Building Trust In Investments

When I speak to buyers of carbon credits, here’s what’s in greatest demand: #trust They are crying out for it. Given previous scandals, they’re very aware how easily they could be caught holding poor-quality credits. We as a sector have let them down. But I believe the #FirstPrinciple answer is simple - albeit an oxymoron - to trust carbon credits, build systems that don’t rely on trusting us. Generally, carbon project developers are great people trying to do amazing things. By and large, we are not bad actors. But we shouldn’t be trusted. We have an inherent conflict of interest in the returns of the project to our investors, teams and partners that weighs us down constantly. It's not easy carrying this weight - the temptation to believe what we want to hear or turn a blind eye is strong. But a trustless goal isn’t aspirational - it’s already happening and why carbon is now clearly a #Kshaped market. Those performing well, like ATEC Global, have robust & independent baseline science combined with project technology such as 100% IoT that means you don’t need to trust us in order to trust our carbon credits. But if as a sector we keep the bar low, allowing developer-controlled assumptions, sampling and conflicts of interest, we will set ourselves up for another market cycle crisis. So let’s build a complete sector that doesn’t rely on trusting us. Then our buyers will finally be able to trust our carbon credits - and an exciting future awaits.

Did you know that weak measurement and verification systems can undermine the credibility of entire sustainability and climate programs? Recent analysis by Senken of more than 2,300 carbon projects found that in some categories, fewer than 16% of issued carbon credits corresponded to real emission reductions, highlighting the risks of inadequate monitoring and verification systems. At the same time, global climate finance and carbon markets depend on rigorous Measurement, Reporting, and Verification (MRV) processes; because one verified carbon credit represents one tonne of greenhouse gas emissions reduced or removed, a unit that governments, investors, and institutions rely on to track real progress. These numbers reinforce a simple but critical lesson: credibility in sustainability is built on systems, not promises. In practice, this means investing in robust monitoring frameworks, conducting independent compliance audits, and ensuring that data can withstand scrutiny from regulators, financiers, and stakeholders. Organizations that prioritize these systems are not only better prepared for evolving disclosure requirements, they are also better positioned to attract investment, manage risk, and deliver measurable impact. As sustainability expectations continue to rise globally, the institutions that will lead are those that understand that accountability is not an administrative requirement; it is a strategic asset. Because in sustainability and climate action, what gets measured, verified, and audited is what ultimately builds trust and delivers lasting results.

𝗧𝗿𝗮𝗻𝘀𝗽𝗮𝗿𝗲𝗻𝗰𝘆 𝗶𝘀 𝗵𝗼𝘄 𝗰𝗮𝗿𝗯𝗼𝗻 𝗺𝗮𝗿𝗸𝗲𝘁𝘀 𝗲𝗮𝗿𝗻 𝗯𝗮𝗰𝗸 𝘁𝗿𝘂𝘀𝘁. 𝗔𝗻𝗱 𝗶𝘁'𝘀 𝗳𝗶𝗻𝗮𝗹𝗹𝘆 𝗯𝗲𝗰𝗼𝗺𝗶𝗻𝗴 𝗿𝗲𝗮𝗹. For too long, the voluntary carbon market operated with limited visibility. Project quality, credit integrity, and how claims were being made were difficult to assess. That created risk for buyers, policymakers, and the market as a whole. That's changing. A new generation of market infrastructure is making quality differences easier to identify: ✅ Independent rating systems are distinguishing high-integrity credits from weak ones e.g. Sylvera, Calyx Global and BeZero Carbon ✅ Registry data is becoming more publicly accessible ✅ Digital monitoring, reporting and verification tools – based on satellites, drones, LIDAR, and ground checks – are raising the bar on project quality ✅ Disclosure expectations are growing for corporate credit users, e.g. in California When quality is easier to evaluate, strong supply becomes easier to find. That's how transparency shifts incentives: not through mandates alone, but by making the high integrity and quality visible. For policymakers, buyers, and investors, the implication is clear. Investing in data infrastructure, verification capacity, and disclosure frameworks isn't a side issue. It's central to whether carbon markets can function as credible climate tools. Transparency is not a nice-to-have. It's the mechanism through which trust is built and carbon markets can start to play the role they need to play in overall climate action. #CarbonMarkets #ClimateTransparency #ClimatePolicy #VCM VCMI The Integrity Council for the Voluntary Carbon Market (ICVCM) Mark Kenber Gabriel Labbate Allister Furey Donna Lee IETA Ecosystem Marketplace Steve Zwick

