The UK government has outlined six principles which aim to improve the integrity of voluntary carbon and nature markets (VCNM). These principles address concerns about the quality of some credits in the market and their use in environmental claims.
In early 2025, the government will consult on how these principles should be implemented and enforced through “guidance, standards, and regulatory oversight.” This signals that these principles could form the foundation for future regulation.
What are voluntary carbon and nature markets?
VCNMs are systems where businesses and individuals voluntarily buy carbon or environmental credits. These credits help offset emissions or support projects that reduce carbon, protect habitats, or promote biodiversity.
What are the UK government’s six principles for high-integrity carbon and nature credits?
Use credits in addition to ambitious actions within value chains
Credits should supplement, not replace, efforts to reduce emissions within value chains. They should be part of a science-based strategy to meet climate and nature targets.
Use high integrity credits
Credits must meet recognised standards of integrity. This ensures they deliver real, measurable environmental benefits and are independently verified.
Measure and disclose the planned use of credits as part of sustainability reporting
Companies should disclose how they use (or plan to use) credits, including details about the projects supported, certifying standards, and the resulting impacts.
Plan ahead
Organisations should set long-term science-aligned targets for net zero and disclose clear plans for achieving them, including how carbon credits will support these efforts.
Make accurate green claims using appropriate terminology
Claims involving the use of credits, such as “carbon neutral” or “biodiversity positive,” must be accurate and clear, ensuring organisations do not mislead stakeholders.
Co-operate with others to support the growth of high-integrity markets
Buyers should work with others in the VCNM space to promote standardisation, improve transparency, reduce costs, and ensure fair access.
Who do these principles apply to?
These guidelines apply to any organisation or entity involved in VCNMs, including those using credits in sustainability reporting. They are especially relevant for businesses aiming to make credible green claims, align with environmental goals, and build trust with stakeholders.
By adopting these principles, organisations can help create a more reliable and transparent market, demonstrating their commitment to environmental integrity.
What happens next?
In early 2025, the Department for Energy Security and Net Zero will issue a public consultation to gather feedback on strengthening VCNM integrity.
The consultation will focus on:
- Defining standards for high-integrity markets.
- Exploring how these standards can shape policies, regulations, and guidance.
- Refining the six principles and inviting feedback on their implementation.
For advice on the upcoming policy changes and how your organisation can apply best-practice principles in the purchasing of VCNMs, get in touch with the ESG team at Sustainable Energy First.