Not enough FTSE companies have embraced carbon neutrality, research from environmental research agency Trucost has shown.

The need for carbon management has been accepted by many business leaders and 28 out of 557 companies in the FTSE All-Share index have become carbon neutral or are offering carbon-offsetting mechanisms to their customers. Although this is an increase from 15 companies in 2004 it still represents only 5% of the FTSE All-Share.

This is one of the key findings from Trocost’s report “Carbon Neutrality and Carbon Offsetting in the FTSE All-Share 2007”. The report found that the scope of carbon neutrality and offsetting varied significantly, as only 11 out of the 28 companies aimed to be carbon neutral for their entire operations. The remainder have only investigated carbon neutrality for part of their operations or offered offsetting facilities to their customers.

Julie McDowell, head of socially responsible investments at Standard Life Investments, said: “While the number of companies seeking carbon neutrality has increased, it remains small. Negative media scrutiny of offsetting mechanisms may have slowed the adoption of carbon neutrality. On the plus side it has also spurred efforts by Government and others to develop credible standards for voluntary carbon offset programmes, which are urgently needed.”