Voluntary Carbon Markets

Carbon crediting and trading programs have operated independently of the UNFCCC for decades. Today most voluntary carbon emissions credits are still traded directly by companies seeking to claim they are offsetting their emissions through the purchase of credits, credits which are supposed to be verified by independent auditors.

But in practice, voluntary carbon markets have struggled with scale, integrity, and perception problems.

Scale: Predictions of an enormous market by 2025 have not borne out – primarily because of the problems associated with credit verification and integrity.

Integrity: The Integrity Council for the Voluntary Carbon Market (IC-VCM) is one of several initiatives trying to attract more buyers into the carbon markets by creating standards for higher quality credits. Meanwhile, the International Civil Aviation Organization (ICAO), in collaboration with the big airlines, announced a plan to ‘offset’ growth in air travel emissions through extensive use of carbon credits in a program called CORSIA. But CORSIA has accepted, for crediting purposes, the use of verification authorities that are not recognized as high-integrity. So there is downward pressure on standards at a time when the airlines represent a huge new market for credits.

Perception: At some point in the past, offsets brought reputational gain. The ongoing critique of the quality and integrity of carbon offsets – including lawsuits challenging corporate claims based on the purchases of offsets -- has instead brought reputational and legal risk to companies.

The CLARA network and CLARA members have commented on different aspects of the VCM debate. Links are organized below in relation to key topic areas.

VCMI

In 2022, CLARA sent an ‘open letter’ to the Voluntary Carbon Market Initiative attempting to set standards for ‘high-quality’ carbon credits. CLARA members were uncomfortable with both the content of the Draft Code for certifying ‘high quality’ credits, and the ways in which that standard was created, primarily by market actors keen on trading carbon.  These failures of integrity led us to publish the open letter.

See CLARA’s open letter to VCMI here

REDD+

CLARA has consistently taken the position that REDD+ is best viewed as a set of non-market activities intended primarily to empower local rightsholders and stakeholders to protect and restore forests in ways that guarantee sustainable livelihoods. The ‘carbon counting’ function of REDD+ should be the secondary goal.

CLARA and Carbon Market Watch collaborated on a 2024 Briefing outlining the differences between UN REDD+ and Article 6.2. It details the disconnect between working examples of REDD+ programs and the push to include REDD+ in Article 6 carbon-market mechanisms, and highlights why REDD+ is incompatible with offsetting.

Read False Friends: Why UN REDD+ and Article 6 Carbon Markets are Incompatible

Corporate Climate Responsibility Monitor 2025

New Climate Institute and Carbon Market Watch analyzed the climate strategies of 55 major global companies, assessing their corporate climate leadership. There is clearly a need for greater transparency and accountability around offsetting claims.

Carbon Market Watch built on the findings of the 2025 CCRM to identify key trends in corporate climate claims and offer policy recommendations for voluntary standard setters and EU regulators to strengthen climate accountability, close loopholes, and align corporate action with 1.5°C pathways.