SUSTAINABLE FINANCE
Carbon credits are controversial. With concerns about effectiveness and a lack of transparency, critics are worried that they could be misused for corporate greenwashing. This has led to some companies steering clear and carbon markets standing relatively still.
However, the World Resources Institute says that carbon removal will be required to counterbalance remaining emissions that cannot be abated on the journey to net zero. Without investment, carbon credits could struggle to scale and truly become an effective mechanism for protecting the planet.
In a report published at the beginning of 2025, MSCI suggested that it expects the“ frozen” carbon market to thaw. With increasing corporate climate commitments and evolving market mechanisms, MSCI believes the sector could experience a resurgence by 2030.
“ Carbon credits have come a long way since their inception in the late 1980s. From early offset programs to today’ s dynamic voluntary markets, the path has been shaped by pivotal milestones like the Kyoto Protocol, the EU Emissions Trading Scheme and the Paris Agreement,” said Jeremy Davis, Executive Director at MSCI.
With big companies like SAP, Microsoft and Google not just getting on board with carbon credits, but talking about them, carbon markets could be set to soar.
sustainabilitymag. com 179