Opportunities for "greenwashing" – the method by which companies appear more environmentally friendly than they really are – may be limited in future, thanks to a new government-backed award scheme launched today.

Any company awarded the new Carbon Trust Standard certificate will have had to reduce its greenhouse gas emissions, rather than simply offset them.

Offsetting is the process of compensating for emissions by buying carbon credits that in theory reflect carbon savings made elsewhere, through planting trees, say, or replacing fossil-fuel power stations with renewable energy systems. The problem is that buying the credits does not cut emissions.

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To be awarded the certificate, companies will either have to demonstrate total overall reductions or a 2.5 per cent improvement in carbon efficiency for businesses in which productivity – and therefore emissions – might be growing.

The new award is strongly supported by the CBI and was also welcomed by Greenpeace, which in the past has been one of the organisations most critical of companies it sees as pretending to be environmentally concerned.