Why the carbon market needs clarity, not categories

The voluntary carbon market is growing. So is the number of ratings, rankings, and provider comparisons. That is a good thing. More analysis means more transparency and puts providers under pressure to maintain high quality standards.

It becomes problematic, however, when complex realities are oversimplified. When individual data points are taken out of context. Or when market analyses are selectively mixed with competitive interests.

That is exactly why it is worth putting the current public debate around carbon credits into perspective.

What quality means for climate projects in the voluntary carbon market (VCM)

The discussion about the quality of carbon credits matters. But it is often conducted in a reductive way. A common mistake is to look at individual data points in isolation.

Example: Project ratings

Many projects are assessed by multiple rating agencies. The results of these assessments can differ because the underlying methodologies vary. The same project may receive a poor score from Rating Agency A while ranking among the best of its kind at Rating Agency B.

If an analysis only references a single rating while ignoring other ratings for the same project, the picture becomes distorted.

A credible project assessment must:

• Consider all available ratings
• Explain differences between methodologies
• Include key quality criteria (such as permanence and additionality)
• Take into account project documentation from publicly accessible registries
• Place results in the context of the overall project
• Conduct a holistic risk assessment (e.g., project design, involved parties, media coverage, and other external evaluations)
• Contextualise assessments based on the state of knowledge at the time of project development and the methodologies applicable then
• Verify whether projects meet current quality standards (e.g., CCP, CCQI, CORSIA)

Anything less is an incomplete analysis that can lead to false conclusions or high-risk decisions.

ClimatePartner assesses climate projects beyond the requirements of the respective standard setters and auditors. In addition to evaluations by independent rating agencies, our Project Integrity Team reviews every climate project before it enters our portfolio. The project integrity process creates transparency about projects, project stakeholders, and contractual partners, and helps identify potential risks early on.

For every climate project, ClimatePartner conducts a Project Integrity Screening. This includes an assessment of the project's reputation and public perception, with a particular focus on critical media coverage. Our goal is to identify projects and partnerships that companies can invest in with confidence.

Where needed, more in-depth analyses follow, such as geospatial assessments.

Example: Assessing project portfolios

A diversified project portfolio helps companies combine climate action with social, economic, and environmental benefits.

Diversification reduces risks, stabilises costs, and secures access to high-quality carbon credits. At the same time, the contribution per project should be large enough to generate measurable emission reductions and tangible impact on the ground.

Over several years, companies can support different climate projects across different regions with varying benefits for the climate, biodiversity, and local communities.

What matters is the bigger picture: the long-term climate action strategy over multiple years and not just the engagement at a single, isolated point in time.

Carbon avoidance, reduction, or removal: What creates value?

Another debate concerns the distinction between project types: avoidance, reduction, and removal.

In our view, some narratives create the impression that avoidance and reduction projects are outdated. We believe that claim is too broad.

Research does emphasise that carbon removal must grow in importance over time to achieve global net zero targets.

But that does not mean climate projects that reduce or avoid emissions have lost their relevance. Especially since project type is by no means the only quality indicator of a climate project.

Projects such as forest protection, renewable energy in underserved regions, and efficient cookstoves deliver measurable contributions to climate action and sustainable development. The Science Based Targets initiative (SBTi) is clear: reducing emissions remains the top priority for companies. At the same time, the SBTi recommends taking responsibility for ongoing emissions by financing climate projects. In the short term, companies should support projects that deliver high climate impact and create additional social and environmental benefits. This includes, for example, expanding renewable energy or forest protection projects.

What is often overlooked: the market for carbon removal is still in its early stages and significantly smaller. Projects that avoid or reduce emissions are already available at scale and well established. Carbon removal projects, on the other hand, are not yet available in sufficient volumes. To achieve the necessary climate impact, we must act now with the tools we have.

The recommendation is therefore not "removal instead of avoidance or reduction". What matters is the interplay. To create impact today while building future solutions, both approaches are needed.

Why simple categories like "old" and "new" providers say little about quality

Some analyses divide the carbon credit market into two broad groups: Legacy providers and new-generation platforms.

The quality of a climate action provider does not depend on when the company was founded. It depends on three things:

• Methodology
• Governance
• Transparency

Market experience is not a disadvantage. On the contrary: providers that have been working with projects for many years, co-developing standards, and anticipating regulatory developments early often have deeper market knowledge.

ClimatePartner has also been labelled a "legacy provider" in such categorisations. In reality, our approach is backed by 20+ years of experience in the voluntary carbon market. As a project developer, we know the reality of climate projects first-hand. We understand how complex it is to develop projects, engage local stakeholders, and ensure long-term impact. We know the requirements of standards and audits. In recent years, the market has changed, and we have changed with it. New requirements, more transparency, and critical discussions are part of a dynamic environment. What matters is how companies respond.

For us, that means: evolving, sharpening standards, and taking responsibility. Not as a "legacy provider," but as a reliable partner for climate action that delivers results.

Why differentiated market analyses matter more than simple rankings

The voluntary carbon market remains under intense scrutiny from science and media alike. This attention is important. It helps raise quality standards.

What the market does not need, however, are oversimplified categories or selective analyses. Climate action strategies are complex. Changes in the market and in methodologies are normal and necessary given evolving frameworks. Credible assessments must account for that complexity.

Quality shows in depth, not in categorisation

Whether a provider delivers good work cannot be determined by whether it is labelled new or old.

What matters is:

• How transparent its methodology is
• How rigorously projects are assessed
• How well its solutions align with future regulatory requirements

The carbon market will continue to professionalise in the years ahead. Companies that take their climate action strategy seriously need one thing above all: partners who make it manageable rather than oversimplify complexity.

At the same time, the debate around quality must strengthen corporate climate action, not slow it down. More transparency and clear rules build trust. Additional uncertainty, on the other hand, risks companies scaling back their climate commitments.

That is precisely why we need solutions that provide orientation, make responsibility visible, and support companies in making their contribution to global climate action for the long term.