ISDA CEO Urges Legal Framework for Voluntary Carbon Markets

ISDA CEO Scott O'Malia urged further adoption of measures to facilitate a robust trading environment for voluntary carbon markets.

In comments on ISDA's derivatiViews blog, Mr. O'Malia noted recent measures taken by ISDA, including the publication of standardized documentation for trading verified carbon credits, but stated further steps are needed by market participants and governments to provide for a robust legal and regulatory framework. On establishing a robust framework, Mr. O'Malia cited recent ISDA white papers that (i) explored key issues for authorities in the UK, U.S. and Germany and in France, Japan and Singapore, (ii) identified how to address legal obstacles in voluntary carbon markets and (iii) emphasized the importance of standardized documentation for creating certainty in the markets.

Mr. O'Malia also urged market participants to look to means for assurance that projects being supported have "a genuine and verifiable impact on carbon reduction," such as the core principles published by the Integrity Council for the Voluntary Carbon Markets.