Resources

• Rubicon Carbon
• Rubicon Carbon Integrity Framework (RCIF)
• ICVCM (Integrity Council for the Voluntary Carbon Market)
• VCMI (Voluntary Carbon Markets Integrity Initiative)
• Center for Social Value Creation at the University of Maryland
• GreenBiz Conference

Host and Guest

Climate Rising Host: Professor Mike Toffel, Faculty Chair, Business & Environment Initiative (LinkedIn)

Guest: Dr. Jennifer Jenkins, Chief Science Officer, Rubicon Carbon (LinkedIn)

Transcript

Editor's Note: The following was prepared by a machine algorithm, and may not perfectly reflect the audio file of the interview.

Mike Toffel:

Jen, thank you so much for joining us on Climate Rising.

Jen Jenkins:

Thanks, it's lovely to be here. I really appreciate the chance to talk to you today.

Mike Toffel:

So you and I have known each other for I think 25 years since we were students together at the Yale School of Forestry and Environmental Studies, now called the Yale School of Environment, when we were both master’s students. You were more on the science side; I was more on the business side. And it's been so fun to watch your journey from a professor working at EPA, becoming a chief sustainability officer, and here now at Rubicon Carbon.

Can you just tell a little bit of how you, that meandering journey of the triple threat of nonprofit, public sector, and now private sector?

Jen Jenkins:

Right, thank you. Mike, I think it was actually 30 years ago that we graduated. I hate to break that too—long enough ago. But I think for me, the headline all along has always been climate action, right? So we graduated from Yale. I went on, I earned a PhD from the University of New Hampshire, studied forest atmospheric carbon exchange, and went into various government and academic roles. I loved academia. I didn't mind government. But I generally just found that I really wanted my work to matter. I really wanted it to make a difference. And I was impatient, finding that the pace of action in government and academia was just too slow.

And so in 2015, I made the pivot, and I actually went back to school to get my own MBA and moved into the private sector about a year later. So, and I haven't looked back, right? It's been eight or nine years since I took my first chief sustainability officer role and really have found that the hunger for action and impact in the private sector is impressive. And I've really enjoyed my time in the various roles that I've had in business.

Mike Toffel:

Yeah, great. And so you went from a CSO or chief sustainability officer, which usually has a pretty broad remit to working at Rubin on Carbon, as the chief science officer, which has a much narrower remit.

Jen Jenkins:

Well, I guess most chief science officers would have a pretty narrow remit. I actually, because we're a small team, our science team is responsible for the quality and integrity of the credits that go into our portfolio, right? So we're very, very laser focused on that. But I also manage government relations, and leadership. For a while I was managing the marketing function. So a jack of all trades in a way, and I work very closely with our CEO.

Mike Toffel:

Got it. Let's talk at a very high level, because we're going to get into it in depth. But at a high level, just tell us a little bit about Rubicon Carbon. What was the impetus for its founding? What does it do? Who are its customers?

Jen Jenkins:

Yeah. Rubicon is a vertically integrated carbon credit investment and management firm. Right. So we make investments in high quality projects that yield credits. We package those credits plus others into portfolios that we then sell to customers. And so the portfolios that we sell, one ton from that portfolio is called a Rubicon carbon ton.

And it's kind of like you could think about it like an EFT, right? Like, so one share, one Rubicon carbon ton is basically when you buy that ton, that ton is comprised of, you know, little pieces, right? Of each one of the projects that make up that portfolio. And so when you buy an RCT, what you're buying is the right to retire that credit at some point in the future that you decide. And what we do is we actively manage those portfolios through time. So that if there's an issue with a project, if there's a reversal, maybe a fire, or if there's an accusation of malfeasance somehow as part of the project, we can swap that project out, put another project in. And the idea is to manage the risk for our customers so that when they do retire credits, they're the highest quality and there's no headline risk for the customer.

Mike Toffel:

Great, great. Now that's a really helpful explanation. The idea that you're vertically integrated is pretty unusual in the market where we, I'm more familiar with lots of thin layers. There are developers and there's folks who are agents who are looking for the developers and then they repackage them and then they sell them and eventually there's buyers. And so it's very much a vertically disintegrated marketplace in general. Is that right?

