- International Carbon Registry (ICR) and Kita announce partnership for independent risk management of ICR’s buffer.
- ICR’s focus on quality assurance, process efficiency and transparent outcomes will be supported by the active risk management provided by Kita’s ‘Buffer as a Service’, enabling technical management and risk assessment aligned to financial industry norms.
- This announcement signifies the commencement of a governance update to incorporate Buffer as a Service into ICR’s protocols, which will conclude with a public consultation to ensure clarity for ICR’s key stakeholders.
REYKJAVIK, Iceland and LONDON, May 23, 2024 /PRNewswire/ — International Carbon Registry (ICR) and specialist carbon insurance company, Kita, are delighted to announce an agreement for Kita to provide ‘Buffer as a Service’ (BaaS) for ICR.
As per standard practice within the Voluntary Carbon Market (VCM), ICR manages a ‘buffer’, a central pool of carbon credits to which each project developer is required to individually contribute. Buffers are intended to ensure permanence and performance. However, as demonstrated by recent events in the wider VCM, risk per project can be variable and unexpected losses can occur, which have potential to damage the integrity of the carbon scheme.
Kita’s BaaS is independent risk management for ICR’s buffer, employing active risk controls, asset management best practices, and project-specific risk assessment based on insurance underwriting criteria. The aim is to help ICR proactively identify, manage and mitigate key risks, in conjunction with liquidity management and transparent reporting, to safeguard its ability to achieve positive climate outcomes.
ICR’s Mission Statement is focused on the guiding principles of:
- Quality Assurance
- Innovation
- Global Impact
- Transparency
- Collaboration
Buffer as a Service will help ICR achieve these aims by leading the way in the evolution of VCM buffers towards portfolio management run in-line with financial industry standards.
Projected outcomes include: (i) strengthening buffer quality assurance and reducing conflicts of interest through third party administration by a regulated entity; (ii) enabling collaborative solutions and smarter buffer contributions for high-quality project developers; (iii) increased trust in buffer function and strength via regular scenario analyses to assess and mitigate buffer depletion risks; and (iv) facilitating transparent compliance with evolving requirements within the VCM and wider regulatory bodies.
The function of Buffer as a Service will follow established norms in the wider financial markets to enable predictability of process to ICR’s stakeholders.
- “Innovation and transparency are built into ICR’s core operating principles, and as such we are delighted to be working with Kita to implement Buffer as a Service. We believe ICR’s stakeholders will benefit from cost efficiencies, transparent reporting and increased trust in the function and procedures of our buffer. We’ve always said that our goal is not for ICR to act as judge, jury and executioner, but instead to be supported by strong third party experts, such that we can act as a courtroom – attesting to the overall quality of projects that fit the ICR standard, thus playing a pivotal role in mitigating climate change, protecting ecosystems, and uplifting communities worldwide.“
– Guðmundur Sigbergsson – Founder and CEO of the ICR - “ICR stands out for their embrace of innovation, coupled with strong operational efficiency and focus on compliance and risk management. We share their belief that collaboration is a key driver of progress and we are proud to be supporting the ICR team via Buffer as a Service.
– Dr Paul Young, CTO and co-founder, Kita
This announcement signifies the commencement of a governance update of ICR’s operating procedures to incorporate the new structures of Kita’s Buffer as a Service. This governance update will conclude with a public consultation to ensure clarity for ICR’s key stakeholders.
Media Inquiries
Oli Torfason, COO
ICR
oli@carbonregistry.com
Jana Phillips
Kita
jana.phillips@kita.earth
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