By Charles Bedford, Founder, Carbon Growth Partners and Professor, Hong Kong University of Science and Technology

The debate over permanence in carbon markets has become trapped in a false choice. One side advocates thousand‑year geological storage. The other defends nature‑based solutions – forests, wetlands, mangroves – that deliver immediate climate benefits but face risks of fire, logging, and political instability. This framing obscures the real issue. Permanence is not a competition between nature and technology. It is a question of finance and governance.

The critical question is whether carbon markets – across voluntary, compliance, aviation, maritime, and emerging regional systems – will merely insure credits, or whether they will finance long‑term custodianship of the ecosystems that stabilise our climate. Today, most markets do the former. They must evolve to do the latter.

Insurance is about market security, not stewardship of nature

Across the voluntary carbon market, national regulatory systems, CORSIA, and emerging maritime mechanisms under discussion at the IMO, permanence is largely treated as a financial risk-management problem. Buffer pools set aside credits. Registries cancel units after reversals. Insurance products compensate buyers.

Current permanence tools protect market integrity. They protect claims and ledgers. But they do not protect forests. If a REDD+ project burns, credits are cancelled. Buyers claims are made “whole,” but the forest may not recover. Restoration lacks funding. Local institutions weaken. Revenues evaporate.  Forests are cut, emitting carbon and methane and damaging the earth’s carbon storage function.  Permanence, as currently structured, insures the commodity – not the carbon sink.

Forests are a systemic global asset

Primary tropical forests store roughly 250 billion tonnes of carbon – equivalent to decades of global fossil fuel emissions. They regulate rainfall, host biodiversity, and provide food and water security. Yet they are nearing ecological tipping points. Continued deforestation can turn them from carbon sink to carbon source. The climate system cannot afford for permanence to remain an accounting abstraction.

A global market at an inflection point

Carbon markets are no longer niche instruments. The voluntary carbon market is tightening integrity standards. National regulatory systems are incorporating project and jurisdictional carbon to provide flexibility in implementation and to promote adaptation and mitigation in situ. CORSIA is scaling aviation offset demand. Regional compliance markets are considering nature-based credits. And the UN’s Paris Agreement Crediting Mechanism (PACM) under Article 6.4 is emerging as a bridge between all systems.

Collectively, these markets will shape trillions in capital flows over the coming decades. The question is whether they will anchor those flows in long-term ecological stewardship.

Article 6.4: A structural opportunity

Article 6.4 offers something unique: a UN‑governed framework embedded in national climate commitments. Credits under PACM sit within sovereign NDC accounting. Host countries authorise units. Reversal risks are assessed at the methodology level. Permanence obligations are structured and transparent.

This architecture makes it possible to integrate international forest carbon finance into national land‑use governance. Jurisdictional and nested REDD+ is particularly suited for PACM as it operates at national or state scale, manages leakage, aligns with forest reference levels, and embeds carbon revenue within public institutions.

PACM is not merely another registry. It is a governance platform. But its ultimate impact will depend on design choices yet to come from the UN’s A6.4 Supervisory body, now more than a decade since Paris. We can lament the slowness of UN mechanisms, but we also must push forward now with the policy and markets that can scale to the size of our climate problem.

The missing link across all markets: Endowments

Whether under PACM, CORSIA, national compliance systems, or the voluntary market, permanence today is primarily backward-looking – compensating for failure after it occurs. True custodianship is forward-looking. It funds prevention, monitoring, adaptive management, and restoration.

Lessons abound from other fields: regulated biodiversity offset systems in the US, UK, and Colombia require legally protected endowment funds managed by independent trustees to ensure sites are maintained for the long term. Costa Rica’s Payment for Environmental Services program channels carbon revenues into a national fund that finances long-term forest protection. Enduring Earth’s Project Finance for Performance mechanisms have placed $1.7 billion into trust fund mechanisms to provide durable, results-based funding flows for biodiversity around the world.

Carbon markets should adopt similar institutional safeguards. Article 6.4 provides the most immediate opportunity. The Supervisory Body should require that methodologies require long-term stewardship funding such as sovereign trust funds, jurisdictional pools, or project-level endowments that are insulated from political cycles; complementing, not replacing, insurance and buffer mechanisms.

If PACM embeds endowment language, that benchmark would ripple outward to CORSIA eligibility criteria, national compliance markets and the voluntary market. Without such requirements, permanence will remain financial rather than ecological.

From offsets to institutions

No single approach solves climate change. We need:

• Nature-based solutions for immediate storage and resilience;
• Engineered removals for long-duration carbon management;
• Regional and sectoral markets to scale capital;
• Layered safeguards to manage risk.

But markets must be anchored in institutions capable of managing ecosystems over generations. Carbon sinks are not temporary assets. They are perpetual living infrastructure.

If global carbon markets – from voluntary to regulatory, from aviation to maritime, from regional systems to the UN framework – treat forests as supplies of short-term offsets, we will undermine the nature we depend upon. If they treat forests as public assets requiring permanent custodianship, they’ll catalyse durable climate stability.

We are rapidly building interconnected carbon markets across sectors and borders. In the process we must choose whether permanence means “compensated reversal” or “funded stewardship.”

Until permanence becomes an institutional commitment rather than a marketing claim, carbon markets will remain financially sophisticated – but ecologically fragile.

Charles Bedford is Founder and Chief Impact Officer at Carbon Growth Partners and an Adjunct and Visiting Professor at Hong Kong University of Science and Technology. He is also Senior Advisor to Terrasos.

Any opinions expressed in this commentary reflect the views of the authors and not of Carbon Pulse.

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