 Let's listen to Annette Nazareth. It is my pleasure to open this panel about how can carbon credits contribute to net zero at the 2023 World Policy Conference with you today, Annette Nazareth. You are chairing the board of the Integrity Council for the Voluntary Carbon Market. What would you say are the main challenges of the Voluntary Carbon Market right now and how is the Integrity Council role in that context? Well, first, thank you so much for inviting me to speak with you today. I'll speak of the challenges first. I'm very excited about the possibility, so I'll get the challenges out of the way. I think it's very, very clear that we have an enormous challenge in fighting climate change. We have a shared goal that really transcends markets, sectors, portfolios, and geographies. This is a critical moment in our history. And so the scale and urgency of the crisis really demands that we use every available tool. And as you know, we have emissions reductions as a centerpiece of this, and that is entirely appropriate. Carbonization by corporates of their own operations and supply chains must be a priority. But unfortunately, it's too late now just to rely solely on corporate internal emissions reductions or even government action. And that's where the voluntary carbon market comes in. We have to accelerate our transition to net zero by using every tool in the toolbox. It's as UN Secretary General Gutierrez has said recently, we need everything everywhere and all at once. And so the voluntary carbon market can be a really important solution. But, and we're very, very focused on this only if it is rooted in high integrity. It holds the power to unlock urgently needed finance that would not otherwise occur and or otherwise be available for projects without voluntary carbon credits and to quantify the opportunity. The World Economic Forum has projected that the voluntary carbon market could remove 2.6 gigatons of CO2 by 2030. And Morgan Stanley projects that it could reach almost 100 billion in volume by 2030. So the integrity council for the voluntary carbon market is an independent governance body committed to establishing high integrity voluntary carbon markets that can deliver real impact at speed and scale. And as I said earlier, it has the power to unlock private capital for projects to reduce and remove billions of tons of emissions that would not otherwise be viable. The other exciting thing is that it can channel funding to countries in the global south and help develop vibrant green economies. And it will support sustainable development goals by requiring all new projects to make a positive contribution to sustainable development as well as having robust measures to protect people and the environment. But we know that today it's a relatively nascent market. It's unregulated and if it's to scale and to live and to deliver on its climate goals, we need to address some of the critical issues that have arisen. So today the quality of credits in the market is at best inconsistent. Trading is fragmented and opaque and not all carbon crediting programs impose consistent high quality standards. So ultimately it's fair to say that the voluntary carbon market today doesn't consistently meet the expectations of purchasers or the urgent needs of our planet. And this is a significant problem that limits the full potential to meet our climate goals. So we think we need to address a number of things. One is certainly standardization. Carbon crediting programs each have their own methodologies. They have differing rules of engagement and highly bespoke transactions that don't provide an environment for liquidity and transparency. Indeed, they create challenging market impediments. So we've created a global benchmark for high integrity carbon credits. The integrity council recently published the CCPs. Could you give us more color about the CCPs? Sure, I'd be happy to talk about the CCPs and importantly how they underpin integrity. There are 10 core carbon principles and they fall into three categories. Those that relate to emissions impact to governance and to sustainability. You know, it's really important that buyers have confidence that carbon credits are making genuine impacts on emissions. Carbon credits must fund reductions or removals that are additional, meaning that they would not have occurred in the absence of the incentive created by the carbon credit revenues. They have to be permanent. They have to be measured robustly and conservatively, and they can only be claimed by one party, which means there's no double counting of the credit. Programs that issue the credits also must meet high standards of governance to ensure that the overall quality of carbon credits is high. They have to provide comprehensive and transparent information on the projects, issuing the credits so that people understand their impact on emissions, society and the environment. They have to use a registry that uniquely identifies and tracks each credit from issuance to retirement or cancellation. And they have emissions reductions or removals verified by independent third party experts. And importantly, the CCP's also break new ground by requiring programs to ensure that high integrity credits come from projects with robust social and environmental safeguards that also deliver positive sustainable development impacts. That is, they make sustainable development a central part of the mitigation activity, not just a co-benefit. They must also support the transition to net zero and not lock in fossil fuel emissions or technologies. So in July, we published our CCP rulebook, which sets out the rigorous criteria we use to assess whether programs and categories of credits meet our high integrity threshold. Programs that we approve will be able to use the CCP label on credits provided they have come from categories that we have also approved. So what do you see also on the corporate side, right? On the demand side, what do you see on the critical path to improve the voluntary carbon market? Well, on the corporate side, it's important not only that we offer a supply of very high integrity carbon credits, but that corporates are using carbon credits appropriately. And so the demand side of the equation is also critically important and we're working very closely with what we call our sister organization, the voluntary carbon markets integrity initiative. And VCMI is focused on the appropriate use of credits. So basically at the integrity council, we're focused on the supply of credits and also on the ensuring that the markets on which they trade are high integrity. And of course, we're looking at market mechanisms such as transparency and trade reporting and settlement issues. But VCMI is then focused on the demand side. So we like to say that together we are creating end to end integrity in the voluntary carbon market. That's important because that's working from supply to demand. So when looking forward, what would success look like for the integrity council? How will you measure it? Well, of course, we're very interested in seeing the market scale up. As I've said, we don't want to scale the market unless it is rooted in high integrity, but we believe that there's enormous potential. And so, and in fact, we know that there's demand for high integrity products and thus we expect them to trade at a premium. And trading at a premium, of course, would create powerful incentives for project developers to enhance their practices to come in line with our core carbon principles. And we expect the CCP's to drive continual improvement in the quality and impact of carbon reduction projects, ensuring that the market's contribution to emissions reduction aligns with the urgency of the climate crisis. I think the CCP's will also establish standardized criteria that will drive a shift towards increased transparency, but also exchange based trading. Because when we have greater standardization, I believe a larger proportion of carbon credit trading will transition from what we have today, which is uniformly bilateral agreements to transactions conducted through exchanges. And this transition would not only enhance market efficiency, but will also provide a platform for buyers and sellers to engage in transparent and fair pricing, which would drive broader market participation and liquidity. I mean, I should note when we talk about standardization, I've often been asked, well, what are the CCP's to some extent, you know, what can you analogize to that I understand. And I like to say that the CCP's are akin to listing standards. It's as if we've imposed traditional regulatory principles onto the voluntary carbon market. So if you think of these CCP's as listing standards, the other element of them is that they also require not just a focus on essentially self regulation of the product by the listing standards, but also self regulation of the programs that issue the credits. And so bringing those principles to the market, I believe will create greater confidence in the market just as we have confidence in other high integrity, robust capital markets. And that's what we're seeking. We're seeking confidence, justifiable confidence based on high integrity. Frankly, we also expect robust trading of futures on voluntary carbon markets as the markets become more standardized. And that I think will create very important price signal because it will improve hedging mechanisms for market participants. It will provide important price signals. It will also give project developers better ability to manage their exposure to price risk. And this I think will make it less risky to launch new projects again, particularly in the global south. So by implementing the core carbon principles and encouraging market participants to embrace these high integrity credits, we're creating an ecosystem where the value of emissions reductions are appropriately recognized and rewarded. And this will unlock, I believe, greater capital flows and drive innovation and catalyze the development and deployment of truly impactful climate solutions. Thank you, Annette. This is really very insightful and no doubt we're looking forward to the success of this entire ecosystem effort because that's what we're talking about for the benefit of, of course, climate change and in general mankind. Thank you very much for your participation. It's been a pleasure. Thank you.