Jen Jenkins:

Yeah, there are definitely a lot of different layers. We are not active developers. We work with developers; we make investments in developers and in projects. And we hold hands with the developer and the project, with the developers as they're building the project. In many ways, that helps us to ensure the quality meets our specs.

So we don't—we're not quite that vertically integrated, if you will, right? But we do make investments. Rubicon was started—we came out of stealth mode in November of 2022. So we've only been around for a couple of years. We are fairly new in the market, but we were incubated by TPG, a private equity firm, through its Rise Climate platform. And TPG was listening to all of the excitement in 2020 and 2021 around the voluntary carbon market. Remember Mark Carney put together the task force on scaling the voluntary carbon market, and everybody was like, "This is going to be great. This is a way that companies will be able to help meet their net zero commitments." So TPG made a fairly big investment in the VCM, and we still believe in the VCM and its potential to make a big difference, create a lot of climate impact, and help society really to reach net zero.

Mike Toffel:

All right, great. So there's a lot of vocabulary already that we're talking about, and I want to unpack it. And I thought one way to maybe do that for a carbon credit 101 might be the lifespan of a carbon credit. And we talked about the development process, which I think is where it begins. Walk us through, if you would, each of the steps in the progression of what eventually becomes a carbon credit and maybe highlight as we go along the risks or the controversies that are impairing the VCM, the voluntary carbon market, so that we can get a little bit of a more brass tacks handle on these items.

Jen Jenkins:

Yeah. So, that's a great question. Let’s talk about probably the most well-known projects in the voluntary carbon market. And I’m going to say the VCM, right? For short. The well-known project types are probably the tropical deforestation credits, right? These are the projects in what’s called the REDD+ category—reduced emissions from deforestation and degradation. The “plus” stands for all the other benefits that accrue from saving forests.

So let’s say there’s a developer who sees a patch of forest in a country where the forests have very high density and biodiversity value, typically in the Global South. That forest is at risk—it’s being lost for some reason. Typically, it’s because the community living there is using that forest for their own survival. They’re doing something with the forest that meets their needs but is causing the forest to be lost.

What the developer will do is carve out a particular area, or geography—this is the project area. They’ll say, “What I’m going to do is work with the people inside this project area to convince them that there are other ways they can meet their needs using the forest.” Maybe it’s about economic development. Maybe it’s finding another fuel source for cooking. Maybe it’s educating the population so they have other opportunities and other ways to create economic growth.

The developer carves out that area, implements the project (involving the things I just described, like working with the community), and then monitors what the impact has been. They do this by looking at the rate of historical deforestation or forest loss in the area—that’s the baseline. Then they compare that baseline to what is actually happening. If you’ve done a successful project, deforestation should decrease. The rate of forest loss should go down, and there should be more forest than you had expected in that area. And then, each ton is a ton of impact.

Mike Toffel:

Mm-hmm.

Jen Jenkins:

And so that's what the developer will do. That’s overall how the project works. From the developer's perspective, they have to do a few things. They first have to create the baseline estimate, which is the projection of how much forest would have been lost if this project had not happened. Then they have to write some documents and submit those documents to what's called a registry. The registry is the entity that holds the credits and manages some of the credit risks, like the buffer pool and permanence.

Mike Toffel:

These are pools, just to be clear, these are buffer pools if something goes wrong, these are spare credits that can be used almost like an insurance policy.

Jen Jenkins:
Exactly. Yeah. And any project that is listed under that registry, depending on the project, has to contribute some fixed number of its own credits to that. But it's like a combined buffer pool for all the projects that that registry is in charge of. So the developer will have to do that. They will have to, you know, write some documents and submit those to the registry.

Then they have to get it third-party reviewed by what's called a validation and verification body or a VVB. And that VVB then says to the registry, you know, check this project is good. They've followed all the rules. We believe based on our expert review, you know, as a third party of this documentation against the Vera, you know, whatever the registry is, often for these kinds of projects is typically Vera.

We've reviewed the project against the requirements of Vera, and we believe that these credits are legit. And then the credits can be issued by the registry. And then they sit on the registry. It's like a giant spreadsheet. It ought to be a database. It's usually just a spreadsheet. And then, when somebody buys them, that information about who purchased them is also kept. Vera keeps track of that information.

