Ecosystem Marketplace, CMIA, and ICROA recently hosted a webinar to discuss the findings of the 2015 State of the Voluntary Carbon Market Report {{PDF}}, which yielded questions that seem to be top of mind across the market. Gold Standard shares our perspective on these pressing issues.

Q: With the average price decrease, how do you motivate and explain it to project developers? Do you think PDs will continue to get involved in the market and continue with their certification process? (Expanding on this: do you see new project developers entering the market, or do you think they will be scared off by the price declines?)

GS: Where there is a price on carbon, there’s more voluntary offsetting. We’ve seen this and Ecosystem Marketplace featured this correlation in their report on the Role of Offsetting in Corporate Carbon Strategies. The voluntary market is stimulated by policy – and we hope for a clear signal in Paris.

But it’s clear that as a market we need to innovate. We’ve already seen many project developers devising new ways to bring sustainable development benefits to the forefront to demonstrate the greater value of those credits. From our side, Gold Standard introduced last year a new quantification methodology for black carbon to ultimately find new channels of finance for projects like cookstoves. We launched a new Agriculture Standard that features really simple and accessible monitoring tools. And we also launched the Water Benefit Standard, which we will now mainstream across Gold Standard projects. All these programs that have tremendous upside, if you will, in development benefits and have an opportunity to provide additional value within carbon markets.

The convergence of the climate negotiations with a very ambitious post-2015 development agenda can drive further demand for credits with SD benefits. Billions are needed to stay within 2 degrees, but trillions are needed to realize the post-2015 Sustainable Development Goals. So as the private sector also considers engagement in SD, the results-based finance approach that drives carbon markets is a simple way to accomplish a number of benefits so with clear reporting. We will also consider how to bring new financing streams to these beyond-carbon benefits, in health benefits, water impacts, gender empowerment, for example.

From a practical perspective, Gold Standard also realizes that we need to get leaner and meaner at what we do to support project developers. We will be focused on reducing the complexity of certification—Maintaining the level of rigour, while reducing time and costs. You’ll see more detail from Gold Standard on this in the coming months.

Q: What are the panelist’s efforts to create demand?

GS: Gold Standard has begun engaging directly with corporates, and we have plans to dramatically raise our voices in support of stronger climate action for business within CSR and sustainability events and publications around the world.

In this effort, we do need to acknowledge the effects that detractors of offsetting—even the Pope!—have had on the reputation of offsetting. We will engage our NGO network to promote the virtues of market mechanisms, and we’ll do our part to ensure the highest integrity in market dynamics. The Gold Standard will also develop detailed and ambitious best practice recommendations for strong climate action that positions offsetting as a way to fund the transition to a clean energy future.

Gold Standard has reached out to a number of industry players to create some disruptive ways to stimulate both bottom-up demand from individuals or ‘consumers’, and at the same time, increase the pressure on corporates to be more accountable and engage in more robust climate action that includes aggressive offsetting.

In addition, we think we all have an opportunity as a market to take advantage of any momentum created by the UNFCCC’s Climate Neutral Now campaign that will launch in September. Though focused on CERs, their visibility should significantly push the offsetting agenda. Gold Standard will build on this and encourage business and individuals to go further and make their contributions to low carbon future also transform lives in vulnerable communities.

Q: What are your hopes/expectations for COP21 in Paris? How can this COP influence the voluntary market?

GS: Our hope would be strong commitments from all members in ambitious INDCs that together shape a masterplan to stay under the 2°C. It is clear that strong domestic action is needed, and the INDCs are an essential foundation for this. In reality however, large amounts of emission are actually imported by the richer member states, which is not accounted for in their national targets. An effective climate agreement therefore needs to make sure finance is used where it’s most needed, both in the short and longer term. This is where markets should continue to play a vital role. Gold Standard, of course, hopes and expects that the climate and development agenda will continue to converge and support one another in more concrete ways.

Our expectation is that the door will be kept open for these kind of interventions, but that the more ambitious members like the EU will want to keep the emphasis on the domestic action for this COP.

Q: What is the attitude of buyers? Are they looking at short term (quick fix for CSR objectives under 2 years) or long term (offsetting will always make sense to their strategy, 5-10 years time)?

GS: While the project developers and retailers who were on the webinar have the clearest picture of what buyers are asking for, it’s clear that climate change continues to rise in public awareness. From Gold Standard’s perspective, we are seeing new major new corporate players emerging with ambitious climate strategies. They often feature long-term offsetting purchases, but the hope is often that their offset purchases would decline over time as they are able to further reduce their footprints. Many are looking first at their supply chains, so we believe interest in insetting will continue to grow. In this case, it will require adaptation for all of us.