𝗔 𝗰𝗵𝗲𝗮𝗽 𝗰𝗮𝗿𝗯𝗼𝗻 𝗰𝗿𝗲𝗱𝗶𝘁 𝗰𝗮𝗻 𝗯𝗲𝗰𝗼𝗺𝗲 𝗮𝗻 𝗲𝘅𝗽𝗲𝗻𝘀𝗶𝘃𝗲 𝗯𝗼𝗮𝗿𝗱 𝗽𝗿𝗼𝗯𝗹𝗲𝗺 Many companies in Malaysia and ASEAN are now asking the same question: “Can we use carbon credits to close the gap?” That is not the best starting point. The better question is: “Which credit is fit for which claim, risk exposure, and stakeholder expectation?” 𝗧𝗵𝗲 𝗿𝗲𝗴𝗶𝘀𝘁𝗿𝘆 𝗺𝗮𝘁𝘁𝗲𝗿𝘀. ✅ 🔗 Verra, Gold Standard, ACR, Puro.earth, Plan Vivo, and Isometric are not interchangeable shelves of credits. They reflect different assumptions around project type, methodology, additionality, co-benefits, transparency, permanence, and auditability. A nature-based credit linked to community and biodiversity outcomes should not be treated the same way as an engineered carbon removal certificate. A broad voluntary credit should not be presented internally as if every tonne carries the same financial, assurance, or reputational strength. This is where materiality becomes money. For CFOs and boards, a poor registry decision can create hidden liabilities: -Overpaying for weak claims. -Under-specifying procurement criteria. -Mixing avoidance, reduction, and removal in one number. -Failing assurance review. -Making a net zero statement the business cannot defend. Before buying credits, I would ask seven questions: ▪️ What claim are we trying to make: compensation, contribution, product claim, neutralisation, or residual emissions? ▪️Is the credit avoidance, reduction, or removal? ▪️What is the permanence risk? ▪️What evidence supports additionality and uniqueness? ▪️Can the registry data stand up to audit, investor, customer, and regulator scrutiny? ▪️Are co-benefits material to our stakeholders, or just nice to have? ▪️How does this fit inside the company’s transition plan, not outside it? Carbon credits are not a shortcut around decarbonisation. They are a financing and governance instrument useful only when matched to the right business decision. The next board paper should not ask: “Which registry is best?” It should ask: “Which registry is fit-for-purpose for the claim, risk, and money at stake?” What is one carbon credit question your board or finance team should ask before procurement begins? 📸 Dr. Rupali Sharma

Carbon credits rely on one thing: #TRUST. A carbon credit isn't a tangible product; it's a quantified claim. A promise that a certain amount of CO2 was removed or avoided. A carbon credit is, for the most part, just a #digital notification. A line in a registry. A polite claim that says, “Trust me, this tonne of CO2 has been taken care of.” And in some cases, we’re told this by the same entity that designed the project, paid for it, measured it, verified it, and is now trying to sell it. In emerging carbon markets, we are increasingly seeing conflicts of interest, where a single institution acts as project #funder, technical #validator, and credit #seller. When roles blur, trust collapses. Without independent checks, carbon markets risk becoming a climate finance echo chamber—self-certifying, opaque, and easily manipulated. The London School of Economics and Political Science (LSE) Grantham Institute’s report—“Corruption and Integrity Risks in Climate Solutions”—lays this out in clear terms. It identifies systemic #governance risks across mitigation finance, including: ❗ Lack of institutional separation in project pipelines, ❗ Weak regulatory oversight, ❗ Politicization of carbon methodologies, ❗ And opaque fund flows between public institutions and credit platforms. #Policymakers and credit issuers must act now to safeguard environmental and market integrity. This includes: ✅ Establishing firewalls between funders, certifiers, and brokers; ✅ Enforcing independent third-party verification and MRV; ✅ Prohibiting credit issuance for projects already funded via national mandates or NDCs unless corresponding adjustments are applied; ✅ Public disclosure of all co-funding sources and methodologies. The future of climate finance depends not only on carbon being removed but also on claims being #credible, #auditable, and #fair. I have attached a screenshot of a figure from the report as a reference. For those who are interested in delving deeper into the report, please find the link below. 📜 Corruption and Integrity Risks in Climate Solutions: https://lnkd.in/dyuCDySP #CarbonMarkets #ClimateFinance #Additionality #MRV #ICVCM #ESG #Greenwashing #Article6 #CarbonCredits #ConflictofInterest #PublicIntegrity #ClimateGovernance #TrustInMarkets #SustainabilityPolicy #EnvironmentalIntegrity #ClimateTransparency

There's one thing carbon Standards / Registries need to do well at minimum--everyone should trust them. If there are backup measures to make sure their carbon credits are solid (e.g. using buffer pools, etc.), I want to see Standards (and Projects) use them to make corrections. Use it early and use it often! Admitting a correction is needed and "paying out" the difference is a reminder they can be trusted, not the other way around. At the end of the day, physical carbon accounting is fundamentally science and decisions. And the science, tools, best practices, and expectations are improving all the time! Standards need to reflect this reality and consistently and regularly be super explicit about all the things they are correcting and improving. How else will we trust the system long term? Although Verra has accomplished many challenging firsts and has the potential to do a lot of good going forward, there needs to be a reason to trust their older projects and credits (3 points below). It's not just Verra, every Standard needs to earn and keep our trust. Verra is the just the most salient example right now. Fundamentally the past over-crediting Verra admits to with the much maligned Kariba project: (1) needs to pass the sniff test. There's quite a distance between what Verra concluded is over-credited versus third party experts, and I don't get the sense that many trust the final number, (if you're not truly addressing the market's trust, why take these steps now at all?). Also note, I don't care if Verra is right if it doesn't address the perception that it is wrong. That is building trust. (2) is too slow. Timeline does matter! Taking years to figure out if credits are legit is just a cloud of distrust following buyers around the whole time. Regardless of if or how the developer makes up for credits, use the buffer pool for crying out loud! If it's not going to be used in extreme circumstances like this then why should anyone trust it will ever be used? (3) is an opportunity to change. Verra needs to admit lessons were learned and change to be pro-active about systemic problems to rebuild trust. Clean up the old projects to meet with current best practices, it's brutal work and may even bankrupt the organization, but the other option is to simply decline. Thanks Jim Giles for capturing the different views here: https://lnkd.in/g_mzc7s6