Okay. And then the last step, once somebody's bought those credits and they want to use them as part of their net zero journey, right, as a buyer, some company would buy them and they want to use them at that point, they have to retire those credits, right. Or basically say to the registry, I have used these credits. You have to cancel them basically, or retire them, which means they're now not available for anybody else. So that avoids what's called double counting, right? Where somebody, you know, where two entities count the same credits. So that's the journey of our REDD+ project.

Mike Toffel:
Love it. Great, why don't we pause there and talk about some of the risks associated with that process. And I wrote a piece in Harvard Business Review about a year ago that listed out some of the risks, like the measurement issue that you described earlier. Like, are you sure the ton is a ton? Or are there estimates? And might those estimates be biased in one direction? That's a fairly straightforward one. You've already referred to, with this buffer pool, what is sometimes called a durability or permanence risk. That's one form of that type of risk where you set aside this forest, but then maybe a hurricane comes through and knocks down these trees that you've been so hard preserving, or a forest fire or something like that. Right? That's a permanence risk for which you would then dip into the buffer pool to restore the validity of the retired number of credits, if I'm following this correctly.

Jen Jenkins:

Yeah. Right. Yeah, no, exactly. Yeah. Now you've got it.

Mike Toffel:

All right, good. So another one is leakage, which I think might be particularly relevant in the example that you cited. So can you talk a little bit about what is leakage and how organizations are managing that risk?

Jen Jenkins:
Yeah, I mean, and you have to manage these risks, you know, mostly in a lot of the same ways, but so leakage is a phenomenon where, let's say, your project is in a forest that would otherwise have produced some products like wood, like timber, right? Forest products. Leakage is the phenomenon where if I cordon off this one piece of working forest such that nobody can harvest from it, does that actually reduce overall demand for those forest products, or does that demand just squish off and go somewhere else, right? Does that just mean that the forest next door is harvesting twice as much, right? And so if that happens, then you really haven't helped the overall climate very much. And so, you know, that's a concern and a risk with the carbon accounting of those projects. I mean, I can talk about how those are definitely risks. There are risks in every project and every project type, and they express themselves to greater and lesser degrees, right? Depending on the project type and who's the developer and what assumptions they've made going in. So, you know, they're all risks that are, in our view, quite manageable, right? I think the overall risk right now is the risk to the market in my view of, you know, this complexity and all these overarching risks being so confusing to everyone, right? And, you know, the risk, in my view, is that we give up on the market overall because it's too hard to manage these risks. And that's actually where the financial analog really comes in, right? Because we need to recognize there is risk everywhere. The minute you buy a stock, you're taking on risk, right? And that risk may be opaque to you. You don't know what, you might not know what's going on inside that company, right?

Mike Toffel:
Right.

Jen Jenkins:
How do you manage that risk? Well, you diversify your portfolio. You do all the research you can going in. You understand what you rely on ratings, right? You might look at somebody else who's, you know, an analyst who's looked at that stock. The market just needs to recognize that there are risks everywhere, and we need to do what we can to minimize them. And there are lots of other sorts of efforts that are ongoing, we can talk about later, that are set up and stood up in order to help manage those risks.

Mike Toffel:
Yeah, great. And we'll talk about that in just a moment. I want to just complete our risk survey. One thing that's interesting about leakage compared to the measurement issue and the permanence risk is that for leakage, you have to look off the site that you've been preserving somehow, which seems to me, not having done this, just seems like a harder thing to do.

Jen Jenkins:
Mmm. Yeah. I mean, although to be fair, to assess the baseline, you also have to look off the site, right? Because you have to look at what the regions are that are similar to the project area, right? Because presumably those are the ones that those other forests that are maybe adjacent to your project area that you're protecting have the background rate of deforestation. And so that's also really important. Often what people do is say, yes, there are risks. So what I'm going to do is I'm going to buy double the credits, right? Or for leakage, I'm going to just assume, you know, there are some assumptions you can make, right? Depending on the situation, I'm just going to assume that 30% of my carbon is subject to leakage. And I'm just going to say, I'm going to deduct that amount from my credits, you know. And that's all knowable. It's all transparent in the documentation.

