Cop28: world’s voluntary carbon markets need to eliminate dubious claims to lift trading volumes, win back public confidence
- Absence of high-quality data and lack of oversight on credits issuance and monitoring, are some of the hurdles to regulating carbon markets
- A robust carbon credit trading system has implications for Hong Kong, which is rolling out the world’s biggest climate mitigation market in China
Global securities regulators should consider oversight of the voluntary carbon markets (VCMs) to help rebuild public confidence, after credibility in this powerful tool for climate change mitigation was damaged by integrity and trust issues, a global benchmark authority proposed in a report released this week.
They were outlined in a consultation report published during the ongoing Cop28 United Nations climate change conference in Dubai, where details of a multilateral carbon credits trading scheme overseen by a new UN body, will be negotiated.
The scheme will allow countries and companies to buy credits earned on emission mitigation projects abroad to meet their own reduction goals.
“Voluntary carbon markets have gained significant importance in recent years,” Rodrigo Buenaventura, chair of the IOSCO sustainable finance task force and chairman of Spain’s securities watchdog CNMV, said in a statement.