neutral status [which date should not be more than 24 months from the date of the meeting convened under clause [●]].
Definition 2
Carbon Neutral Date means the date set by [the Board of the [Company/Borrower] to achieve Carbon Neutral status [which date should not be more than [24] months from [the date of the meeting convened under clause [●]/the date of this Agreement/insert other date].
Definition 3
Carbon Neutral Date means the date set by the Board of the [Company/Borrower] for [any Eligible Transaction [funded by the Company using monies provided by the [Shareholder/Lender]] [or guaranteed by the [Guarantor]] to achieve Carbon Neutral status[, which date should not be more than [24] months [from the date of [signing/execution/implementation] of the relevant Eligible Transaction/ insert other date].
Drafting notes and guidance
Setting a carbon neutral date
A carbon neutral date can be set voluntarily by any organisation that wants to show its climate change ambitions. Alternatively, the organisation might be compelled to set a carbon neutral date by its investors if it has not already done so voluntarily.
Relevant considerations
Whether carbon neutrality is possible will depend on jurisdiction and the organisation's access to carbon offsetting mechanisms and renewable energy, amongst other factors.
Just transition
Carbon neutrality may be too ambitious in some jurisdictions. Lawyers using this definition might want to consider alternative actions that would have a positive impact (or less of a negative impact), such as the protection of carbon sinks.
The difference between net zero and carbon neutral
Net zero and carbon neutral are terms that are often used interchangeably. However, the terms are distinct, not interchangeable and differ in a number of important respects. For an explanation of the difference between the two, please refer to the drafting notes for Net Zero.