Mike Toffel:
Right. Got it. Another risk that people talk about is additionality. And I think, as I understand it, as I describe it, it's: would this project have happened absent the funding that they're getting from the credits? Because the credits are supposed to be that turning point from a project not happening to a project happening. And that's the logic of why if you sell the credits, it leads to fewer tons of carbon entering the atmosphere. And so for that, is that primarily managed through the paperwork trail that you described earlier of the registry standards and the VVBs ensuring that the registry standards were being upheld?

Jen Jenkins:
Yeah, I mean, there are different kinds of additionality that we look at, right? A really important one, for example, is like regulatory additionality, right? So if, for example, a government rule requires that you do a thing and then you get paid to do that thing for a carbon credit, well, wait a minute, you know, did the carbon finance actually make a difference to you doing that thing? The answer is probably not, because you had to do it anyway.

And so we know, the safety, so additionality for us is really yes or no. And so we have a very stringent due diligence process and whether or not a credit is eligible for our RCT, you know, we'll go through a really detailed analysis of that. And the answer really is, you know, additionality is a big one. Is it yes or no? Is it in or out?

Mike Toffel:
Mm-hmm.

Jen Jenkins:
And we get the information, yes, from those documents, but we also do a lot of other background research, like desktop research and regulations in the target country. And if we can, we'll look at the financial model, right? Is it financially additional? Those are really important questions. Unfortunately, for additionality, the registries haven't really been great at helping customers diligence that particular issue.

Mike Toffel:
Interesting. Why is that?

Jen Jenkins:
It's just really hard. Think for the, and in the case of, you know, we're jumping all over the place with different project types, but a really great example of additionality is in the improved forest management space, actually in the U.S., right? And so improved forest management or IFM is a different kind of credit or project where basically somebody who's got a forest that might otherwise be harvested, they might extend the rotation. They might choose not to harvest for five or 10 years, right? And during the time when they're not harvesting, the forest is going to accumulate incremental biomass. Now for that project to be additional, they would have had to be planning on harvesting, right? But it's really difficult in a family forest situation.

Mike Toffel:

Great.

Jen Jenkins:
I mean, they have, you know, 30 acres and look out their window. They like how it looks. But then maybe somebody has to go to college, or somebody gets a medical bill that's really hard to pay. And so they look out their window and they say, this forest now is an asset, and I could just sell it and turn it into cash.

And so, that's the case where additionality is just really hard to prove. And so when we get to the part where we talk about what's exciting, there are new ways for project developers to handle that kind of situation where you're trying to assess what would have happened if we didn't do this project. And there's something called a dynamic baseline that has just been put forward and, you know, in a couple of different methodologies where you're actually using geostatistical information from around these projects to assess what would have happened, you know, in comparison to the target project area. So that, they're interesting developments, technical ways to get around those additionality questions.

Mike Toffel:
Yeah, very interesting. Another project type that I know is popular out there among some and seems to me on the more credible side are these ozone depleting substance credits, where if I understand this correctly, there's ozone depleting substances that have been removed from the refrigerant systems or other systems that they had been used in and are just stored in canisters. And if they were to leak, they would have a big impact on climate change. But if you were to destroy them through, I think, high temperature combustion, then you would change the chemistry, and they are much more mild in their impact. And if you fund their destruction, then that's a pretty clear additionality story, because otherwise they're just laying around. And the measurement is pretty good because it's chemistry. My sense is that's on more credible side. Do you agree with that?

Jen Jenkins:
Yeah, I mean, they are not subject to many of the same risks that some of the forest conservation projects are. I want to defend the forest projects just for a second though, because if we don't stop cutting down the forest, we're never going to get to net zero as a society. So that's a drum that I beat wherever I can.

Mike Toffel:
Yes.

Jen Jenkins:
Right. And so we need to find a way. And I think there are interesting ways to get around many of the risks and concerns that people do have about the forest projects. That said, we love these super pollutant projects. Right. And so the thing about ozone, the ozone depleting substances is that they're like HFCs, HCFCs, CFCs that have really high global warming potential compared to CO2. So basically destroying one ton of one of these chemicals has an equivalent impact to removing thousands of tons of CO2, right? Because the impact of destroying these chemicals, they're not around anymore. That is a permanent impact, right? And so there are, your description of them was absolutely right. They're being phased out. Because they're being phased out and we're not using them, there are canisters, like you said, of these substances just sitting around in warehouses in various places around the world. And so there are companies that are making it their business to go find them and create safe mechanisms to destroy these chemicals and then sell. The way they finance it is through carbon finance, right? Through earning carbon credits for the destruction of these really harmful substances.

