JPMorgan Outlines Voluntary Carbon Market Principles

In a recently published white paper, JPMorgan outlined its approach to improving and strengthening voluntary carbon markets to promote scalable decarbonization efforts. JPMorgan focused its analysis on voluntary carbon markets, i.e., markets where "companies or individuals to purchase carbon credits to meet their own emissions goals" independent of markets "created and regulated by mandatory international, national or regional carbon management regimes," (i.e., compliance markets). JPMorgan also cautioned that voluntary markets are "not a substitute for robust public policies designed to address climate change."

Under JPMorgan's analysis, carbon markets provide benefits to the global effort to reduce carbon emissions beyond those offered by regulatory programs for three major reasons. First, they allow companies in industries that face challenges in reducing their carbon emissions where, for instance, "the technologies necessary to address emissions may not yet be