The voluntary carbon sequestration market is currently developing and growing at a rapid pace. While public actors are considering their solutions, the private sector is investing massive capital to help build a cleaner future.
In Finland, many companies have actively started offsetting their own carbon dioxide emissions, a trend that has also been widely observed on a global scale. Leading multinational corporations are at the forefront of this movement, accelerating their efforts to meet their climate goals.
For example, last fall, Amazon announced that it was joining a carbon sequestration agreement in the Brazilian rainforests, alongside five other companies, aiming to protect these vital ecosystems. This is no small deal—the total purchase of carbon sinks amounted to $180 million, or over €170 million.
New carbon sink standards
Amazon, one of the world's largest companies, has been an active player in the carbon sequestration market. It has developed its own carbon sink standard, Abacus, in collaboration with the Verra carbon registry.
The company has stated that it wants to ensure the high quality and impact of its carbon sinks. Despite concerns about regulatory fragmentation, the Abacus standard has attracted major players, including Alphabet, the parent company of Google, Meta, the parent company of Facebook and Microsoft.
Amazon’s initiative, along with the participation of these global corporations, clearly demonstrates that private climate financing is available—as long as the actors themselves are credible.
In the United States, companies and states take center stage
At the same time, as U.S. President Donald Trump rolled back climate commitments, many companies, cities and states have been increasing their own climate actions.
The America Is All In coalition includes 362 local governments, 10 states, and nearly 3,000 businesses. The coalition claims to represent two-thirds of the U.S. population.
With this foundation, the coalition aims to ensure that the United States meets its targets under the Paris Agreement, despite the lack of federal climate leadership. The goal is to reduce emissions by 61–66% from 2005 levels by 2035.
A U.S. study analyzing the feasibility of this ambitious target found that, even without federal action, efforts by states, cities and especially businesses could still achieve a 54–62% reduction in emissions within the same timeframe.
In practice, this means that non-federal initiatives alone could enable the U.S. to reach its climate goals, highlighting the critical role of non-state actors in climate action.
The private sector plays a vital role
The comparison between the U.S. federal government and other actors highlights the significant impact that private and local public sector climate decisions can have on a larger scale.
Companies have the organizational capability to make faster climate-related decisions, as they already recognize the urgent need for action.
By taking climate action today rather than tomorrow, businesses can create a competitive advantage and financial benefits—especially while the prices of carbon sink credits remain low.
Private funding can also lead to more effective climate actions, provided that, for example, the offset carbon sinks are genuinely impactful. Private investors have an increasing need to ensure that their funds are used correctly and efficiently.
The EU needs to step up
While public actors must also take action to combat climate change, policymakers must recognize and respond to the potential of private sector initiatives.
Public authorities should establish the necessary framework for functional markets, ensuring that carbon sequestration occurs through market-driven mechanisms rather than taxpayer funding. This would direct financing toward the most economically viable solutions.
In shaping these frameworks, the EU, in particular, needs to sharpen its approach—including updating the existing CRCF framework—to enable the swift implementation of a unified carbon sink registry.
Instead of quibbling over wording, the Union must address its shortcomings in facilitating markets, allowing businesses to take meaningful climate action through well-functioning market mechanisms.
Comments