ICVCM Chair Outlines Regulatory Design Behind Core Carbon Principles Framework

Annette Nazareth, Chair of the Integrity Council for the Voluntary Carbon Market and former US Securities and Exchange Commission member, has set out why the ICVCM has adopted a regulatory approach to governing voluntary carbon markets and how the Core Carbon Principles compare to established financial regulation instruments. Programs representing more than 98% of voluntary carbon market retirements in 2023 have applied for CCP assessment.

Nazareth draws a direct parallel between the CCPs and financial regulation, arguing they function like both intermediary regulation and listing standards. Like intermediary regulation, the CCPs impose detailed governance requirements on carbon crediting programs. Like listing standards, they define the minimum quality threshold that credit categories must meet to carry the CCP label. The ICVCM has adopted standard regulatory practices including a full notice-and-comment process, transparent publication of applicants and assessment progress, and plans for periodic framework updates every two to three years.

The ICVCM's assessment process draws on both internal staff and Expert Panel members, as well as Multi-Stakeholder Working Groups for categories requiring broader expertise. Recommendations from these bodies pass through a Standards Oversight Committee before being decided by the Governing Board. The ICVCM also intends to periodically examine CCP-Eligible programs for ongoing compliance, with the authority to take action in the event of non-adherence — mirroring the enforcement function of self-regulatory organisations in financial markets.

The EU Certification Framework for Carbon Removals, the UK's stated intention to endorse the CCPs, the African Carbon Markets Initiative's requirement for CCP adherence, and the Monetary Authority of Singapore's alignment work collectively demonstrate how the ICVCM's framework is being incorporated into government-level voluntary carbon market governance. Nazareth argued that this interoperability between the private ICVCM framework and national regulatory systems was intentional from the outset, designed to minimise market disruption when governments decide to regulate voluntary carbon market activity more formally.

Key figure — 98% — portion of voluntary carbon market retirements in 2023 covered by programs that have applied for CCP assessment