Powering climate action: Unlocking voluntary carbon markets to drive impactful change

Environment and sustainability

Powering climate action: Unlocking voluntary carbon markets to drive impactful change

• 6 November 2025

Share this:

• New windowShare on Linkedin
• New windowShare on X
• New windowShare on Facebook
• New windowShare on Email

Businesses are central to the global climate response. With the scale and influence to accelerate meaningful progress, they play a pivotal role in advancing the climate transition. But ambition alone is not enough. Achieving net zero requires effective frameworks to channel investment into climate solutions that deliver real impact. Voluntary carbon markets (VCMs) provide a path forward. They allow companies, governments and individuals to purchase verified carbon credits to offset or compensate for their own greenhouse gas (GHG) emissions.

The ICC-commissioned Oxera report explores how governments and policymakers can build on existing progress to strengthen the integrity and functionality of voluntary carbon markets. It sets out 14 targeted recommendations aimed at mobilising private finance for climate action and creating the conditions for businesses to invest credibly, confidently and at scale.

As the official UNFCCC Focal Point for Business and Industry, ICC will draw on these insights to inform dialogue with governments and negotiators at COP30.

Voluntary carbon markets have significant potential to channel investment into emission reduction and removal projects

When built on transparency, integrity and strong standards, voluntary carbon markets offer a practical way for businesses to go further, faster. They complement direct emissions cuts by supporting high-impact projects that protect forests, restore ecosystems and advance clean technologies. In doing so, they direct much-needed climate finance to vulnerable regions and communities while delivering wider social and environmental benefits.

Policy recommendations

To scale VCM integrity and mobilise private climate finance, this report sets out 14 targeted recommendations organised across five themes, connected to clear government actions and complimented by case study insights.

Theme 1: Strengthening supply-side quality, transparency and integrity addresses the primary challenge undermining market confidence -uncertainty over whether credits represent genuine emissions reductions. By establishing clear government frameworks, transparent registries, and credible oversight, these measures enable buyers to identify high-quality projects with confidence, reducing greenwashing risk and rebuilding trust in the market.

• Recommendation 1: Establish clear national frameworks for project authorisation in line with Integrity Council for the Voluntary Carbon Market principles to improve project quality
• Recommendation 2: Endorse or set robust domestic standards and registries aligned with ICVCM principles to improve credit quality.
• Recommendation 3: Promote open registries and data transparency, including disclosure of methodologies, monitoring results, and retirement data, to improve understanding of quality for businesses
• Recommendation 4: Promote independent verification and robust governance to prevent conflicts of interest.
• Recommendation 5: Strengthen oversight of carbon-credit rating and integrity agencies to improve clarity over ratings for businesses.

Theme 2: Supporting demand-side investment and integrity tackles how credits are used and claimed by businesses. Clear government signals on when and how credits should be purchased - integrated into national climate strategies and aligned with best practice - reduce uncertainty, counter greenwashing accusations and unlock corporate investment by clarifying acceptable use cases within net-zero strategies.

• Recommendation 6: Integrate VCMs into national climate strategies to encourage VCM participation.
• Recommendation 7: Provide guidance or mandates on appropriate use of credits to reduce the risk of greenwashing.
• Recommendation 8: Clarify legal and accounting treatment of credits, and their relation to NDCs and corresponding adjustments to promote appropriate usage of credits

Theme 3: Improving financial market infrastructure enables transparent pricing and efficient trading. Better post-trade transparency and proportionate regulation of intermediaries lower transaction costs, improve price discovery and support the development of standardised contracts and derivatives - crucial for enabling developers and buyers to manage risk effectively and to scale investment.

• Recommendation 9: Introduce measures to improve post-trade transparency from exchanges and brokers to improve price discovery, reduce uncertainty, and build investor confidence in credit valuation.
• Recommendation 10: Introduce light-touch, proportionate regulation of intermediaries and market infrastructure to support fair and efficient trading

Theme 4: Establishing clear legal and recourse frameworks provides the legal certainty and remedies needed to attract capital. Independent dispute resolution and targeted insurance protect both buyers and developers when projects underperform or credits are challenged, reducing perceived risk and enabling confident, long-term participation.

• Recommendation 11: Establish or promote formal and independent process for dispute resolution to provide buyers with certainty and confidence.
• Recommendation 12: Encourage market participants to purchase relevant insurance for risks that may affect projects or credits such as reversal risk or underperformance, to provide buyers and project developers with certainty and encourage market participation.

Theme 5: Enabling interoperability with compliance markets prevents double counting and - once quality is assured - creates pathways for high-integrity voluntary credits to contribute toward compliance obligations. This unlocks additional demand from regulated sectors, reduces market fragmentation, and channels finance at the scale needed to close the global mitigation gap.

• Recommendation 13: Support effective and equitable implementation of Article 6 to prevent double counting and build trust.
• Recommendation 14: Should VCMs reach a sufficient level of quality, enable greater interoperability between compliance markets and VCMs to increase investment in VCMs .