A Tale of Two Carbon Markets

Background: A price on carbon, paying to pollute, using economics to drive behaviour change are some of the principles aimed at incentivising or forcing businesses to become sustainable. Or so the theory goes. In practice, outcomes range from achieving measurable emission reductions, to the very opposite – a license to continue business as usual – or even worsen their environmental impact.

This lecture will explore the functioning of the two carbon market systems currently in operation: The voluntary markets and the mandatory (compliance) markets. Why do they exist as two separate and disconnected systems? What are the parallels and differences between them? How is each market used (and misused!), as businesses and individuals strive to limit global warming. The difference between emissions allowances and offsets will be explained and illustrated, while greenwashing and some of the traps that businesses can inadvertently fall into will be highlighted. The notions of carbon neutral and net zero will be compared to actual emissions reductions.

Additionally, a brief introduction to C4S – an initiative led by the Lord Mayor - will be provided, explaining how businesses can become part of an initiative to accelerate the energy transition and change the behaviour of major polluters by locking away and retiring their “permits to pollute”.


Dr Roger Cohen is Founder and CEO of C2Zero and RealCarbonIndex[1]. Starting as an academic, Roger spent most of his career in investment banking in Sydney and London. He leverages his diverse background to offer innovative perspectives at the intersection of technology, science, engineering, and finance.

C2Zero exemplifies this approach by bringing together technology, financial markets, and sustainability to facilitate access to regulated emissions markets, empowering businesses and individuals to contribute to the global transition to zero emissions. Simultaneously, RealCarbonIndex, developed by a team spanning academia and industry, stands as the world’s first family of indices tracking the development and current prices of physical carbon across global compliance markets and carbon taxes.

Roger is deeply committed to education, particularly in demystifying complex principles. He actively engages in delivering lectures and workshops, employing accessible methods including analogies and real-life examples. His talks, such as "Options without mathematics" and "How I taught my mother about short selling, securities lending, and other financial market practices," aim to bring understanding to diverse audiences with little or no assumed knowledge.

In this upcoming lecture, Roger will utilise these techniques to elucidate the workings of the two carbon market systems – voluntary and compliance – which operate in parallel, driving efforts to mitigate climate change.

[1] RealCarbonIndex is open source and free. Subscribe at https://www.realcarbonindex.org/ for weekly updates and to view current indices and related material.