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When it comes to climate change, there is an urgent need to clarify how corporate investments in climate solutions can be increased to achieve substantial climate outcomes.
This was the takeaway from the roundtable Nasdaq convened on Nov. 12 at the COP29 climate conference in Baku, Azerbaijan. During the session, participants discussed how to structure and scale durable carbon removal markets to ensure a more sustainable future.
"We are at a pivotal moment in the decarbonization of the global economy," said Tomas Thyblad, VP of Carbon and ESG Solutions, European markets at Nasdaq, who hosted the discussion. "A shift of this magnitude requires an ecosystem approach, which brings organizations together to find innovative solutions."
Tomas Thyblad, VP of Carbon & ESG Solutions, European Markets, at Nasdaq’s COP29 Roundtable Discussion
The focus of the session, which was conducted in collaboration with Oxford University and Dr. Injy Johnstone, Research Fellow in Net Zero Aligned Offsetting, was on establishing clear guidelines for corporations to achieve their net-zero goals amidst the pending operationalization of Article 6 of the Paris Agreement. The discussion was based on a working paper authored by Injy Johnstone, Tomas Thyblad, and Mostyn Brown of AFRY, set to be released at the beginning of 2025. Participants discussed the use of durable carbon dioxide removals (CDR) for voluntary corporate neutralization claims and whether these must be correspondingly adjusted. After some debate, they concluded that there is a need to confirm that the conditions for collaboration, rather than competition, between the public and private sector in terms of investing in durable CDR, should be clear.
"Carbon removal must become an essential part of all large organizations' value chains, just like other critical business operations," said Injy Johnstone. "We all agreed there’s a pressing need for clearer guidelines to help corporations more seamlessly take on carbon removal efforts. Clarifying this issue would help corporations maintain their focus on decarbonization, even in challenging macroeconomic conditions.”
Injy Johnstone, Research Fellow in Net Zero Aligned Offsetting, at the Roundtable Discussion
The roundtable, part of what is being called the "Finance COP," comes at a crucial moment in the global transition to a sustainable economy. That transition will require an estimated $5 trillion in annual financing, underlining the urgent need for a wholesale approach that marries finance and government. Clarifying how corporations can use CDRs in their net-zero efforts is essential to ensure that there are no barriers to financing the development of carbon removal capacity globally.
During COP29, Tomas Thyblad also met with other stakeholders on how technological innovation and market infrastructure development can support the decarbonization. Operating at the intersection of technology and capital markets, Nasdaq has been expanding its role in the fight against climate change. Nasdaq’s new registry technology brings registry solutions in line with modern capital markets standards by meeting resiliency, security, performance and interoperability expectations. Robust technological infrastructure is crucial to achieve the necessary connectivity between the complex infrastructure in the global carbon market and will help manage Internationally Transferred Mitigation Outcomes, or ITMOs, for example.
Through its Puro.earth carbon removal registry and platform, Nasdaq enables access to secure and transparent asset creation, issuance, and transfer of durable carbon removal credits, as well as ensuring accurate ownership tracking and preventing double counting. “We also need to have more standardized carbon spot and futures contracts. This would lead to a strong secondary market for better price discovery and demand signaling,” said Thyblad. “The idea is that this would in turn drive demand toward more carbon removal projects and encourage climate-positive corporate behavior. At the core of all this is unlocking capital, which is critical for our long-term success,” he added.
For Nasdaq, the COP29 presence represents another step in its commitment to advancing sustainable finance solutions. As climate technology continues to evolve and emerging markets and asset classes play a more prominent role, Nasdaq will maintain its commitment to providing the infrastructure and expertise needed to support the transition to a low-carbon economy.
"The decarbonization is a complex challenge that requires unprecedented cooperation across sectors," Thyblad said. "Our role is to help create the market conditions that allow that to happen."
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