Businesses are increasingly under pressure from society to address climate change, promote corporate social responsibility and commit to zero net emissions. One way they can do this is by buying carbon credits from projects that reduce or eliminate climate emissions.

In the area of carbon markets, carbon credits are primarily traded within the voluntary carbon market (hereinafter VCM). In this article, we take a closer look at this market segment and divide our discussion into six sections:

• differences between VCM and CCM
• the main market participants within the VCM
• prices and supply/demand dynamics
• main market investments by project type
• shortcomings of VCM
• Ongoing improvements to VCM

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