Standard Chartered has announced a five-year agreement with the government of the state of Acre in Brazil, to sell high-integrity forest protection carbon credits.
As many as five million credits could be brought to market in 2026, in what Standard Chartered said was one of the ‘first examples of a major international bank working with a sub-national government or state entity in this way to help support forest conservation’.
The credits will take the form of jurisdictional carbon credits, which differ from project-based credits by covering an entire jurisdiction and being overseen by the government. They will be registered through the Architecture for REDD+ Transactions (ART) registry, using its TREES methodology, which has been approved by the Integrity Council for the Voluntary Carbon Market.
Economic incentive
“Without deploying new market mechanisms, standing forests are unlikely to be protected because the short-term economic incentive for deforestation nearly always outweighs the perceived value of these long-term natural assets in situ,” commented Marisa Drew, chief sustainability officer, Standard Chartered.
“We’re leveraging our global network and carbon market expertise to address this challenge directly, offering a means to help preserve standing forests that act as vital carbon sinks, and in turn help the communities that depend on them continue to realise the economic and social returns they provide.”
The government of Acre will distribute the funds generated from the sale of the credits according to a benefit-sharing strategy, with 72% set to be allocated to indigenous and local communities.
These funds will be used to support sustainable and low-emission livestock farming, the reforestation of secondary forests, the creation of clearings without deforestation, and sustainable community-based tourism.
The remaining 28% will be used to finance project management and governance, including forest management, monitoring, and emergency response to weather events.
Looking ahead to COP30
Standard Chartered will act as the exclusive seller of the credits into the market, with Germana Cruz, the bank’s LATAM CEO, highlighting the significance of the initiative in a year in which Brazil will host the COP30 climate change conference.
“As the world looks toward COP30, the State of Acre is stepping forward with bold leadership on carbon markets – combining environmental ambition with economic opportunity,” she said. “Standard Chartered is proud to support this vision by bringing our global expertise in sustainable finance to help build credible, scalable carbon market solutions for our markets.”
The State of Acre’s carbon credit programme is currently undergoing an independent assessment by Sylvera, a carbon data provider. This marks the first independent review of a Brazilian jurisdiction’s carbon credit classification under the ART-TREES standard, and ‘will ‘help to increase market confidence’, Standard Chartered said.
Net-Zero Banking Alliance
Standard Chartered remains a committed member of the Net-Zero Banking Alliance (NZBA), with its CEO, Bill Winters, recently criticising other international banks for their withdrawal from the UN-backed scheme.
“Shame on them,” he commented in a recent media call. Read more here.
