While the long-term goal is to lower GHG emissions through internal programs, additional measures will be needed to achieve the 2012 target. The Kyoto Protocol includes carbon-offset options, such as the United Nations Clean Development Mechanism – that enable companies or countries to compensate for exceeding emission limits through offsetting investments, particularly in developing countries or emerging markets. Novartis has so far embarked on two external carbon-offset projects designed to fulfill requirements of the UN Clean Development Mechanism. Land has been purchased in Latin America for afforestation of pasture land to sequester carbon. In 2007, Novartis purchased 34 square kilometers of pasture land in Argentina as the site of an afforestation project to sequester carbon. So far, 1 880 hectares have been planted. Ultimately, the goal is to establish a sustainable mixed forest with 75% native tree species. In February 2008, the Forest Stewardship Council certified the afforestation project.

A second carbon-offset project sponsored by Novartis is a jatropha plantation and bio-diesel project in Mali, West Africa. The seeds of this shrub contain a high proportion of oil that can be used for pressing oil or making biodiesel fuel, as well as producing a natural fertilizer and electricity from the residues. During 2007, 350 hectares of jatropha were planted at three locations and an additional 1000 hectares were planted during 2008. The two projects are in the course of validation for registration under the UN Clean Development Mechanism.

Land-use carbon-offset projects have been relatively uncommon to date. But they are attractive to Novartis as platforms that can foster long-term economic growth for the local population, while also helping to meet the Group’s CO₂ reduction target.