Mike Toffel:
Yeah, and of course the key assumption in this space, I think is quite reasonable, is that if you don’t destroy them at some point, they're going to leave.

Jen Jenkins:
Yeah, I mean, it's pretty clear. The same with methane. It has a global warming potential of about 26 or 28 times that of CO2. And so if you can just destroy methane by flaring it at a landfill, better yet, destroy it by turning it into electricity from a landfill site or a biodigester. Methane is another example of a super pollutant.

Mike Toffel:
Right, great. Okay, so very helpful to understand the life and death of a carbon credit, some of the risks associated with different projects. Let's talk about what I think you've termed VCM 2.0. So the voluntary carbon markets have the potential of being with these risks managed well.

Jen Jenkins:
So yeah, we are in the VCM right now, I would say we're in the midst of a transition from VCM 1.0 to VCM 2.0. It's been going on for about a year and a half. And it's characterized by groups like ICVCM and VCMI, right? And so it's an acronym.

Mike Toffel:
Can you spell those?

Jen Jenkins:
So ICVCM is the integrity council for the voluntary carbon market. And what they are doing is they're the quality watchdog on the supply side. So the ICVCM is, it's a nonprofit group that has been convened and its self-governed. And they are, they have laid out a series of principles that they call core carbon principles or CCP.

CCPs and those principles basically lay out what good looks like for a quality credit. And so the ICVCM has been working now for about a year and a half and they have released, they have convened multi-stakeholder working groups to work through the various methodologies that exist. And they have approved some methodologies, they've rejected other methodologies.

The most recent announcement actually was that they approved a REDD+ methodology that Verra had released that will allow project developers to move forward with CCP tagged projects, which is great. So that's the ICVCM on the supply side.

On the demand side, we have VCMI, which is the voluntary carbon market integrity initiative is another nonprofit, convened to help companies work through what an appropriate claim looks like. Right. So the VCMI has released what they call the claims code of practice, which guides companies to how they might make a legitimate claim using carbon credits. And we can talk more about that, but the VCM 2.0 is characterized by these two initiatives that are really trying to shepherd companies through this difficult process. I think the other thing that's happening is you have companies like Rubicon that are coming in and taking different more innovative approaches to packaging credits and risk adjusting portfolios and really hammering home the importance of quality.

Mike Toffel:
So what do they view as their purpose, these organizations?

Jen Jenkins:
Okay. That's a great question. Right now there is a lack of clarity for companies about what they can do, how they can get involved. We have, and combined with that, there is a climate and atmosphere of concern and fear, around getting involved in the VCM.

What every company is worried about is headline risk. They don't want to invest in a project that looks good right now, right? It met all the quality bars. The VVB approved it. It got listed on Vera's registry. It followed all the rules, right? That's true of every single project in the VCF, right? But some of them have been, you know, identified in the media as not having reached their goals, right?

So, every company is worried. They don't want to be the one that gets tagged with that kind of a headline. What I really want to get to is the fact that there's no good incentive right now. The frameworks are lacking clarity, right? The frameworks right now, like SBTI, VCMI, they don't allow companies to count credits toward their target. Right? There's an insistence on the part of civil society, right, that companies do their internal decarbonization work first and actually they don't even allow the use of credits, except for an SBTI's case, you can use credits at the very, very end of your journey, you can use permanent removals to balance your residual emissions.

Mike Toffel:
And SBTI, we're talking about the Science-Based Target Initiative, the organization behind the whole movement for organizations to have what they call science-based targets.

Jen Jenkins:
Right, but they are, the problem is many companies are out there, they want to get involved. They have legitimate reasons for wanting to reduce their own footprint, but they get to a point where internal decarbonization technologies simply aren't available or they're not scalable or they're too expensive, right? At some point you can't spend $400 per ton of carbon on the next most available decarbonization technology for your business, you'll put yourself out of business? But companies would like to still participate in the market. And they would like to still create impact. And so if we allow companies to use credits in the VCM, they can make that marginal difference. By investing in projects in other parts of the world that frankly costs less per ton. And the atmosphere doesn't care. The CO2 is well mixed. It doesn't matter where the reduction occurs. It just matters that it happens.

