PETALING JAYA: Bursa Malaysia Bhd will launch the Voluntary Carbon Market (VCM) exchange this year to enable companies to purchase voluntary carbon credits from climate friendly projects and solutions that will support financing for projects and solutions that reduce, remove or avoid greenhouse gas emissions (GHG).
Bursa Malaysia said the VCM exchange will allow buyers and suppliers to transact standardised carbon credits products and technologies by auction at transparent prices by year end. The clearing price from the auction will provide a reference point for secondary trading for market participants and establish a baseline demand for carbon credits. In addition, it will help provide clear price signals to support the development of domestic carbon credit projects.
To ensure high integrity of carbon credits offered through the VCM exchange, Bursa Malaysia will adopt the Verified Carbon Standard or better known as Verra, a recognised standard in the voluntary carbon market, accounting for nearly 70% of voluntary carbon credit issuances globally. Bursa Malaysia has signed a memorandum of understanding with Verra in May 2022.
Bursa Malaysia CEO Datuk Muhamad Umar Swift said stakeholder engagement is key in facilitating greater understanding among industry players and to meet ESG requirements required by parties such as lending institutions.
“With better understanding of carbon credit origination and listing processes, stakeholders will be able to develop capacities to be part of the carbon-credit supply chain. We believe the VCM exchange can serve as an important lever in realising Malaysia’s net zero GHG emissions aspiration, as well as supporting the private sector’s voluntary climate commitments and decarbonisation journey. The VCM will act as a catalyst,” added Umar.
