Bringing risk-adjusted returns to carbon
by Sebastien Cross, illuminem.com, August 22, 2023
„The Voluntary Carbon Market (VCM) is in a pre-Markowitz state akin to the 1930s or 1940s. It lacks a formalised concept of risk and remains stuck in a basic commodity paradigm, i.e. that a credit must equal an exact tonne of carbon dioxide equivalent. But as we’ve been arguing, carbon isn’t just another commodity market.“