Mike Toffel:
Yeah, if you take away all these questions about risk, if you could figure out how to manage and measure risk, it seems to me that buying credits is, in a sense, no different from outsourcing the production of other goods or services, which firms do every day.

Jen Jenkins:
That's a really good, yeah.

Mike Toffel:
Because the other provider can do it cheaper or higher quality or with more flexibility than you can yourself. You've got lots of choices about what's insource versus outsource. And in this case, what I'm thinking of is organizations face a whole variety of project options that they can do internally or that they can coordinate with their suppliers or their downstream users to use their product differently, like wash with cold water as opposed to hot water, for example, if you're a detergent seller, or on the upstream if you're using steel, green steel versus traditional steel and so on. And so you've got all these project ideas, and many organizations think they also have access to the voluntary carbon market, which are, in a sense, a whole bunch of other projects. They just happen not to be organizations that they transact goods and services with.

Jen Jenkins:
Yeah, that's exactly right. It's just outsourcing your emissions reductions. And we're not saying that companies shouldn't even look inside and that they shouldn't do what they can inside their value chain. What a big difference would be if those companies could then, once they get to where they've gone as far as they can. But maybe they have, there's a permitting problem with something they had planned to do, or they find that the technology they had counted on is simply not ready yet, right? They should be able to use credits to then say, transparently, we did meet our target, we met it using credits. And, here's the projects we bought.

Mike Toffel:
Right. Now I think one of the concerns that I've heard is if everyone did that, are there enough, is there enough land to preserve or there enough ozone depleting substances to combust? And I think the answer is no. And so to your point earlier, relying only on credits is not really a solution at scale. And you're not advocating that, but I think those who fail to mention that detail I think are vulnerable to this easy rebuttal.

Jen Jenkins:
Yeah, but I think in that event, what we will see is that the prices for the available credits will go up to the point where they will rival the cost of internal decarbonization. And then the arithmetic that a company has to do is just a little bit different. Maybe they'll do the next most expensive internal decarbonization thing instead of buying credits. Yeah, so I don't know that anybody has done an inventory, but I will say that there are so many, it's so interesting. We have been a fossil fuel dependent society. We've spent the last 300 years developing technologies that depend on fossil fuel. There are so many opportunities for creating new projects and new project types. It's just overwhelming. I guess, I tend to be pretty optimistic -- I have to, to work in climate. But I think there are so many different project types out there. I'm not sure we're going to run up against that kind of a shortage in the near term.

Mike Toffel:
I think that's right in the near term for sure. So I want to talk about two other efforts that Rubicon's directly involved with. So one is we've talked about these, the ICVCM and the VCMI, and they both have integrity as one of their I’s. And Rubicon itself has its own integrity acronym, Rubicon Carbon Integrity Framework. We call it the RCIF. So we just released it.

Jen Jenkins:
So what we've done is we've broken down the what we view as the elements of quality into different categories. And I'll just give examples. For example, carbon accounting, how complete is the carbon accounting presented by the project developer? Are there pieces in the LCA or life cycle analysis that might be left out? Did they miss an important process that might have an emission associated with it? Is the baseline appropriate if it's a nature-based project? Those are the carbon accounting pieces of the RCIF. Another one is future delivery risk. Some of the nature-based projects in particular might be affected by future climate change. And so how likely is that future change, drought or fire to cause a reversal, to a reversal and the loss of the stored carbon in that region. Another one might be the certification risk, like how transparent is the documentation? If we've reached out to the developer, did they respond to us? Do we feel confident about the information and the technical capacity and capability of the project developer? You know, those are the kinds of things that we look at as part of the RCIF. And we do use that on an ongoing basis to evaluate and manage the portfolios. Because remember I said, the RCT is an ongoing thing. So we're actively managing, and we have customers that buy and hold those credits and they're basically trusting us with their reputational risk. And so it's important for us to make sure that we stay on it. And that's how we use the RCIF and the elements in it to do our ongoing monitoring.

Mike Toffel:
Got it. So this RCIF, the Rubicon Carbon Integrity Framework, is now published on your website for folks to see.

Jen Jenkins:
Yeah. We have a YouTube channel. I know we made a LinkedIn post. There's a user's guide. The scores for each of the projects that we own are transparent to our customers as part of the customer portal, but they're not available to the public.

