Independent governance body to oversee carbon offsets market
Published July 21, 2021
Scrutiny of the market for voluntary carbon credits – or carbon offsets – is likely to become more rigorous following the announcement of the creation of an independent governance body.
The Taskforce on Scaling Voluntary Carbon Markets has announced it is to recruit an independent governance body for the voluntary carbon credit trading market. The governance body will ensure the offsets market serves its purpose of reducing carbon dioxide emissions rather than greenwashing companies’ sustainability performance.
The governance body is one of the steps described a new report on the creation of the voluntary market for the trading of carbon credits. The report follows a public consultation, attracting more than 130 responses.
The governance body will be formed by the end of 2021. Its responsibilities will include setting the legal principles to guide the market and the criteria for carbon credit integrity – the Core Carbon Principles (CCPs). It will also attempt to unify the currently fragmented market.
The governance body will be independent of the Taskforce. Overall, it is intended that the governance body will work to standardize the voluntary carbon market’s operations and unify the market behind a consistent set of values and standards.
The body will also provide oversight over standard setting organizations on adherence to the CCPs and coordinate the work between individual bodies within the carbon market.
Cynthia Cummis, Director of Private Sector Climate Mitigation, WRI and SBTi Steering Committee Member, commented: “Today, demand in the voluntary carbon market is held back by a lack of a high-quality standard for credits. Corporate buyers are concerned about the environmental and reputational risks connected with the purchase of credits. The work of the Taskforce is playing an important role to advance efforts to increase carbon credit quality and drive climate action, beyond abatement, on the path towards net zero.”
Matthew Roberts, sustainability consultant at Alfa Energy added: “This is an important initiative. Carbon credits are essential if we are to get to net zero. It’s fanciful to think we’ll get there without them or some form of regulation to ensure they do what they’re intended to do. The question is, are the carbon reductions genuine and additional and not a form of greeenwashing? There’s a strong incentive to get it right, so people have confidence in it. Having said that, offsets shouldn’t be your first port of call. There are hard-to-decarbonise parts of the economy, so it’s better to have them.”
Core Carbon Principles
Private Sector Climate Mitigation
SBTi Steering Committee
Voluntary Carbon Markets