Standard Chartered has entered into an exclusive agreement to sell millions of carbon credits tied to rainforest protection efforts in the Brazilian state of Acre. The move marks a significant step in the bank’s ambitions to expand its carbon markets business while helping to build much-needed credibility in a sector that is still finding its footing.
Over the next five years, Standard Chartered will handle the sale of forest-based carbon credits generated in Acre. According to the bank, this is one of the first instances where a global financial institution is collaborating directly with a sub-national government to promote forest conservation through the carbon credit market.
The project is expected to generate up to five million credits by 2026, potentially yielding $150 million in revenue. It also places the bank at the heart of a rapidly evolving conversation around the role of financial institutions in scaling climate finance.
This partnership arrives at a fragile moment for the voluntary carbon market. Earlier this year, prosecutors in Brazil’s Para state moved to annul a $180 million offset scheme, citing concerns over the legitimacy of forward contracts and the rights of local communities. Projects that claim to prevent deforestation have come under increasing scrutiny, with critics pointing out the difficulty in verifying exactly how much deforestation has been truly avoided.
“We are doing everything we can to ensure these are high quality from an environmental point of view and that a credit really does reduce a tonne of carbon,” said Chris Leeds, head of carbon markets development at the bank. “It is a very complicated process.”
The Acre initiative, however, takes a different approach. It operates under a jurisdictional framework, meaning carbon credits are issued by state-level programmes that aim to reduce emissions across entire regions rather than individual parcels of land. This model is designed to mitigate the risk of overstatement and enhance transparency and scalability.
Crucially, the deal includes local and indigenous communities in both planning and profit sharing. Seventy-two per cent of the net revenue generated by the state will go directly to these groups. A formal consultation process has already begun, with its main phase scheduled to launch in May 2025. The government has positioned community involvement as central to the project’s long-term legitimacy.
Unlike Para’s deal, Acre’s is not a forward sale, Leeds added. “There is no commitment on our part to sell the credits today. That is the difference.”
Acre is not the only Brazilian state pursuing this path. In July, the State of Piauí signed a similar agreement aimed at attracting climate-aligned investment in exchange for protecting large areas of forest.
As banks and governments explore new models to monetise natural capital, deals like this could set the tone for how climate finance, community rights, and environmental integrity are balanced in the years ahead.