Mike Toffel:
Okay, and then the last effort is the Business Alliance for Climate Action. Tell us a little bit about that one and how does it differ from the other three programs that we've discussed?

Jen Jenkins:
Yeah. So the Business Alliance for Climate Action, it's a fairly new initiative. What we had been finding over the course of, really certainly in 2023, the negative media narrative around the VCM had been spilling over into the regulatory and policy realms. And so we were seeing proposals floated in various jurisdictions that were negative and would not serve to scale the market, but would instead serve to make it much more difficult or allow lots of lawsuits that might just not be appropriate. And so there was a real need to engage in these policy discussions around the world in key jurisdictions and so together with a colleague from a new climate we created the Business Alliance for Climate Action. We have a steering committee of seven like-minded firms in the VCM and we're gradually slowly adding other members. We have four principles that you'll see on our website. And we're going into these key jurisdictions and we're advocating for the initiatives and the policy proposals that will scale the market and not shut it down. Our mandate right now is really focused on policy, right? Most of our energy and our time and our resources since last spring was in the EU around the Green Claims Directive. Because the EU government is trying to pull together rules and legislation that will govern how companies can use carbon credits in making their claims. And that's obviously a key part of increasing demand in our view for credits in the VCM. EU is kind of going first. And we know that they'll be viewed as the leaders. And we want to make sure that we have a say in how that legislation ultimately turns out.

Mike Toffel:
Great. So that already blends into what I was going to ask you next, which was just a look ahead into the markets. You mentioned there's new technologies, there's these new policy efforts. What are you most excited about in the coming years in the VCM space?

Jen Jenkins:
Yeah. You know, one thing that I haven't talked about yet, but that I really think is important for us to keep in mind, I think the potential for the VCM is huge. And the need for it is huge, especially now in today's political climate. McKinsey estimates that we're going to need $275 trillion total between now and 2050 in order to reach the net zero transition. I don't want to scare you, but that basically means we need $10 trillion a year, for the next 27 years, right? Where is that money going to come from? We know from COP, COP gave like 300 billion? Governments were able to cough up 300 billion for the developing world, just last month. So, not even. So, where's that money going to come from?

Clearly, maybe not from governments, right? Probably not from philanthropies, right? It's going to have to come from the private sector. And how are we going to get people involved? We need to create the kinds of incentives that are going to make it like appropriate and unimpeachable. For companies to get involved, we should be rewarding these companies that get involved in buying credits, not tearing them down. And so when I think about what I get excited about the VCM is there's so much climate impact that we can create here if we can get the rules and the incentives. And make sure that everybody is on the bus driving in the same direction trying to improve quality, and ensure that all of the quality integrity initiatives are incorporated. But I think the other thing people need to understand is that there is risk everywhere. And what we need to do is manage that risk and properly account for it the way we do in the financial system.

Mike Toffel:
Great. So there's so many areas that we've talked about in the voluntary carbon market. There are developers, there's selling, there's rating agencies, there's registries, there's validators, there's organizations like Rubicon. What advice do you have or resources might you think about to recommend for folks interested in learning more and potentially pursuing a career in this area?

Jen Jenkins:
You know, I, there are so many different spaces and events that you can just go to and glean information from. And I'm on the board of the Center for Social Value Creation at the University of Maryland and they run a sustainability and business conference where I spoke last October, something like that, right? Like there are lots of events that universities run or that might be taking place in your city that are probably free and you can just go and learn and maybe meet some interesting folks. I've also every year at GreenBiz, which is in February in Arizona, where all the sustainability people gather. It's a giant meeting. Super interesting, lots of diverse panels and presentations. But I think they must have a scholarship program because I often see young people walking around drinking in the proceedings. Meeting people and, you know, just gleaning what they can from the people that are there. And everybody at Green Business, super open and kind and, you know, ready to talk and share their work. I would recommend this.

Mike Toffel:
Great. Those are great. And we'll put links to these and all the other really interesting resources and programs you've been mentioning through our conversation, all on our show notes so that listeners who want to say, what did you say? We'll provide links. Jen, it's been such a pleasure. It’s really fun to have old friends on the podcast. So I really appreciate your spending time.

Jen Jenkins:
Thank you. It's been a pleasure.