Under pressure from customers and investors, many U.S. companies have pledged to voluntarily reduce their impact on the climate. But that doesn’t always mean they’re cutting their own greenhouse gas emissions.

A large number of companies are instead paying others to reduce carbon emissions on their behalf through projects that generate carbon offsets.

There are reasons for skepticism about this practice. Chief among them is that projects developed for carbon offsets have a history of taking up land in poorer countries, displacing small-scale farmers and threatening livelihoods in the process. The quality of some globally traded voluntary offsets has also proven challenging to verify. Investigations of forest-offset projects, for example, have suggested that many aren’t as effective at sequestering carbon as they claim.

We think there is a better solution: Companies could spend some of their carbon-offset money on climate-friendly projects that don’t just cut emissions but also improve people’s lives in the U.S. communities where these companies operate.