Cop28: world’s voluntary carbon markets need to eliminate dubious claims to lift trading volumes, win back public confidence

A global benchmark authority has proposed that global securities regulators should consider oversight of the voluntary carbon markets (VCMs) to help rebuild public confidence. This comes after the credibility of this powerful tool for climate change mitigation was damaged by integrity and trust issues. The International Organization of Securities Commissions launched a three-month public consultation programme on a set of proposed 'good practices' to promote the integrity and orderly functioning of the currently unregulated VCMs.

These proposals were outlined in a consultation report published during the ongoing Cop28 United Nations climate change conference in Dubai. The details of a multilateral carbon credits trading scheme overseen by a new UN body will be negotiated at this conference. This 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, said in a statement. 'But, for these markets to succeed, they need integrity – both environmental and financial. IOSCO and its international market expertise will be key in promoting financial integrity and building the trust these markets need to scale.