Well-designed Carbon Market Offers Scalable Solution For Climate Change - Bursa Chairman

KUALA LUMPUR, Aug 8 (Bernama) --  A well-designed carbon market should offer an available and scalable solution for the world to take immediate action with integrity and impact, said Bursa Malaysia Bhd chairman Tan Sri Abdul Wahid Omar today. 

For this very reason, he said the Malaysian government announced the Voluntary Carbon Market (VCM) initiative during the Budget 2022, and subsequently, the Bursa Carbon Exchange was launched by the bourse at end-2022. 

“The VCM serves as the first carbon pricing instrument in the country to catalyse and encourage decarbonisation efforts, and over time, I believe there should be an introduction of a compliance carbon mechanism in the country as well,” he said during the second Malaysia Carbon Market Forum (MCMF) here today.  

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Abdul Wahid pointed out that carbon markets do not just emphasise greenhouse gas (GHG) emission reduction. 

A well-designed scheme also prioritises the inclusion of co-benefits, which can be qualitative and quantitative, while also representing additional benefits, typically to the environment and communities within the boundary of the carbon projects, he added. 

“While we understand the significance of carbon markets, the recent opposition to the use of carbon credits in some scenarios has unfortunately driven some responsible corporations to ‘greenhushing’ to avoid the reputational risks associated with greenwashing.

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“We acknowledge that, as with any nascent markets, the global voluntary carbon market is still maturing, and while we work towards this goal, we welcome feedback to collectively improve the integrity and quality of Malaysia’s carbon market,” he said. 

Nonetheless, Abdul Wahid stressed that carbon credits that represent real GHG emission reduction must always be used alongside direct mitigation intervention. 

He said that given the climate urgency that the world faces, we should not let perfection get in the way of doing good.

“There has also been concern that companies that use carbon credits to reduce their carbon footprint will delay reducing their actual GHG emissions. 

“On this note, I would like to share with you the key findings from Trove Research in June 2023 which revealed that companies that are material users of carbon credits decarbonise twice as fast as those that do not,” he added.

Bursa Malaysia’s wholly-owned subsidiary Bursa Carbon Exchange and the International Emissions Trading Association co-organised the second instalment of the one-day MCMF.

Themed “Empowering Climate Actions through Carbon Market,” MCMF centres on exploring best practices to advance Malaysia’s carbon market ecosystem in support of the national climate agenda.

-- BERNAMA