The “Net” of “Net-Zero”: Making Voluntary Carbon Markets Work

Hear from William McDonnell, COO of the Integrity Council for the Voluntary Carbon Market, as we discuss the role of carbon credits in the transition to net-zero, and what changes are needed to ensure that the voluntary market can function correctly.

Sign up for GARP’s 2022 Climate Risk Symposium here!

Part I: Nov 22, 1:00 - 2:30 pm GMT
Part II: Dec 1, 1:00 - 2:30 pm GMT

As firms’ climate ambitions steadily rise, many are looking towards carbon credits to help ease themselves into the transition to net-zero. According to the Ecosystem Marketplace, the global voluntary carbon market (VCM) has quadrupled in value since 2020.

However, not all carbon credits are created equal, and this is causing significant harm to the VCM’s integrity. Because the quality assurance of carbon credits relies on a patchwork of standards set by independent organizations, many are of poor quality and can even be net-carbon positive. This immaturity in the market has even allowed for such irrational practices as deliberately cutting down forests, only to sell their regrowth as offsets.

In this episode of the GARP Climate Risk Podcast, we’ll examine the voluntary carbon markets, exploring:

• The key differences between the mandatory and voluntary carbon markets;
• The challenge of scaling up the voluntary market whilst ensuring credit quality; and
• How the newly formed Integrity Council for the Voluntary Carbon Market plans to address it.

Links from today’s discussion:

• Integrity Council for the Voluntary Carbon Market (ICVCM) homepage
• GARP’s first Climate Risk webcast, featuring William – The Heat is On: A CRO’s Perspective on Climate Change
• CRO Forum’s Emerging Risk Initiative 2022 update
• Voluntary Carbon Market Integrity Initiative (VCMI) homepage
• Science Based Targets initiative (SBTi) homepage

Speaker’s Bio(s)

William McDonnell, COO, Integrity Council for the Voluntary Carbon Market

William is COO for the ICVCM, the new global governance body to set and enforce threshold quality standards for the voluntary carbon market. Prior to that he had a 25-year career in financial services. Most recently he was Group Chief Risk Officer and member of the Group Executive Committee for RSA Insurance Group plc for 7 years, responsible for Risk, Assurance and Compliance groupwide. Prior to RSA he held roles at HSBC Investment Bank, Aviva, the UK Financial Services Authority and Deloitte.

William is a leading voice on climate risk in the financial sector, having served as a member of the ClimateWise Council and of the UK’s Climate Financial Risk Forum, and as chair of the Emerging Risks Initiative of leading global insurers, publishing a major climate study ‘The Heat is on – Insurability and Resilience in a Changing Climate’.