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Last year, Australia’s carbon market reached a value in excess of A$1 billion. At its peak in 2021, the voluntary carbon market exceeded US$2 billion and estimates from the likes of Morgan Stanley consider it could grow to US$250 billion by 2050.
Key to these growth opportunities will be the demand arising under country to country buying of carbon credits through the market mechanisms established under Article 6 of the Paris Agreement, and other compliance schemes such as CORSIA (the international aviation offsetting scheme). The current expectation is that demand drivers will spur new investment opportunities, particularly in emerging economies.
From a local perspective, over the last year, we have seen significant investment from compliance entities under the Safeguard Mechanism, which is likely to increase once Australia’s 2035 target has been determined later this year.
The carbon market also provides unique opportunities in the nature based space, with project activities able to generate returns from both the carbon and nature components. Australia’s first of kind nature repair market has now formally commenced operation, and market participants are evaluating the opportunities this scheme presents. As Trustees seek to meet their net carbon targets and meet growing member demands for responsible, sustainable investment, venturing into new markets and exploring new climate and environmentally responsible investments can give rise to both opportunities and challenges. Investment due diligence will need to be tailored to these highly technical investments and trustees may need specialist support to ensure they are meeting their obligations.
In this session we will take you through all the key topics trustees need to be across: we’ll start with the fundamentals, by outlining what these investments are, how they work and what developments are on the horizon. We will help you navigate the investment due diligence process, covering how you conduct due diligence on these specialised investments and the steps you need to take when investing in these markets, in light of your duties as trustee.
Join us for an informative and interactive discussion about the opportunities that these markets will provide, including understanding the likely barriers or hurdles that may restrict or prevent investment in the short term and that you need to be mindful of as trustees.
Speakers
Liz Hastilow | Partner and Head of Office, Sydney
Lucinda McCann | Partner, Sydney
Elisa de Wit | Partner, Melbourne
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