Australia’s world-first carbon market-related consumer protection mechanism, the Australian Carbon Industry Code of Conduct, has delivered its annual results from its first year in full operation, revealing increased participation and a strong expansion of the Code’s operational responsibilities in FY21.
After becoming fully operational for the first time in July this year, the Code has committed the nation’s carbon industry to higher standards of integrity, transparency and accountability, and seen a 71% increase in Signatories in the last 18 months – now at a total of 24.
The Code Administrator, the Carbon Market Institute (CMI), has most recently welcomed the New South Wales government as its second formal Government Partner, joining the Queensland Government in formally endorsing the Code as a critical third-party assurance framework for ensuring integrity in state carbon markets.
Code Signatory status is also now an eligibility requirement for the Queensland Land Restoration Fund and the Western Australian Carbon Farming & Land Restoration Program. The Clean Energy Regulator also regards maintenance of Code Signatory status and adherence to the Code’s compliance obligations as key factors evaluating participants in the Emissions Reduction Fund.
John Connor, CMI CEO, said it has been a landmark year for the Code in further developing industry integrity: “The report highlights the Carbon Industry Code of Conduct’s influence to-date, and the increasing integrity of the market as a whole.”
“The fact that not one Signatory has recorded multiple identical breaches year on year has been a strong indication of compliance levels, and that companies systems and behaviours are improving.”
“Continued engagement with carbon industry stakeholders – ranging from natural resource management groups to multi-national corporates – will become ever more important as Australia embarks on our path to net zero emissions under bipartisan support.”
Since July, the Code has had expanded its powers to investigate consumer complaints, monitor and audit activities of its Signatories, and take enforcement action against those that deliberately mislead or disadvantage community members or clients.
The Code Administrator identified 15 breaches in FY21 relating to improving Signatories’ administrative processes. 11 of these were resolved by the conclusion of the compliance period or had an agreed process in place as approved by the Code Administrator to resolve the breach. The Code Administrator has been working through the remaining breaches with current Signatories, noting that no severe breaches were recorded.
Brad Kerin, Director of the ACI Code Administrator team said that the Code’s expansion meant that greater scrutiny of market participants was expected: “The Code has expanded significantly in the last 12 months and we’re starting to see landowners and landholders recognise and call out bad behaviour when they see it”.
“We’re ready to take on and investigate complaints against Signatories to ensure that consumers of carbon services are protected, and that we can support these organisations to improve their operations in line with best practice behaviours.”
CMI recently also appointed former Clean Energy Regulator board member Virginia Malley, and regulatory, carbon and financial market experts Kim Lawrence and Ross Carter as members of the inaugural Code Review Panel – an independent body that will act as an arbitrator of Code compliance and appeals processes.
Virginia Malley, Code Review Panel Chair said: “Maintaining the integrity of an environmental scheme is critical to its stakeholders in government, business, civil society and the investment community. What matters though with carbon projects is not only the scientific integrity of the various methods and projects but the fairness and quality of the long-term relationship between the carbon service provider and its commercial partner.”
“The Code’s existence is an acknowledgement that science and technology on their own cannot deliver our ambition without trusted partnerships,” she said.
The Code Administrator’s Annual Report FY21 is available on the Code Administrator’s website.
To enquire about the Code or become a Signatory, visit www.carbonmarketinstitute.org/code, or email us at or email to email@example.com.
To interview John Connor about the Code of Conduct please contact Thomas Hann on 0408880536 or via email: firstname.lastname@example.org.
About The Code
The Code is administered by the Carbon Market Institute (CMI), which is the independent industry association for business leading the transition to net zero emissions. CMI launched the Carbon Industry Code of Conduct in 2018, and is Australia’s world-first carbon market-related consumer protection code of conduct.
The Code’s vision is to achieve a well-functioning emissions reduction and carbon sequestration industry in Australia at the scale and quality required to significantly contribute to Australia’s greenhouse gas reduction commitments under the Paris Agreement.
The Code’s role in the carbon market is significant in that it:
• Defines industry best practice for market participants including project developers, agents, aggregators and advisers in Australia’s carbon industry;
• Promotes consumer protection and appropriate and open interaction with clients;
• Provides guidance to scheme participants;
• Promotes market integrity, transparency, and accountability; and
• Displays international leadership in Australia’s carbon market.
Code Signatories include carbon service providers who, on conservative estimates, represent over half of all carbon credits issued under the Federal government’s Emissions Reduction Fund. Code Signatories also include intermediary brokerage, legal and advisory service providers.