The global carbon market is at an inflection point as discussions during the recent COP meeting in Brazil demonstrated.
After years of negotiations over carbon market rules under Article 6 of the Paris Agreement, countries are finally moving on to the implementation phase, with more than 30 countries already developing Article 6 strategies. At the same time, the voluntary market is evolving after a period of intense scrutiny over the quality and integrity of carbon credit projects.
The era of Carbon Markets 2.0 is characterised by high integrity standards and is increasingly recognised as critical to meeting the emission reduction goals of the Paris Agreement.
And this ongoing transition presents enormous opportunities for financial institutions to apply their expertise to professionalise the trade of carbon credits and restore confidence in the market.
The engagement of banks, insurance companies, asset managers and others can ensure that carbon markets evolve with the same discipline, risk management, and transparency that define mature financial systems while benefitting from new business opportunities.
