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Auditors Fail in Role of Safeguarding Carbon Market, Study Finds

JOHANNESBURG, SOUTH AFRICA, OCT 21 – The summit seeks to build trust and align African carbon strategies with global standards while highlighting a projected market growth from $950 billion to $16 trillion in the next decade.

  • A study published Thursday in Science revealed widespread systemic failure by auditors to uphold integrity in carbon credit projects worldwide, raising concerns amid a market revival.
  • This failure stems from economic incentives and unconscious bias pressuring auditors, who risk their livelihoods if they disapprove many identified junk credits within a $2 billion peak market in 2022.
  • The authors studied 95 projects initially certified but later rejected or suspended by a leading registry and found 21 of just over 30 accredited auditors involved, showing the problem is widespread, not isolated.
  • Bill Winters, CEO of Standard Chartered, highlighted a large untapped corporate demand for credits but warned that increased demand could worsen audit problems, even as the UN’s 2023 rules pave the way for a new carbon market.
  • Despite concerns, numerous industry-led efforts aim to improve credit quality and demand as carbon markets reached about $950 billion in 2023 and are expected to grow significantly in the coming decade.
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DEBATE. The proposal to incorporate the Swedish Auditors' Inspectorate into the Swedish Financial Supervisory Authority would certainly benefit the treasury in the short term. In the longer term, however, there is a great risk that poorer supervision will mean increased costs to society, write two researchers.

·Stockholm, Sweden
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Africa Sustainability Matters broke the news in on Thursday, July 10, 2025.
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