Climate Finance
Carbon fund
A pooled vehicle that aggregates capital to purchase carbon credits or invest in projects at portfolio scale.
Carbon funds aggregate commitments from public or private investors and deploy them across a portfolio of projects or jurisdictions, spreading risk and reducing transaction costs.
Their governance determines what quality means in practice: eligibility criteria, due diligence depth and diversification rules decide whether the portfolio delivers integrity or merely volume.
Frequently asked questions
Do funds buy credits or projects?
Both models exist — some purchase future volumes, others take equity in developers.
What is the main investor risk?
Delivery shortfalls and reputational exposure if portfolio quality is weaker than represented.