Standard Chartered, a UK-based international banking group, has announced a new agreement with the government of the Brazilian State of Acre. The bank will act as the seller of forest protection-based carbon credits on behalf of the state over the next five years.
Under the terms of the agreement, Standard Chartered will serve as the exclusive seller of these credits in the market. The bank anticipates the potential for 5 million credits to become available in 2026. These jurisdictional forest carbon credits encompass an entire jurisdiction, unlike project-based credits, and are managed by the government.
According to Standard Chartered, the carbon credits aim to protect forests in Acre, located in the Amazon rainforest, from deforestation by incentivising the preservation of existing forests. The government has committed to allocating 72% of the proceeds from the credits’ sale to indigenous and local communities. These funds will support sustainable activities such as low-emission livestock farming, reforestation of secondary forests, non-deforestation clearings, and community-based tourism. The remaining 28% will finance project management and governance, including forest management, monitoring, verification, and emergency response to extreme weather events.
Amarisio Freitas, Secretary of the Treasury of Acre and leader of the State’s Jurisdictional Carbon Project, stated: “This arrangement will bring economic and social benefits to the people of Acre, while protecting our natural resources and supporting the traditional communities and indigenous peoples of our state. The government has fought for a fair society by providing solutions for all its inhabitants, creating development mechanisms in the regions furthest from the capital without negatively impacting the ecosystem.”
Standard Chartered highlighted that this deal is one of the first instances of a major international bank collaborating with a sub-national government to support forest conservation. The bank believes this approach could establish a scalable model for jurisdiction-wide efforts to combat deforestation and reduce emissions.
The agreement is also expected to enhance integrity in the voluntary carbon market. The credits will be registered in the Architecture for the REDD+ Transactions (ART) registry, using its verified TREES methodology for quantifying, monitoring, reporting, and verifying greenhouse gas emission reductions.
Marisa Drew, Chief Sustainability Officer at Standard Chartered, commented: “Without deploying new market mechanisms, standing forests are unlikely to be protected because the short-term economic incentive for deforestation nearly always outweighs the perceived value of these long-term natural assets in situ. We’re leveraging our global network and carbon market expertise to address this challenge directly, offering a means to help preserve standing forests that act as vital carbon sinks, and in turn help the communities that depend on them continue to realise the economic and social returns they provide.”
