Sustainability advisory firm ERM announced today the launch of ERM Climate Markets, a new business aimed at helping companies investing in carbon credits to address their unabated greenhouse gas emissions and achieve decarbonization goals.

The new business line comes as demand for carbon offset projects and related credits is expected to increase significantly over the next several years, as companies and businesses increasingly launch net zero ambitions, and turn to offsets as a bridge to their own absolute emissions reduction efforts, or to balance difficult to avoid emissions. In a further potential boost to the carbon credit market, the SBTi recently announced that carbon credits will likely be permitted in net zero targets to help address Scope 3 emissions.

The unregulated and rapidly growing market faces a series of challenges, however, with market participants unable to differentiate between high and low quality projects with insufficient or inconsistent data to assess the effectiveness of the projects.

Alex Cox, Head of Climate Markets at ERM said:

“Carbon markets will play an increasingly important role in delivering global net zero ambitions by 2050. They also offer significant opportunities to scale finance flows for nature and contribute to sustainable development. However, the market is complex, with increasing stakeholder scrutiny on the quality and impact of investment.”

According to ERM, the new business will help companies and investors to access high-quality carbon credit portfolios aligned with their decarbonization actions, in addition to offering social, biodiversity and economic benefits.

ERM added that the new Climate Markets team will also work with project developers to offer clients high-quality carbon project development opportunities delivering positive climate, community and ecosystem outcomes, and providing clients with access enhanced due diligence to help de-risk their investments.

Tom Reichert, Group CEO at ERM said:

“ERM already works with clients at every stage of their decarbonization journeys and, as carbon credit strategies gain momentum, we are introducing ERM Climate Markets to meet their evolving needs.”