The London Stock Exchange has today published the final admission and disclosure standards for London Stock Exchange’s Voluntary Carbon Market (VCM) Designation. (n1922.pdf (londonstockexchange.com)

The development marks the launch of the first public markets capital raising solution for the voluntary carbon market. It will:

1.       Direct finance into climate mitigation projects giving rise to carbon credits

2.       Provide market access to investors and corporates

3.       Apply the public market regulation and disclosure obligations  

It is open to closed ended investment funds and operating companies admitted or seeking admission to trading on the London Stock Exchange’s markets. This allows a fund or an operating company to raise capital from investors through an IPO. The capital raised will be invested into climate mitigation projects, like reforestation or carbon capture possibly alongside other climate-aligned assets. 

See related article: MSCI and the London Stock Exchange Reject EU ESG Regulation Proposals

It follows the London Stock Exchange’s publicly announced intention to create a carbon markets solution at Cop26 in Glasgow in November 2021 and a market consultation on the rules during the summer of 2022. 

For a brief explainer of the new rulebook – please see the video explainer. https://www.londonstockexchange.com/raise-finance/equity/voluntary-carbon-market

Julia Hoggett, CEO, the London Stock Exchange comments: 

“Our goal is to facilitate the financing of projects that are focused on climate change mitigation. Today’s publication of our admission and disclosure standards marks the launch of the first public markets solution to help raise capital for the voluntary carbon market.

“It paves the way for capital at scale to be channelled into a range of climate change mitigation projects, while providing corporates and other investors with net zero commitments with the ability to access a diverse supply of high-quality carbon credits.

“We are in discussions with a wide range of corporates and other investors, fund managers and project developers and expect the first issuer to use the designation shortly.”

If you would like more information or are interested in speaking with a London Stock Exchange executive about these new rules, please reach out. 

Source: London Stock Exchange