Companies are increasingly relying on carbon credits to offset greenhouse gas (GHG) emissions or support climate goals. Many companies are looking to buy environmentally credible carbon credits that represent a measured ton of reduced or sequestered GHG. However, the absence of clear guidance on the quality of credits makes it difficult to take investment decisions.
This is particularly true for forest carbon credits that operate within socially and environmentally complex contexts and are less straightforward in their evaluation than credits generated by projects in the energy or industrial sectors. While investors will conduct their own due diligence, this paper seeks to provide some initial guidance on the technical features, advantages, and risks of different carbon standards.